2024 (9) TMI 148

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....the petitioner has prayed for quashing and setting aside the order dated 29.03.2024 passed under section 148A (d) of the Income Tax Act, 1961 (For short "the Act") for Assessment Year 2018-2019 as well as notice under section 148 of the Act issued on 29.03.2024 for AY 2018-2019. 5. Brief facts of the case are that the petitioner is a partnership firm which was constituted as per the partnership deed executed on 01.04.2017 to carry on the business of trading of cotton yarn and spare parts of textiles machinery related products. 6. The petitioner filed its e-ITR for Assessment Year 2018-2019 on 17.07.2018 declaring total income of Rs. 8,64,480/-. 7. Respondent issued notice under section 148A (b) on 23.02.2024 calling upon the petitioner to show cause as to why the notice under section 148 of the Act should not be issued and was further asked to furnish response on or before 04.03.2024. The reasons given by the respondent Assessing Officer to come to the conclusion that it is a fit case to reopen the assessment as under: "4. In response to the above, the assessee furnished the response on 04/03/2024 along with the details. The submission of the assessee has been dul....

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....ansaction of Rs. 9,71,156/- being represented in the form of assets as defined in explanation to Section 149 of the Act has escaped assessment. 5 Therefore, in light of the above reasons, information and material available on record, I am of the considered view that the assessee has failed to explain the above mentioned transactions and income earned / derived there from, during the year under consideration and therefore, the same remained unexplained. Assessee has failed to discharge the onus cast upon him to prove the genuineness of these transactions and also the source of income for undertaking such huge transactions. Hence, on the basis of material available on record, which establish that the income chargeable to tax in respect of above mentioned unexplained transactions of Rs. 126,03,57,840/- which is being represented in the form of assets (as defined in Explanation to section 149 of the Act), has escaped assessment, amounts to more than Rs. 50 Lakhs for F Y 2017-18 relevant to AY 2018-19 as specified u/s. 149 (1) (b) of the IT Act. Hence, this is a fit case for issuance of notice u/s. 148 of the Act as income chargeable to tax has escaped assessment within the mea....

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.... section 151 of the Act in a mechanical manner and without application of mind. It was therefore, prayed that the impugned order and notice are required to be quashed and set aside. 14. On the other hand, learned advocate Mr. Karan Sanghani for the respondent submitted that the petitioner has shown total income of Rs. 8,64,483/- in the return of income whereas there is total sales/purchase transaction of yarn/cotton amounting to Rs. 126,45,27,615/- and on basis of such variance in turnover and the income offered by the petitioner, information was uploaded on Insight portal by DCIT, Central Circle 1, Ludhiana, on the basis of survey action conducted on premises of Mohit Mittal, Proprietor of Mittal Enterprises, Ludhiana on 05.03.2020 wherein during post-survey enquiries, it was found that said Mohit Mittal was engaged in trading in Cotton Yarn/Cotton scrap and therefore, TCS was required to be deducted by the parties from whom Mohit Mittal has purchased Yarn/Cotton scrap and in the list of purchasers, name of the petitioner was also mentioned with regard to sale of Yarn/Cotton scrap amounting to Rs. 9,71,156/- by the petitioner and no TCS was deducted and therefore, respondent As....

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.... M/s. Rintex Industries of 12,13,400/-, it is agreed by Assessing Officer that same is also shown in books of account. 20. Whereas regard to sales and purchase data from GSTR-I register, the Assessing Officer has observed that the petitioner failed to submit sales and purchase register and therefore, there is escapement of income. In respect of sale of mutual funds of Rs. 8,17,919/-, it was explained by the petitioner that sale was made by the partner and during the year under consideration, the petitioner has not sold any mutual fund. With regard to transaction with Mittal Enterprise, it was observed that sales register was not furnished by the petitioner and the same is escapement of income. However, on perusal of the document placed on record, the petitioner has placed on record the details of Form GSTR-I wherein all the details of sale and purchase as submitted to GST department are provided to the respondent. 21. With regard to Mittal Enterprise Ludhiana also, the petitioner has explained in detail in reply to the effect that such transactions with the said party is duly accounted in the books of accounts and the ledger account was also provided. 22. Considering the f....