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of <h1>Tribunal quashes assessments for AY 2007-08, 2008-09, and 2009-10, citing backdated reasons and mechanical approval.</h1> <h3>Smt. Geeta Bhasin, C/o. Sandeep Sapra, Advocate Versus ACIT, Circle : 28 (1), New Delhi.</h3> Smt. Geeta Bhasin, C/o. Sandeep Sapra, Advocate Versus ACIT, Circle : 28 (1), New Delhi. - TMI Issues Involved:1. Validity of reopening of assessment under Section 147 of the Income Tax Act, 1961.2. Addition under Section 68 of the Income Tax Act, 1961 regarding unexplained cash credits.Detailed Analysis:1. Validity of Reopening of Assessment under Section 147:The primary issue in these appeals is the validity of the reopening of assessments for AY 2007-08, 2008-09, and 2009-10 under Section 147 of the Income Tax Act, 1961. The reopening was based on the assessment proceedings for AY 2011-12, where the assessee was found to have adjusted a sum of Rs. 40,00,000 against an advance received for a plot of land from M/s PACL India Ltd. The Assessing Officer (AO) issued a notice under Section 148 on 27th March 2014, citing reasons that the assessee failed to prove the identity, creditworthiness, and genuineness of the transaction involving Rs. 2.34 crore received from M/s PACL India Ltd.The assessee objected to the reopening, arguing that the reasons recorded were backdated, as the assessment order for AY 2011-12 was passed on 31st March 2014, after the notice was issued. The Tribunal found merit in the assessee's argument, noting that the reasons recorded and the approval for reopening were based on an assessment order that did not exist at the time the reasons were recorded. The Tribunal concluded that the reasons recorded were backdated and the approval was mechanical, thus quashing the reopening of the assessments for all three years.2. Addition under Section 68 Regarding Unexplained Cash Credits:On the merits, the AO had added Rs. 10,00,000 under Section 68 for AY 2007-08, stating that the assessee failed to prove the genuineness of the transaction with M/s PACL India Ltd., despite providing the confirmation and bank statement. The CIT (Appeals) upheld the AO's decision, citing several reasons, including the lack of documentary evidence to support the MOU and the terms of the transaction.The Tribunal, however, did not delve into the merits of the addition under Section 68, as it quashed the reopening of the assessment itself. The Tribunal noted that the assessee had provided sufficient evidence, including confirmation from M/s PACL India Ltd., their PAN, and details of their income, to establish the identity and creditworthiness of the creditor. The Tribunal emphasized that the reopening was invalid due to the backdated reasons and mechanical approval, thus rendering the addition under Section 68 moot.Conclusion:The Tribunal quashed the reopening of assessments for AY 2007-08, 2008-09, and 2009-10 under Section 147, finding that the reasons recorded for reopening were backdated and the approval was mechanical. Consequently, the addition under Section 68 for AY 2007-08 was also quashed. The appeals of the assessee were allowed on the ground of invalid reopening of assessments.
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