Sh. Sangeet Singh Som vs Income Tax Officer

PER SATBEER SINGH GODARA, JM

These assessee’s twin appeals ITA Nos.3240 & 3241/Del/2018 for assessment years 2008-09 and 2014-15, arise against the Commissioner of Income Tax (Appeals) [in short, the “CIT(A)”], Ghaziabad’s orders dated 09.01.2018 and 28.02.2018 passed in case nos. 666/2013-14/GZB and 589892041120117, involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), respectively.

Heard both the parties. Case files perused.

Coming to the assessee’s instant former appeal ITA No.3240/Del/2018, it transpires during the course of hearing that there arises the first and foremost legal issue of validity of the impugned section 143(3) assessment itself making a “protective” addition of Rs.25 lakhs in his hands which stands upheld in the lower appellate discussion.

That being the case, the Revenue could hardly dispute the learned Assessing Officer’s clinching observations/findings at page 4 in the assessment order that he had first assessed the assessee on “protective” basis which was to be substantially added in the hands of the real “beneficiary”. Faced with this situation, we hereby quote Lalji Haridas Vs. ITO (1961) 43 ITR 387 (SC), M.P. Ramachandran Vs. DCIT (2011) 8 ITR (T) 655, Suresh K. Jajoo 39 SOT 514 (Mum) to conclude that neither such a “protective” assessment nor an addition made on very lines in absence of a substantive one, is not sustainable in law. We accordingly quash the impugned assessment framed in the assessee’s case herein for this precise reason. His instant former appeal ITA No. 3240/Del/2018 succeeds therefore.

Next comes the assessee’s latter appeal ITA No. 3241/Del/2018. There is hardly any dispute between the parties that both the learned lower authorities’ respective assessments and lower appellate findings have denied him foreign tax credit amounting to Rs.9,98,212/- under section 90/91 of the Act. The Revenue vehemently submits that neither the assessee had filed all the relevant details thereof in the assessment order nor in the lower appellate proceedings as per para 5.1 of the CIT(A)’s detailed discussion. We make it clear that there is no dispute about the assessee having derived the income in question from M/s. Tej Oil Trading Company Pvt. Ltd. amounting to $18,000 AUD. The fact also remains that he prima facie appears to have not filed all the requisite details thereof to the entire satisfaction of both the learned authorities.

We thus deem it appropriate to restore the assessee’s instant sole substantive grievance back to the Assessing Officer for his afresh factual reconciliation and verification as per law preferably within three effective opportunities of hearing. The assessee’s instant latter appeal ITA No. 3241/Del/2018 succeeds for statistical purposes.

To sum up, the assessee’s former appeal ITA No. 3240/Del/2018 is allowed and the latter appeal ITA No. 3241/Del/2018 is allowed for statistical purposes. A copy of this common order be placed in the respective case files.