2025 (8) TMI 1312 - AT - Income Tax

Reopening under ss.147/148 quashed where assessing officer failed to record reasons; s.36(i)(iii) interest disallowance unsustainable appeal allowed

Sh. Navin Kumar Chaudhary Versus Income Tax Officer, Ward-60 (5), New Delhi

ITAT DELHI (AT) quashed the reopening of assessment under ss.147/148, finding the AO failed to record clear reasons showing the assessee did not disclose ... Reopening of assessment u/s 147 - disallowing interest expenditure u/s 36(i)(iii) - HELD THAT:- AO had not recorded any clear-cut reasons whilst initiating section 148/147 proceeding that there is assessee’s failure in disclosing particulars of income “fully” and “truly” in question u/s 147 first provision, and, therefore, the impugned reopening itself is held to be not sustainable in law. The same stands quashed in very terms. Assessee appeal allowed. Appeal against Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre order under section 147 read with section 143(3) for AY 2012-13. Assessment under section 143(3) was originally framed on 27.03.2015; a notice under section 148 was issued on 23.03.2018, leading to reassessment dated 27.12.2018 which disallowed interest expenditure of Rs. 11,84,820 under section 36(1)(iii). Proceedings were conducted ex parte. Tribunal found the fundamental defect in the reopening: the Assessing Officer 'had not recorded any clear-cut reasons' when initiating section 148/147 proceedings to show an assessee's failure to disclose particulars of income 'fully' and 'truly' as required by the first proviso to section 147. Consequently, the impugned reopening was held to be not sustainable in law and 'stands quashed.' All other merit grounds were rendered academic and the appeal was allowed.