TaxTMI 
TaxTMI 
2022 (3) TMI 294
X X X X Extracts X X X X
X X X X Extracts X X X X
....ase of Ms. Davinder Knur Marwah, for Asstt. Yr. 2011-12 u/s. 147 of the Income Tax Act, 1961 On going through the ITD System and AIR Information available in this office it is seen that the assesses Ms. Davinder Kaur Marwah, has deposited cash of Rs. 21,10,000/- in Bank Account maintained with Punjab & Sind Bank during the F.Y. 2010-11 relevant to A.Y. 2011-12. On verification of data base of the department and information available with the undersigned it has been noticed that the assessee had not filed his Income tax Return for the Asstt Yr. 2011-12. Since the assessee had not filed his ITR for the Asstt. Yr. 2011-12, the source of cash deposits made by him cannot be examined verified. As the assessee has not furnished his ITR for the assessment year under consideration, the verification of the information that the assessee has deposited cash of Rs. 21,10,000/- in bank account maintained with Punjab & Sind Bank. is not feasible. System Generated letter issued on 21/02/2018, to the assessee for furnishing her response and a request vide letter dated 12/03/2018 was also made to the assessee to furnish copy of the Income tax Return for the Asstt, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....so disposed of on 26.11.2018. Thereafter, the AO issued notice u/s. 143(2)/142(1) of the Act to the assessee on 26.11.2018. However, since there was no compliance from the side of the assessee, the AO after considering the material available on record and observing that the assessee has made cash deposit of Rs. 21,10,000/- in her saving bank account maintained with Punjab & Sind Bank, 18, Vaishali, IInd Floor, Pitampura Delhi-110088, made addition of the same to the total income of the assessee. The AO accordingly determined the total income of the assessee at Rs. 24,13,640/-. 3. Before the ld. CIT(A), the assessee apart from challenging the addition on merit, challenged the validity of reassessment proceedings. However, the ld. CIT(A) was also not satisfied with the arguments advanced by the assessee and upheld the validity of reassessment proceedings as well as the addition on merit. 4. Aggrieved with such order of the Ld. CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds:- 1. The Ld. AO erred in law and on facts in initiating the proceedings and framing the assessment u/s. 147 of the Act and the Ld. CIT (Appeals) erred in law a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at the AO has not applied his mind while reopening the case. It is evident from the record that although the assessee has filed her return of income, however, the AO has mentioned that the assessee has not filed her return of income. Even after, copy of the return was filed before the AO during the assessment proceedings, again the AO has mentioned in the order while disposing of the objections, the copy of which is placed at pages 28 to 33 of the paper book that the objection of the assessee is devoid of any merit. Relying on the following decisions, she submitted that the reopening of assessment on the basis of wrong and incorrect facts is not valid. i. ACIT vs Asis Plywood P. Ltd. (ITA No. 2144/Del/2015), dt. 28.01.2019 ii. Krissh Impex Pvt. Ltd. Vs Ito ITA No. 7610/Del/2019, dt. 29.10.2020 iii. Deepak Gupta & Sons vs ITO W.P. 3344/Del/2018, dt. 10.01.2019 iv. Pr. CIT vs RMG Plyvinyl (I) Ltd., ITA 19/2017 Dt. 07.07.2017 (Del HC) 6. In her next plank of arguments, the ld. Counsel for the assessee submitted that the approval for reopening of the assessment u/s. 148 as prescribed u/s. 151 was received by the AO from PCIT. Referring page -7 of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... CIT(A). 10. I have heard the rival arguments made by both the sides, perused the orders of the AO and the Ld. CIT(A) and the paper book filed on behalf of the assessee. I have also considered the various decisions cited before me. I find the AO in the instant case has reopened the assessment on the ground that the assessee made cash deposit of Rs. 21,10,000/- in her saving bank account maintained with Punjab & Sind Bank and has not filed her return of income. The reasons recorded for such reopening of the case of the assessee has already been reproduced in the preceding paragraph. However, a perusal of the paper book filed on behalf of the assessee shows that the assessee has in fact filed her return of income for the impugned assessment year on 25.07.2011 vide Acknowledgment No. 001015 dated 25.07.2011. Even the AO also acknowledged in the first page of the assessment order at para-2 that the assessee has filed reply along with manual return filed by the assessee on 25.07.2011 declaring total income of Rs. 3,03,640/- for AY 2011-12, which is placed on record. The relevant observation of the AO reads as under:- "2. Accordingly, the case was reopened for assessment aft....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the Tribunal in the case of Krissh Impex Pvt. Ltd. vs ITO, vide ITA No. 7610/Del/2019, dt. 29.10.2020 has observed as under:- "7. After considering the rival submissions and on perusal of the material on record specifically with regard to validity of proceedings u/s. 147 as argued before us, it is seen that the Assessing Officer in the reasons has categorically mentioned that no return of income was filed for Assessment Year 2010-11. It is from the perusal of return of income for Assessment Year 2009-10 and 2011-12, he has drawn a presumption that since authorized share capital has been increased from Rs. 1 lac in Assessment Year 2009-10 to Rs. 30 lac in Assessment Year 2011-12. He has no information or record regarding Assessment Year 2010-11, whether assessee had received any share capital or not or any return of income was filed or not. Even at the time of seeking approval u/s. 151, it has been categorically mention that in item no. 8 that ITR has not been filed. Based on this recommendation and Assessing Officer's satisfaction, approval has been granted that it is a fit case for issuing notice u/s. 148, whereas the fact of the matter is that income tax....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... by scrutiny under Section 143(3) of the Act. [See Asst. Commissioner of Income Tax v/s. Rajesh Jhaveri Stock Brokers (P) Ltd., (SC) 291 ITR 500 and PCIT v/s. M/s. Shodimen Investments (Bombay) 2018 (93) Taxman.Com 153]. Further, the reasons to believe that income chargeable to tax has escaped Assessment must be on correct facts. If the facts, as recorded in the reasons are not correct and the assessee points out the same in its objections, then the order on objection must deal with it and prima facie, establish that the facts stated by it in its reasons as recorded are correct. In the absence of the order of objections dealing with the assertion of the Assessee that the correct facts are not as recorded in the reason, it would be safe to draw an adverse inference against the Revenue." 16. I find the Hon'ble Delhi High Court in the case of Pr. CIT vs RMG Polyvinyl (I) Ltd. vide ITA No. 19/2017, dt. 07.07.2017 (Del HC) has observed as under:- "11. There can be no manner of doubt that in the instant there was a failure of application of mind by the AO to the facts. In fact he proceeded on two wrong premises - one regarding alleged non-filing of the return and the othe....