fe- ^ff'-i•-'--^*,, /y^ //""^ '%. •'; B '1»J J '•s-T k: ^/^ -^^ • HIGH COURT OF CHHATTISGARH AT BILASPUR Tax Case (Income Tax Appeal) No.47 of 2008 APPELLANT: Commissioner of Income Tax, Bilaspur (CG) Versus RESPONDENT: Dinesh Kumar Agrawal, Prop. Dinesh Marketing, P.H. Road, Korba (CG) JUDGMENT FOR CONSIDERATION Sd/- JUDGE -10-2010 HON'BLE SHRI R.N. CHANDRAKAR. J ^ OJOi}L^-' 0 Sd/- R.N. Chandrakar Judge -til POSTFORJUDGMENTON '?' OCTOBER,^Q-UL_ Sd/- Dhirendra Mishra Judge HIGH COURT OF CHHATTISGARH AT BILASPUR Tax Case (Income Tax ApDeal) No.47 of 2008 APPELLANT: Commissioner of Income Tax, Bilaspur (CG) Versus RESPONDENT: Dinesh Kumar Agrawal, Prop. Dinesh Marketing, P.H. Road, Korba (CG) Present: Shri Rajeev Shrivastava, counsel for the appellant. Shri Ranbir Singh Marhas, counsel for the respondent. Division Bench: Hon'ble Shri Dhirendra Mishra & Hon'ble Shri R.N. Chandrakar. JJ. JUDG.MENT (Delivered on _^ October, 2010) The following judgment of the Court was delivered by Dhirendra Mishra, J. 1. This appeal has been admitted on the following substantial question of law:- • "Whether the concept of "change of opinion" is applicable to the provisions of Section 263 especially as the order of the Commissioner of Income Tax was not based on any change of opinion but on the errors highlighted in the order?" 2. Briefly stated facts of the case are that the assessee filed his return of his income for the assessment year 2004-05 by disclosing total income of Rs.89,830/-. The case was selected for scrutiny after approval from the CCIT and the assessment was completed under Section 143 (3) of the Income Tax Act, 1961 (for short 'the Act') on total income of Rs.89,830/-. 3. On examination of the record, CIT found that the following aspects of the case have not been properly scrutinized by the A.O.:- (i) The assessee's claim about receipt of cash gifts from three different persons amounting to Rs.4,00,000/- had been allowed by the A.O. without verifying the creditworthiness of the alleged donors as well as the occasions warranting such gifts. (ii) Petty loans taken from relatives as well as loans advanced to others were never verified. (iii) The expenses debited in the profit & loss a/c had been accepted without verifying or calling the details. (iv) The assessee has spent more in .LIC premium as compared to house hold expenses. This has not been verified. (v) The bank statement were not verified or investigated. (vi) During the relevant year the assessee has introduced fresh capital to the tune of Rs.5,69,000/. This has been accepted without Verification of the sources." 4. The assessee was served with a notice under Section 263 (1) of the Act and after affording opportunity of hearing to the assessee, infirmities were found in the assessment order as detailed in paragraphs 4, 4.1, 4.2, 4.3, 4.4 & 4.5 of the order. The CIT held that the order passed by the A.O. is erroneous and prejudicial to the interest of the revenue and accordingly, cancelled the same under Section 263 of the Act with direction to the A.O. to frame it afresh. It was furi:her directed that while passing the order de novo, the A.O. will examine the issues mentioned in the order keeping in view the actions contemplated under Section 271 (1)(c) ofthe Act. 5. The assessee went up in appeal against the order of the CIT before the Tribunal, however, the Tribunal cancelled the order of the CIT with -:^^ 1 ^jSS^ . !SQs£ass^ ^^ an observation that "a close perusal of the relevant documents and evidences, which have been placed before us in form of paper books, makes it clear that the assessee has placed all the documents and evidences in respect of these items before the A.O. and the A.O. after perusing the same has compteted the assessment. Since the assessment under section 143(3) was completed by the A.O. only after perusing the relevant details and evidences placed by the assessee, the action of Id. CIT in invoking the provision under section 263 is nothing but is based on mere change of opinion, which is not permissible under the law as held by the different Courts and Tribunals." 6. Learned counsel for the appellant submitted that CIT after careful examination of the record has detailed various aspects in its order which clearly points out that assessment was completed in haste and without proper enquiry. The order under Section 263 was passed after due notice and after affording opportunity of hearing to the assessee, however, the ITAT without dealing with various aspects detailed in the order of the CIT has cancelled the order with an observation that the order under Section 263 of the Act is nothing but is based on mere change of opinion which is not permissible under the law. 7. Relying upon decisions of this Court in the matters of Commissioner of Income Tax, Bilaspur Vs. Harish Kumar Shah {Tax Case No.46 of 2008, decided on 8 January, 2010} and Commissioner of Income Tax, Bilaspur (CG) Vs. Dr. Smt. Anju Goyal {Tax Case No.36/2008, decided on 1 September, 2009}, it was argued that the present case is squarely covered by the law laid down by this Court in the aforesaid judgments. 8. On the other hand, learned counsel for the respondent/assessee submitted that the instant appeal has been preferred by the CIT whereas the order under Section 263 (1) has been passed by the CIT in exercise of its quas/ judicial function. The appeal by the revenue under Section 260-A can be preferred by the Chief Commissioner or the Commissioner of Income Tax. Filing of appeal by the CIT for vindication of its own order passed under Section 263 (1) while discharging quasi judicial function is impermissible and the instant appeal ought to have been filed by the Chief Commissioner. On this ground alone, the appeal deserves to be dismissed. 9. It was further argued that the Tribunal has passed the impugned order after going through the relevant documents and evidences which have been placed before it in form of paper book and the Assessing Officer has also completed the assessment after perusing the same. 10. In these circumstances, the order of the Commissioner under Section 263 (1) cannot be affirmed by setting aside the order of the Tribunal only on the ground that the Tribunal has not dealt with errors and infirmities pointed out by the CIT by a reasoned order. At the most, the matter may be remanded to the Tribunal for passing a reasoned order afresh after affording opportunity of hearing to the parties. 11. Heard learned counsel forthe parties. 12. So far as objection of the respondent against the appeal preferred by the CIT against the order of the Tribunal is concerned, though CIT has BB passed the order under Section 263 (1) of the Act in discharge of its quasi judicial function, but the instant appeal has been preferred by the CIT in his administrative capacity in the interest of the revenue. Therefore, we are of the considered opinion that the instant appeal cannot be dismissed only on the ground that it has been flled by the same authority whose order has been reversed by the impugned order. is.After going through the orders of the A.O. as also of the CIT passed under Section 263 (1) and the impugned order, we find that the Tribunal, without adverting to the reasons assigned by the CIT for canceling the order of assessment passed by the A.O., has cancelled the order of the CIT onthe ground that the same is based on mere change of opinion. The issue involved in this appeal has already been considered and decided by this Court in the matters of Dr. Smt. Anju Goyal and Harish Kumar Shah (Supra). l4.For the aforesaid reasons, we are of the opinion that the impugned order of the ITAT cannot be sustained. Accordingly, the same is hereby set aside. The matter is remanded to the Tribunal to decide the appeal preferred by the assessee against the order of CIT afresh by a reasoned order after affording opportunity of hearing to the parties. Sd/- Dhirendra Mishra Judge Sd/- R.N. Chandrakar Judge Barve