TaxTMI 
TaxTMI 
2017 (11) TMI 1352
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.... 144/147 of the I.T. Act, dated 16th December, 2010 and made the addition of Rs. 65 lakhs on account of unexplained cash credit under section 68 of the I.T. Act. 2.1. The assessee challenged the re-assessment order dated 16th December, 2010 before Ld. CIT(A). The assessee challenged the reopening of the assessment as well as addition of Rs. 65 lakhs under section 68 of the I.T. Act. The Ld. CIT(A) after considering the explanation of assessee, noted that reasons were recorded on the basis of information received from ADIT (Inv.) and on the basis of the statement of Shri Harish Pawar which is fresh information recorded by the Investigation wing. The reopening of the assessment was therefore, confirmed and addition on merit was also confirmed. 3. We have heard the learned Representatives of both the parties and perused the material on record. 4. It is well settled law that validity of the reopening of the assessment shall have to be determined with reference to the reasons recorded under section 147/148 of the I.T. Act. It is an admitted fact that earlier the re-assessment proceedings were completed vide order dated 26th October, 2007. The copy of the reasons recorded in the first....
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.... to disclose its income fully and truly. Issue notice u/s.148 of the I.T. Act. Dated 25.03.2010 Sd/-xxx (Neha Chaudhary) Dy. Commissioner of Income Tax Circle-11(1), New Delhi." 4.1. In the above reasons, the A.O. has mentioned the same fact/reasons which were recorded earlier that information have been received from ADIT (Inv,) Wing, New Delhi and on verification of the assessment record, it was noticed that assessee has received accommodation entry from Shri Harish Pawar. It is also noted that earlier assessment under section 147/143(3) was completed on 26th October, 2007 and same addition has not been added back. The A.O. therefore, had a reason to believe that income chargeable to tax has escaped assessment because of the failure on the part of assessee to disclose its income fully and truly. The reasons are recorded on 25th March, 2010. Learned Counsel for the Assessee submitted that this information was already available on record and assessee had also disclosed the receipt of the above amount in the regular books of account, on which, earlier return was processed as well as proceeding under section 147 were also conducted vide order dated 26th October, 20....
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....ed under section 147 of the I.T. Act. As per the reasons itself, the report of ADIT (Inv.) was already with the A.O. about the receipt of accommodation entry by assessee when original re-assessment proceedings were initiated. The A.O. in para-3 of the reasons also noted that in the assessment completed under section 147/143(3) dated 26th October, 2007 the same has not been added back which would mean that the A.O. did not make addition of Rs. 65 lakhs as receipt from Shri Harish Pawar in the original re-assessment order dated 26th October, 2007. Therefore, there is no question of any failure on the part of assessee to disclose fully and truly all material facts necessary for the assessment because of such information were already available on record of the Department and assessee has also disclosed the receipt of Rs. 65 lakhs from Shri Harish Pawar in the original return of income. The A.O. in the original reasons recorded under section 147/148 had also similarly recorded that assessee-company has failed to disclose fully and truly all material facts and source of these funds through bank account of the assessee-company (PB-3). However, such finding of the A.O. have been negated by....
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....ongly claimed certain deductions which he was not entitled to. The reassessment proceedings initiated in the year 2004 were not valid." 4.3. The Hon'ble Delhi High Court in the case of Techman Buildwell P. Ltd., vs. ACIT (2015) 370 ITR 771 (Del.) held as under : "Held, allowing the petition, that the "reasons to believe" nowhere highlighted what, if at all, was the material which the Assessing Officer came upon or became aware of subsequent to the original assessment. In other words, what triggered the Assessing Officer's curiosity to impel him to reexamine the files and documents pertaining to a completed assessment was unknown. Nor did the materials placed in the assessment show that the assesses had unjustifiably suppressed valid or relevant information which was otherwise available. The advertence to the disallowance of a provision for an unascertained liability points to the Assessing Officer indulging in what amounted to nothing but a masked review. What appeared to have excited the Assessing Officer's mind was that the original assessment order was not framed properly as it overlooked certain materials which led to loss of revenue. The Assessing Officer in the fi....