TaxTMI 
TaxTMI 
2018 (6) TMI 274
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....see are as under: "1. The Id. Commissioner of Income Tax (Appeals) erred in confirming the Order passed uls.143(3) r.w.s. 147 without appreciating that the necessary satisfaction of Joint Commissioner of Income Tax as required u/s.151 of the Income Tax Act was not obtained prior to issuance of Notice u/s.148 and therefore the assessment itself was bad in law. 2. The Id. Commissioner of Income Tax (Appeals) erred in confirming the Reopening of assessment uls.148 of the Income Tax Act without appreciating that the Assessee Firm had disclosed thoroughly and fully all the material facts during the original assessment proceedings uls.143(3) and therefore the reason to believe formed by Id. Assess ing Of f icer was bad in law an....
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....l income of Rs. 3,03,99,770/-. Thereafter, the said assessment was reopened vide notice issued under section 148 dated 27.03.2014 which was complied with by the assessee by submitting vide letter dated 10.04.2014 that return of income filed originally may kindly be treated as return in response to notice u/s 148 of the Act and statutory notices under section 143(2) and 142(1) were duly issued and served upon the assessee. Thus the reassessment proceedings were started within four years from the end of the relevant assessment year. The reasons recorded for issuing the notice under section 148 of the Act are as under: "The assessee is partnership firm three partners and capital account of one of the partners namely Shri K.D. Mehta ha....
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....of the partner and (ii) withdrawal of interest of Rs. 23,35,760/- already allowed to partner. 6. In the appellate proceedings, the assessee challenged the reopening of the assessment on frivolous and flimsy reasons which are nothing but change of opinion. The Ld. CIT(A) dismissed the appeal of the assessee after considering the submissions as have been incorporated in the appellate order in para 5.2 by observing that the reassessment proceedings were validly initiated. The Ld. CIT(A) also noted that the assessee has not objected the initiation of reassessment proceedings under section 147 of the Act whereas the AO has given sound reasons in para 2 of the assessment order for such re-opening. According to the Ld. CIT(A) the non compliance....
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....py of ledger accounts were furnished in the original assessment proceedings before the AO. The Ld. A.R. drew our attention to letter dated 30.08.2011 addressed to the DCIT (the AO) wherein in para No.4 the assessee has furnished the details of credits during the year in the partner's account and the ledger accounts. The Ld. A.R. also took us to the copy of capital account of Shri K.D. Mehta in which the credit balance appearing as on 01.04.2008 was Rs. 1,94,64,671/- and thereafter during the year various credit and debit entries were made and ultimately there was excess of debit over credit to the tune of Rs. 18,42,092/-. The Ld. A.R. submitted that all these details and information were provided before the AO at the time of framing of orig....
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....oth the parties and perused the material on record. The undisputed facts are that the assessment in this case was reopened within a period of four years from the end of the relevant assessment year in order to bring to tax the interest on capital account to the tune of Rs. 23,35,760/- comprising both interest to be charged on debit capital balance and withdrawal of interest wrongly allowed which according to the Revenue was wrongly allowed as the assessee has overdrawn the capital account to the tune of Rs. 18,42,092/- and therefore, the same needs to be withdrawn. The first appellate authority upheld the reopening on the ground that the assessee has not objected and challenged the reopening before the AO and the belief formed by the AO on ....
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....MAC India vs. DCIT (supra). In the case of Madhukar Khosla vs. ACIT (supra) the Hon'ble Delhi High Court has considered the decision of the apex court in the case of CIT vs. Kelvinator of India Ltd. and various other decisions and held that there was nothing to show what triggered issuance of notice of reassessment as there was no information or new facts which could led the AO to believe that full disclosure had not been made and said notice can not be sustained. In the case of Motilal R. Todi vs. ACIT (supra) wherein it has been held by the co-ordinate bench of the Tribunal that there has to be fresh tangible material in the possession of AO at the time of recording of impugned reasons before he could proceed to record the reason for the ....