The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT) dismissed the revenue’s miscellaneous application seeking recall of its earlier order, ruling that there was no need to recall the previous order, as a reasoned judgment had already been provided.
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Panel Commerce Pvt. Ltd., the assessee, is engaged in the business of trading in equity shares and finance. For the Assessment Year (AY) 2013-14, the assessee filed its return declaring a total income of ₹27,180.
Later, the Assessing Officer (AO) reopened the assessment based on information received from the investigation wing regarding a transaction of the assessee with Brahma Tradelinks Pvt. Ltd., which was suspected of being a shell company. The AO added ₹6.19 crores for share sales and ₹6.55 lakhs for cash deposits.
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Aggrieved by the AO’s order, the assessee appealed to the Commissioner of Income Tax (Appeal) (CIT(A)), who partly allowed the appeal, confirming ₹1.25 crore and deleting ₹4.94 crore. The revenue appealed to the ITAT, while the assessee filed a cross-objection supporting the decision made by the CIT(A).
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Sunil Surana, the counselrepresenting the assessee, pointed out that the tribunal, in the assessee’s own appeal for the same AY, had already quashed the reopening of the assessment. Therefore, the revenue’s appeal against the same appellate order had become unsustainable and should be dismissed.
The counsel also reiterated the reasons behind the tribunal’s earlier decision to quash the reassessment, stating it was based on borrowed satisfaction without an independent inquiry.
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Meanwhile, Raghuveer Madanappa, the counsel representing the revenue, pointed out that the revenue’s appeal was a separate matter and could not have been clubbed earlier. The counsel mentioned that the department had filed a Miscellaneous Application (MA) seeking a recall of the tribunal’s earlier order to allow a joint hearing of both appeals.
After hearing both sides, the Tribunal, comprising Sonjoy Sarma (Judicial Member) and Rajesh Kumar (Accountant Member), observed its earlier order, which had quashed the reassessment for being based on borrowed satisfaction without any independent inquiry by the AO.
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The tribunal noted that there was no point in recalling the previous order because a reasoned decision had already been given. The bench thus dismissed the revenue’s appeal, ruling it as unjustified since the foundation of the assessment had already been overturned.
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