Limitation for consequential assessments runs from prescribed authority receipt, while verified purchases cannot be disallowed merely for unanswered s...
Higher depreciation for qualifying commercial vehicles, exempt-income disallowance, research deduction verification, and club-expense treatment clarif...
Charitable registration renewal cannot become an assessment of receipts, profitability or annual exemption compliance, requiring renewal and donation ...
AMP expenditure for own business is not an international transaction without an associated-enterprise arrangement, eliminating transfer pricing adjust...
Customs valuation must use comparable contemporary imports, while confiscation fines and penalties require proportionate recalculation on reassessed v...
Depositor-protection proceedings prevail over corporate insolvency, while liquidators may recover chit receivables using copies of seized company reco...
The ITAT held that the Assessing Officer (AO) had incorrectly assumed facts while reopening the assessment u/s 147, leading to an erroneous belief of income escaping assessment. The assessee had already undergone scrutiny assessment u/s 143(3), disclosed share application receipts, and provided relevant details accepted by the AO. Despite adverse information from the CIT(A), the AO failed to conduct a preliminary inquiry and relied on incorrect assumptions. Mere adverse information triggers 'reason to suspect' but not the 'reason to believe' required for reopening assessment. The AO did not record proper reasons after examining material. Consequently, the notice issued u/s 148 was vitiated, held bad in law, and quashed by the ITAT, allowing the assessee's appeal.
The ITAT held that the Assessing Officer (AO) had incorrectly assumed facts while reopening the assessment u/s 147, leading to an erroneous belief of income escaping assessment. The assessee had already undergone scrutiny assessment u/s 143(3), disclosed share application receipts, and provided relevant details accepted by the AO. Despite adverse information from the CIT(A), the AO failed to conduct a preliminary inquiry and relied on incorrect assumptions. Mere adverse information triggers 'reason to suspect' but not the 'reason to believe' required for reopening assessment. The AO did not record proper reasons after examining material. Consequently, the notice issued u/s 148 was vitiated, held bad in law, and quashed by the ITAT, allowing the assessee's appeal.
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