TaxTMI 
TaxTMI 
2021 (1) TMI 1352
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....7 of the Income Tax Act, 1961 (the Act) concerning AY 2011-12. 2. The grounds of appeal raised by Revenue read as under: "1. The Ld. CIT (A) has erred in law and on facts of the case in deleting the addition of Rs. 84,20,58,519/- made by the A.O. towards the purchase of Castor seeds/Soda seeds on NSEL Platform. 2. On the facts and circumstances of the case, the Ld. Commissioner of Income-tax (A) ought to have upheld the order of the Assessing Officer in respect of above issues." 3. When the matter was called for hearing, the learned senior counsel for the assessee in the captioned Revenue's appeal referred to the reasons recorded for initiating the proceedings under s. 147 of the Act and submitted that the reasons recorded woul....
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....e Gujarat High Court CIT v. Mohmed Juned Dadani (2014) 355 ITR 172 (Guj) which according to him squarely clinches the issue. The learned senior counsel thus submitted that the order of the CIT (A) granting relief to the assessee cannot be faulted. 4. The ld. CIT. DR for the Revenue, on the other hand, relied upon the action of the AO and submitted that the power of the AO is not curtailed for making the impugned additions under s. 147 of the Act. 5. We have carefully considered the rival submissions. We shall straightway address ourselves to the validity of additions made pursuant to jurisdiction assumed under s. 147 of the Act on a ground altogether different from the ground for which reasons towards escapement was recorded under s. 148(....
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.....98 lakh as detailed below: Description Amount Rs. In Lakh Surcharge @5% 6.70 Total 140.60 Education Cess @3% 4.22 Total Tax 144.82 Interest u/s 234A for one month 1.45 Interest u/s 234B from 1.4.2011 to 21.11.2014 @44% 63.71 Total Short levy of tax 209.98 Under assessment of income 446.34 Income Tax @30% 133.90 Thus, it is a fit case for reopening of assessment u/s 148." 7. The CIT (A) has dealt with the issue in favour of the assessee and has set aside the additions carried out by the AO on a different ground having regard to the fact that no additions were made for the grounds for which the assessment was reopened under s. 148 r.w.s. 147 of the Act. The relevant operative para of the order of the CIT (A) is ....
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....9,70,236/- on NSEL platform through barter system. A perusal of the reasons recorded by the AO for reopening the assessment proceedings for Asst. Year 2011-12 i.e. the year under consideration shows that the specific reason recorded by the AO for reopening the case was that an amount of Rs. 446.34 lakhs had been debited by the appellant to the profit and loss account on account of loss from F&O which was allowed during the course of original assessment proceedings and which was required to be disallowed. Thus, the AO had recorded that he had reason to believe that income to the tune of Rs. 446.34 lakhs had escaped assessment. Therefore, it is very clear that the only reason recorded for reopening the assessment proceedings was the....
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....9;ble Delhi High Court in the case of CIT Vs. Monarch Educational Society 79 Taxman.com 43 has also taken a similar view and has held that if no addition is made in respect of reasons recorded by the AO for reopening assessment, then the AO cannot make an addition on any other issue in re-assessment proceedings. 4.2.5 In this case, the assessment proceedings were reopened by the AO as per the reasons recorded by him on the issue of F&O losses debited to the profit and loss account. The addition however has been made on account of purchases made on NSEL platform without consideration. This issue on which the addition has finally been made does not form part of the reasons recorded by the AO. Nowhere during the proceedings has the AO recor....