TaxTMI 
TaxTMI 
2016 (5) TMI 115
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....ct of Assessment Years (AYs) 2007-2008 to 2012-2013. 2. While directing issuance of notice in the writ petitions on 7th January, 2015, this court directed that no further steps shall be taken pursuant to the aforementioned notices. Further, by order dated 13th August 2015, the Court directed that W.P.(C) No.9386/2014, which pertains to the AY 2007-2008, shall be treated as the lead matter. A counter affidavit has been filed by the Respondent in the said writ petition. 3. For each of the above AYs, the returns filed by the two Assessees were processed under Section 143(1) of the Act. Only in respect of AY 2009-2010, the return filed by SAPL on 29th September, 2009 was picked up for scrutiny and an assessment order passed under Section 143(3) of the Act. 4. The broad grounds of challenge to the reopening of the assessments is that in respect of AY 2007-2008 and 2008-2009 pertaining to SAPL, the notices were beyond the period of four years after the end of the AY in which the return was filed; in respect of SPIPL barring the notices for AYs 2010-2011 and 2011-2012, none of the other notices were served on SPIPL; for AY 2007-2008, the notice issued to SPIPL was beyond four years. Ho....
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....main unexplained credits u/s 68 of I.T. Act. During A.Y. 201I-11 share premium & share applicable money received in A.Y. 2008-09 by SPIPL is Rs. 50 lac & in A. Y. 2009-10 75 lac. SAPL Rs. 50 lac in A.Y. 2009-10 for verification of transaction and existence of companies or merely providing book entries and commission issued to DDIT Kolkata & report awaited. The loans received by M/s. SAPL and M/s. SPIPL in AY 11-12 before the takeover of company M/s. MDPL remains unexplained as under. - M/s Sabharwal Properties Industries Pvt. Ltd. (SPIPL) Rs. 5244306/- M/s Sabharwal Apartment Pvt. Ltd. (SAPL) Rs. 5345082/- The source and genuineness of share application money and share premium received for the A.Y. 2010-11 has to be examined. M/s Sabharwal Properties Industries Pvt. Ltd. (SPIPL) Rs. 12500000/- M/s Sabharwal Apartments Industries Pvt. Ltd. (SAPL) Rs. 5000000/-" 7. In respect of the above reasons, objections were filed by both the Assessees for each of the AYs on 20th October, 2014 and the objections were rejected by the orders dated 24th October 2014 passed by the Income Tax Officer Ward-7(1), New Delhi. These orders have also been challenged in the present writ petit....
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....est to check abuse of power by the Assessing Officer. Hence, after 1st April, 1989, Assessing Officer has power to re-open, provided there is 'tangible material' to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief." 11. Turning to the case on hand, the Court has been able to decipher, with the assistance of the learned counsel for the Revenue, the reasons as stated for reopening the assessments to be as under: i. A survey operation under Section 133A was conducted by the Investigation Wing, New Delhi on 12th December, 2013 in the premises of SAPL and SPIPL. ii. Both SAPL and SPIPL showed unsecured loans of Rs. 9.65 crore having been borrowed from Mahima Distributors Private Limited ('MDPL'), Kolkata for AY 2011-2012. iii. The shares of MDPL worth more than Rs. 9 crore were acquired by four companies for Rs. 37lakhs, whereas other companies which acquired shares of MDPL paid a huge premium over and above the par value of Rs. 10/- per share in AY 2007-2008. iv. The report of the Investigation Wing, Kolkata verifying the receipt of share premium by MDPL was awaited. v. The investigation....
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.... orders dated 24th October 2014, do not find any mention in the original reasons recorded for reopening the assessment: i. The Assessees purchased a company, MDPL, for Rs. 37 lakh though the investment of the company was Rs. 9 crore. ii. MDPL was found to be bogus and there was no actual transaction involving it. iii. There was a statement of the Director of MDPL to the above effect recorded by the Investigation Wing, Kolkata. iv. The escapement of income was more than Rs. 1 lakh. v. The 'various persons' who had transactions with MDPL were also bogus. 15. Further, in the counter affidavit filed by the Respondent, the above reasons adduced for the first time in the order rejecting the objections have been sought to be reiterated. 16. It is well settled that the reasons recorded for reopening the assessment have to speak for themselves. They have to spell out that (i) there was a failure of the Assessee to disclose fully and truly all the material facts necessary for the assessment and (ii) the reasons must provide a live link to the formation of the belief that income had escaped assessment. These reasons cannot be supplied subsequent to the recording of such re....