AO's failure to address assessee's submissions leads to quashing of Section 148A(d) reopening order

The Bombay HC quashed a reopening order passed under Section 148A(d) where the AO failed to address the assessee's submissions. The petitioner argued that the first issue regarding FSI value was a change of opinion as it was already assessed, and the second issue was previously decided by ITAT in assessee's favor for AY 2011-2012. Since the AO did not deal with these submissions, the HC held the order unsustainable and quashed both the reopening order and consequential notice under Section 148. The matter was remanded for fresh consideration. Decision favored the assessee.

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Issues involved:
The issues involved in the judgment are the reassessment of the Petitioner for the Assessment Year 2016-2017 under Section 148A(b) of the Income Tax Act, 1961 based on audit objections raised regarding a supplemental agreement dated 23rd August 2014.

Details of the judgment:

1. The Petitioner, a Middle Income Group Co-operative Housing Society, entered into a development agreement with a Developer in 2010, which was later supplemented in 2014 to avail additional benefits under the Development Rules.

2. The Revenue reopened the assessment for the AY 2011-2012, assessing a higher income than the returned income. The ITAT later ruled in favor of the Petitioner, stating that the members had already paid tax on compensations, hence avoiding double taxation.

3. For the AY 2016-2017, the Petitioner received a notice under Section 148A(b) based on audit objections related to the supplemental agreement.

4. The audit objections raised concerned the additional benefits received by the Society from the Developer, leading to an alleged escapement of income.

5. The Petitioner responded to the notice, citing that the issues raised were already addressed in previous assessments and rulings by the ITAT.

6. The AO's order under Section 148A(d) did not consider the Petitioner's submissions, leading the Court to quash the order and remand the matter for reconsideration.

7. The Court ordered the AO to pass a reasoned order addressing all submissions of the Petitioner and providing a personal hearing before making any decision.

8. The impugned order and consequential notice were quashed, and the matter was remanded for de-novo consideration by the AO.

9. The Petition was disposed of with no order as to costs, keeping all rights and contentions of parties open.

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