TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 680
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....x Appellate Tribunal, "A" Bench, Kolkata (the Tribunal) in ITA No.757/Kol/2022 to ITA No.759/Kol/2022 for the assessment years 2011-12, 2012-13 and 2013-14. Since the facts and circumstances in all the three appeals are identical and the correctness of the order passed by the learned Tribunal which is a common order is challenged in all the three appeals, they are heard analogously and are disposed of by this common judgment and order. 2. The substantial questions of law suggested by the revenue are also identical and, therefore, ITAT/84/2025 is taken as lead case which relates to the assessment year 2011-12. 3. The revenue has raised the following substantial questions of law for consideration : "a) WHETHER in facts and in the circumst....
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....ly all material facts, reopening of assessment was justified ? d) WHETHER the Learned Income Tax Appellate Tribunal was justified in law in quashing the reopening of the case U/s. 147 of the Act and in not adjudicating the merits of the case when there is the involvement of the issue of bogus purchase by the assessee? e) WHETHER the Learned Income Tax Appellate Tribunal was justified in law in not considering that the transactions involved in the case were not only of highly suspicious nature, but the same were also bogus in terms of the well settled principles of circumstantial evidence and preponderance of probability as elicited by the Hon'ble High Court at Calcutta in the case of Swati Bajaj (2022) 139 taxmann.com 352 (Calcutt....
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.... Pvt. Ltd. (hereinafter referred to as 'Sancheti') which was having huge turnover but declared meager profit and there was no proper business premises and the key person of Sancheti had given a statement wherein he is alleged to have been accepted to be engaged in providing of entries of bogus purchases. It further appears that the Investigation Wing stated that the assessee company has entered into transaction of purchase of goods from Sancheti during the three assessment years and this led to issuance of notice under section 148 of the Act for reopening the assessment. The reasons for reopening were furnished and the assessee submitted their objections and the objections were disposed of by a speaking order. Thereafter, the reassessment p....
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....t match with the financial profile and seems suspicion and for every year huge credits and debits are outstanding which also further raises suspicion. The Hon'ble Supreme Court in Lakhmani Mewal Das, (1976) 103 ITR 437 (SC) held that the word contained in the statute is reason to belief or not reason to suspect. Suspicion of the Assessing Officer towards the possible escapement would not permit to reopen a completed assessment in defiance of the statutory requirement of substantial nature. If the Assessing Officer did not have reason to believe that income has escaped assessment on account of failure on the part of the assessee to fully and truly disclose all material particulars for the assessment, the reopening could not have been done, t....
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....fied in holding that the reopening was carried out based on borrowed satisfaction and mere change of opinion. In Ganga Saran and Sons P. Ltd. vs. ITO, [1981] 130 ITR 1 (SC), it has been held that two distinct conditions were to be satisfied before the Assessing Officer can assume jurisdiction to issue notice under section 147 of the Act, the first reason to believe is that income of the assessee has escaped assessment. The important words in the said section 147(a) are "has reason to believe" and these words are stronger than the words "is satisfied". The belief entertained by the Assessing Officer must not be arbitrary or irrational. It must be a reasonable or in other words, it must be based on reasons which are relevant and material. Tho....
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....nue did not dispute the business transactions of the assessee. The statement said to have been recorded from the key person of Sancheti appears to have been the sole basis for issuance of the notice for reopening. The said statement has been retracted by the deponent within less than a month and neither the Assessing Officer nor the CIT(A) has dealt with the fact of retraction. The learned Tribunal has considered this aspect and has pointed out that the said person had filed an affidavit retracting the contents of the statement made on 14.1.2017 and 17.1.2017 stating that he was under tremendous stress and trauma and was not in a proper state of mind and was without sleep and proper food and that the statement was dictated by the Officer-in....