TaxTMI 
TaxTMI 
2023 (4) TMI 128
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....brevity, the grounds of appeal are not reproduced. 3. Grounds raised by the assessee/Cross Objector relate to challenging the legality and validity of the reassessment proceedings initiated by the Ld. AO by issuing notice u/s. 148 of the Act based on incorrect, ambiguous and vague information, recorded in the reasons to belief and the assessment so completed u/s. 147 of the Act. 4. At the outset, we note that there is a delay of 283 days in filing the present appeal by the revenue for which a petition for condonation of delay is placed on record, dated 24.03.2021. The impugned order of Ld. CIT(A) is dated 19.02.2020 which was received on 18.03.2020. The limitation to file the instant appeal fell during the period Pandemic of Covid-19 which prevented the revenue to file the appeal within the prescribed limitation. It is noted that the period of delay falls during the time of Pandemic of Covid-19 which has been excluded by the Hon'ble Supreme Court in the case of Suo moto Writ Petition (C) No. 3 of 2020 dated 10.01.2022 by which the period from 15.03.2020 to 28.02.2022 has been directed to be excluded for the purpose of limitation. Vide this order a further period of 90 days has be....
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.... inter alia others. But the inspector failed to locate the officer. It has been found from ITD Data base that Shri Ajay Kumar Bajpei having PAN AKOPB64951 has filed total income of Rs.159225/- in the AY 2010-11. Further it has been found from ITD database that Eastern Financial Consultants Pvt. Ltd. And Pearl Financial Consultants Pvt. Ltd. (new name - Vet Biotech Pvt. Ltd.) has filed total income of Rs.830/- and Rs.806/- respectively for AY 2010-11. All these companies have filed very low returned income that are not supported by their high bank transactions. M/s. MRG Securities Pvt. Ltd. is a beneficiary company which has received fund transfer from M/s Eastern Financial Consultants Pvt. Ltd. and Pearl Financial Consultants Pvt. Ltd. amounting to Rs.25,00,000/- as per the following details: Date Amount Received from 06.11.2009 800000 Eastern Financial Consultants Pvt. Ltd. 06.11.2009 900000 -Do- 09.11.2009 800000 Pearl Financial Consultants Pvt. Ltd. Therefore I have reason to believe that income of RS.25,00,000/- chargeable to tax has escaped assessment." 6.1. In this case, assessee is in the business of purchase and sale of shares . It had an inventory of s....
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....tax had escaped assessment since the addition made was done on the basis of factually incorrect assertion. For this it was demonstrated from the audited financial statement wherein sale of shares to the tune of Rs.1,95,85,000/- has already been offered as income. It was thus, submitted that the reassessment proceedings are invalid on the basis of improper reasons recorded by the Ld. AO which are without applying mind to the information and without independently arriving at a belief. It was submitted that in the reasons recorded, it is alleged that assessee is a beneficiary of Rs.25 lakhs though this sum has been credited in the bank account of the assessee in respect of sale of shares to Eastern Financial Consultant Pvt. Ltd. (Rs. 8 lakh + Rs.9 lakh = Rs. 17 lakh) and to Pearl Financial Consultant Pvt. Ltd. (Rs.8 lakh). This amount has already been offered as income by the assessee duly reported in its audited P&L Account and thus there is no reason for initiation of reassessment proceeding which is absolutely vague and there is complete absence of live link of the formation of belief with the material on record and there being no escapement of income from the assessment. 6.5. In ....
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....he factual aspect. He pointed to the replies made before the Ld. AO which have been reproduced in the order of Ld. CIT(A) at pages 20 and 21. From the said replies, made before the Ld. AO, Ld. Counsel demonstrated that all the details as required by the Ld. AO were furnished in the assessment proceedings in support of the claim made in the return. Such replies are reproduced and extracted as under: 9. Ld. Counsel also objected on the observation of the Ld. AO that assessee is not engaged in any business activities and pointed to the audited P&L Account wherein sale of shares as well as interest income has been reported for the year under consideration as well as for the immediately preceding year. In respect of details of purchasers to whom the shares were sold by the assessee, Ld. Counsel referred to pages 113 to 115 placed in the paper book wherein all the details in respect of name, address, quantity, sale rate, date of sale, reference to bank statement for the sale realisation and the amount realised were furnished before the Ld. AO. 9.1. Ld. Counsel also strongly submitted that purchases made by the assessee have not been held to be bogus transactions by the Ld. AO and, ther....
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....f above factual as well as legal propositions, I am of the considered opinion that the addition made by the Assessing Officer cannot be sustained. Therefore, the ground is allowed." 10.2. We also note that ld. AO has proceeded on fundamentally wrong facts since the amount of Rs. 25 lakh as noted in the reason to believe forms part of the total sale consideration reported in the P&L Account and thus, has come to the conclusion wrongly that income chargeable to tax had escaped assessment. Assessee had pointed out this fact in its objection raised before the Ld. AO who did not consider the same. Similar issue was dealt by Hon'ble High Court of Bombay in the case of Ankit A. Choksey Vs. ITO & Ors. 411 ITR 207 (Bom) who had held that notice issued u/s. 148 was without jurisdiction and therefore, quashed and set it aside. 11. On the issue of legality and validity of reassessment proceeding, we find that Ld. AO has merely repeated the information received from the Investigation Wing without carrying out any verification and the addition made in the reassessment is on the basis of factually incorrect assertions/statements and fundamentally wrong facts as discussed in details above. For o....