High Court Of Punjab & Haryana
Ramesh Chander Singla vs. CIT (Appeals) & Anr.
Section 147, 148,
Asst. Year 1994-95, 1995-96, 1996-97
Adarsh Kumar Goel & Ajay Kumar Mittal, JJ.
IT Appeal No. 284 of 2005
14th October, 2010
Counsel Appeared :
Akshay Bhan, for the Appellant : Sanjiv Kaushik, for the Respondents
JUDGMENT
ADARSH KUMAR GOEL, J. :
This order will dispose of IT Appeal Nos. 284, 285, 286, 287 and 288 of 2005 as common question relating to the validity of reassessment is involved.
2. In IT Appeal No. 284 of 2005, the assessee has raised following questions of law :
“(i) Whether in the facts and circumstances of the present case the action of the authorities below in initiating proceedings under s. 147/148 of the Act in the absence of any new ground or reasonable cause, is legally sustainable in the eyes of law ?
(ii) Whether in the facts and circumstances of the present case the action of the authorities below in holding proceedings under s. 143(1)(a) of the Act not to be assessment proceeding is legally sustainable in the eyes of law ?
(iii) Whether in the facts and circumstances of the present case the action of the authorities below in initiating reassessment proceedings under s. 147/148 of the Act on mere change of opinion, is legally sustainable in the eyes of law ?”
3. The assessee is a development officer of the LIC and claimed deduction on incentive bonus and additional conveyance allowance received by him. Return of the assessee was processed thereby benefit of deduction was taken by the assessee. In the light of the judgment of this Court CIT vs. B.M. Parmar (1998) 150 CTR (P&H) 548 : (1999) 235 ITR 679 (P&H) holding that the assessee was to be governed by the head of salary, he could not get deduction by treating income under the head of ‘Business’ income, proceedings for reassessment were initiated. The reassessment was upheld by the CIT(A) and the Tribunal. The Tribunal observed : “2.10 Now we proceed to decide the next issue as to whether in the existing facts and circumstances of the cases of the assessee, the reopening of the assessments by the AO under s. 147/148 of the Act and passing an order under s. 143(3) of the Act is valid or not. In the instant cases, the assessment for the relevant assessment year was reopened by the AO under s. 143(1) (a) admitting the claim of the assessee in respect of incentive bonus and additional conveyance allowance. Later on, after reopening the assessment, the AO disallowed the claim of rebate from incentive bonus and additional conveyance allowance in excess of the certified amount by the DDO of LIC of India, by placing reliance on the decisions of the jurisdictional High Court of Punjab & Haryana delivered in the cases of CIT vs. B.M. Parmar (1998) 150 CTR (P&H) 548 : (1999) 235 ITR 679 (P&H); in the case of CIT vs. H.S. Sandhu (1999) 156 CTR (P&H) 533 : (1999) 237 ITR 167 (P&H) and in the case of CIT vs. Chaman Lal Chandok (2000) 241 ITR (P&H) 442. 2.11 Upon reading of s. 147 of the Act, we find that in view of the explanation 2(c)(i) wherein it has been clearly mentioned that where the income chargeable to tax has been under-assessed, it will be deemed to be a case where income chargeable to tax has escaped assessment. In the instant cases, this fact that income chargeable to tax has escaped assessment, came to the knowledge of the AO when the jurisdictional High Court of Punjab & Haryana in the cases (supra) held that the incentive bonus is assessable under the head ‘salary’ and not under the head ‘profits and gains of business or profession’ and therefore, deduction under s. 16(i) of the Act is admissible under the head ‘salary’ and no separate deduction on account of expenditure is permissible and that deduction claimed by the development officer of LIC of India in respect of the additional conveyance allowance is only allowable to the assessee to the extent of the amount certified, to have been incurred by the development officer in discharge of his duties, by the DDO of LIC of India. These decisions of the jurisdictional High Court of Punjab & Haryana were binding on the AO and were the law for the AO working under the jurisdiction of Punjab & Haryana. It was this knowledge and information which lead to the formation of the belief of the AO that the income of the assessee has been under-assessed and so as per Expln. 2(c)(i) of s. 147 of the Act, the income of the assessee has escaped assessment and hence we are of the opinion that as per provisions of s. 147/148 of the Act, the assessment reopened by the AO and the additions made by framing the assessment under s. 147 r/w s. 143 (3) was valid and legal as it was based on the decisions (supra) of the jurisdictional High Court of Punjab & Haryana on the basis of which the claim already allowed by the AO under s. 143(1)(a) of the Act was required to be disallowed by the AO by reopening the assessment under s. 147 and passing an order under s. 147 r/w s. 143(3) of the Act.” We have heard learned counsel for the parties.
Learned counsel for the assessee is unable to dispute that in view of the judgment of this Court in Punjab Tractors Ltd. vs. Jt. CIT (2002) 173 CTR (P&H) 84 (P&H) : (2002) 254 ITR 242 (P&H) issuance of notice under s. 147 of the IT Act, 1961 could not be challenged on the ground that the original assessment was not made under s. 143(3) of the Act. Questions raised have thus to be decided against the assessee. Further question raised in respect of asst. yrs. 1994-95 to 1996-97 is that proceedings for reassessment were barred by limitation under s. 149 of the Act. We find that neither before the CIT (A) nor before the Tribunal this plea was urged. The question raised does not arise from the order of the Tribunal. The same cannot be held to be a substantial question of law.
7. Accordingly, these appeals are dismissed.
[Citation : 330 ITR 288]
