Orissa HC dismissed petition for not having any substantial question of law

Biswajit Behera Vs ITO (Orissa High Court)

Orissa High Court held that challenge against order restoring the reassessment proceedings is not maintainable in absence of any substantial question of law. Accordingly, petition dismissed.

Facts- The present appeal is preferred against order passed by ITAT pertaining to assessment year 2012-13. Appeal before the Tribunal was against appellate order dated 21^st September, 2023. On last day of the prescribed period, notice under section 148 in Income Tax Act, 1961 was issued. Petitioner contested that without considering and dealing with the objection, assessment order was made. The first appellate authority confirmed the assessment order.

Conclusion- In event, consideration of the objection renders satisfaction to the AO that the reopening does not result in enhancement, the proceeding will be appropriately closed.

Held that no substantial question of law arises for admission of the appeal.

FULL TEXT OF THE JUDGMENT/ORDER OF ORISSA HIGH COURT

1. Mr. Parida, learned advocate appears on behalf of appellant- assessee. He submits, his client seeks to prefer appeal against order dated 4^th January, 2024 made by the Income Tax Appellate Tribunal, Cuttack Bench in ITA no.329/CTK/2023, pertaining to assessment year 2012-13.

2. Appeal before the Tribunal was against appellate order dated 21^st September, 2023. On last day of the prescribed period, notice under section 148 in Income Tax Act, 1961 was issued to his client. He obtained reasons for belief and thereupon filed objection. Without considering and dealing with the objection, assessment order was made. The first appellate authority confirmed the assessment order, against which his client moved the Tribunal.

3. Mr. Parida submits, the Tribunal erred in restoring the re­assessment proceeding since his client’s objection to the reopening had not been dealt with by the Assessing Officer (AO). He relies on decision of the Supreme Court in GKN Driveshafts (India) Ltd. v. ITO, reported in (2003) 259 ITR 19 (SC). A substantial question of law arises on whether the Tribunal was correct in so restoring. He seeks admission of the appeal on a substantial question of law suggested in the memo or on any question as may be formulated by us.

4. Mr. Kedia, learned advocate, Junior Standing Counsel appears on behalf revenue and submits, the Tribunal committed no error in restoring the re-assessment proceeding. Appellant can participate in the restored proceeding as the Tribunal had also given liberty for him to take additional objection. In the circumstances, no question of law arises, let alone a substantial question.

5. The appeal on  query from Court, Mr. Parida submits, law prevailing and applicable to relevant assessment year did not provide for filing objection. He, however, reiterates that law stood declared by the Supreme Court on GKN Driveshafts (India) Ltd. (supra) and therefore question of law arises for admission of the appeal.

6. Paragraph-6 of impugned order is reproduced below:

“6. I have considered the rival submission. A perusal of the facts in the present case clearly shows that the assessee has filed objection to the reopening of assessment on 25.07.2019. The assessment has been completed only on 13.12.2019. The Assessing Officer has not disposed of the objection filed by the assessee on 25.07.2019. Hence, an irregularity has taken place at the point where the Assessing Officer has proceeded with the assessment without disposing the objection raised by the assessee. This being so, in view of the principles laid down by the Hon’ble Supreme Court in the case of GKN Driveshafts (India) Ltd. (supra), the issues in this appeal are restored to the file of the Assessing Officer for re-adjudication after disposing the objection raised by the assessee against reopening. Liberty is granted to the assessee to raise any further objection he may have in the course of set aside assessment proceedings.”

(emphasis supplied)

We see that the Tribunal in following the declaration of law made by the Supreme Court, directed the AO to re-adjudicate upon first dealing with the objection. In event, consideration of the objection renders satisfaction to the AO that the reopening does not result in enhancement, the proceeding will be appropriately closed.

7. No substantial question of law arises for admission of the appeal. It is disposed of as above.