Sanjay Sawhney vs Principal Commissioner Of Income Tax on 18 May, 2020
24. Similar is the view taken in the case of Principal Commission of
Income Tax, Vadodara - II v. Sun Pharmaceuticals Industries Ltd. 2017
86 taxmann.com 148 (Gujarat). The brief facts of the said case are that the
Respondent - assessee, a company registered under the Companies Act was
engaged in various businesses including manufacturing pharmaceuticals.
For relevant assessment years, the assessee had filed the returns of income
computing the same in terms of Section 115 JB. The AO issued notices for
reopening of the assessments and ultimately framed reassessment by making
various additions. In appeal, the assessee contested the reopening of the
assessments and also the addition made by AO. The Commissioner
(Appeals) allowed the appeals on the additions made by the AO, however on
the question of validity of reopening of the assessments, he held against the
assessee. Revenue preferred an appeal before the Tribunal, where the
assessee - Respondent without filing an appeal, relied upon Rule 27 of the
ITAT Rules and raised the legal issue of the validity of assessments before
the Tribunal. Despite objections from the Revenue, the Tribunal permitted
the assessee to raise such contentions and ultimately held that the notice for
reopening of assessment was bad in law. When the matter travelled to the
High Court, the question arose as to whether the Tribunal was right in law
by allowing Respondent - assessee to raise question of validity of notices
for reopening of assessments taking the recourse of Rule 27 of the ITAT
Rules without assessee having filed cross appeal or cross objection before
the Tribunal against order of Commissioner (Appeals).