TaxTMI 
TaxTMI 
2023 (2) TMI 358
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.... firm came into existence in the financial year 2016-2017 (Assessment year 2017-2018) and since then it is engaged in the business of textile job work at Pali. The petitioner filed its original return of income in terms of Section 139 (1) of the Income Tax Act, 1961 for the assessment year 2017-2018 on 30.09.2017 and the same was verified by the respondent Department without any defect. After filing of the return of income for the Assessment Year 2017-18, a notice/summon dated 24.08.2017 under Section 131 (1A) of the Income Tax Act was issued to the petitioner for making an enquiry in relation to the source of large investment to the tune of Rs.1,21,40,000/- made by the petitioner firm in acquiring immovable property situated at plot No.A-4, Nextgen Textile Park, Sardarsamand Road, Pali. The petitioner filed detailed explanation in prescribed format alongwith documentary evidence in response to the said notice/summon. No further proceedings were forthcoming after the explanation submitted by the petitioner as above. However, a notice dated 31.03.2021 (Annex.5) was served upon the petitioner under Section 148 of the Income Tax Act proposing to reopen proceedings for the assessment y....
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....titioner had not procured any property at Delhi with the description C-152, Nirman Vihar, Delhi for the amount of Rs.1,21,40,000/- during the financial year 2016-2017. It was emphatically mentioned in this letter that the assessee had rather purchased land located at plot No.A-4, Nextgen Textile Park, Sardarsamand Road, Pali for a sum of Rs.1,26,37,900/- from M/s. Nextgen Textile Park, Private Limited having its registered office at C-152, Nirman Vihar, Delhi. This transaction was duly disclosed in the audited financial statement, i.e. balance-sheet and fixed asset chart as well as the return of income filed by the petitioner for the Assessment Year 2016-17. It was asserted that the reasons formed by the A.O. were based merely on suspicion, assumptions and conjectures and there was nothing in the communication dated 28.06.2021, which could suggest that there was any material to support the allegation/assumption of non-disclosure of land transaction. The preliminary objections submitted by the petitioner against the reopening of assessment for the Assessment Year 2017-18 were disposed of by the respondent I.T.O., Ward-1, Pali by order dated 13.09.2021 (Annex.12). The notice under S....
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....annexing therewith the duly audited financial statements, wherein entire details of the subject land transaction are reflected. He submitted that the order dated 13.09.2021 (Annex.12) is erroneous on the face of the record because at point No.2.1, the Assessing Officer has mentioned that the assessee had not uploaded the schedule of fixed assets as mentioned in the schedule 6 in the balance-sheet. He urged that this schedule was duly annexed with the duly uploaded balance-sheet, which fact is not disputed in the reply of the respondents. In this schedule, the transaction to the tune of Rs.1,26,25,900/- for purchase of land situated at Pali is clearly depicted under the column of fixed assets. Shri Kothari, thus, urged that the foundation of the impugned notice and the impugned order being non-existent, the same are liable to be struck down. Shri K.K. Bissa, learned counsel representing the respondents, has filed a detailed reply to the writ petition, wherein the allegations made in the impugned notice; the order indicating reasons to believe and the order disposing the objections are reiterated and highlighted. However, the pertinent assertion of the petitioner that it did not acq....
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.... facts and with sheer non-application of mind. Learned counsel Shri Bissa, in utmost sincerity, tried to justify the impugned notice and the impugned orders urging that the petitioner may contest the assessment proceedings which are faceless in nature and in case, the averments of the petitioner are found to be correct, the assessment can be completed/dropped. Shri Bissa placed reliance on the Delhi High Court judgment in the case of Touchstone Holdings Pvt. Ltd. vs. Income Tax Officer, Delhi & Ors. (W.P.C. No.13102/2021 decided on 09.09.2022) and urged that the sufficiency or correctness of the material is not to be considered at this stage when the matter is before the writ court. The Court cannot strike down the reopening of the case on these grounds and it will be open to the assessee to prove that the assumptions of facts made in the notice were erroneous. The questions of fact and law should be left open to be investigated and decided by the assessing authority. On these submissions, he implored the Court to dismiss the writ petition. Nonetheless Shri Bissa was candid enough in admitting during the course of arguments that the impugned notice dated 31.03.2021 (Annex.5), the ....