TaxTMI 
TaxTMI 
2025 (9) TMI 582
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....referred to as 'the Act') for the Assessment Year (AY) 2017-2018. 2. There is a delay of thirty days in filing the present appeal. An application has been filed for condonation of delay. Considering the averments made in the application as well as the shortness of delay, the delay in filing the appeal is hereby condoned. 3. The assessee, in this appeal, has mainly contested the validity of reopening of the assessment by the Assessing Officer (AO) u/s. 147 r.w.s.148 of the Income Tax Act, 1961 (hereinafter referred to as "the Act"). Since this legal issue goes to the root of the case and hit at the very validity of the assessment order, therefore, we proceed to adjudicate first this issue. 4. At the outset, the Ld.Counsel for the as....
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....escaped assessment to the tune of Rs. 64,05,601/-. He accordingly re-opened the assessment and issued notice to the assessee u/s. 148 of the Act. The assessee filed objections against the reopening of the assessment vide letter dated 01/11/2021, which were disposed of by the AO vide his order dated 27/01/2022. The Ld.Counsel for the assessee, while bringing our attention to the assessment records, has pointed out that the assessee during the year had not taken any accommodation entry from the Kaushal Group. He, however, had traded in the shares of the Kaushal Ltd. which were fully disclosed in the original return of income filed u/s. 139(1) of the Act. It has been further submitted that the return of the assessee was selected for scrutiny a....
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....es of Kaushal Group. He has further submitted that the issue of validity of reopening of the assessment has been thoroughly examined by the Ld.CIT(A) in para No.5.5 of the impugned order of the CIT(A). The Ld.DR further submitted that the Ld.CIT(A) has also discussed the issue of validity of reopening of the assessment vide his observations made and dismissed the issue regarding the validity of the assessment in para Nos.6 & 6.4 of the impugned order. He submitted that the Ld.CIT(A) observed that the assessee had shown bogus STCG by taking benefit of price rigging of that script by Kaushal Group. The Ld.DR further submitted that, time and again it has been held by the higher Courts including the Hon'ble Supreme Court that not only the incri....
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....ve, the Assessing Officer, in this case, has reopened the assessment solely on the basis of the information available on the insight portal of the department without verifying the veracity and truthfulness of such information. Hon'ble Supreme Court in the case of "Dr. Jagmittar Sain Bhagat & Ors vs Dir. Health Services, Haryana" in Civil Appeal No.5476 of 2013 decided on July 11, 2013, while relying upon another decision of the Hon'ble Supreme Court in the case of "Sushil Kumar Mehta v. Gobind Ram Bohra" (1990) 1 SCC 193 and further placing reliance on the other decisions of the Hon'ble Supreme Court in the cases of "Premier Automobiles Ltd. v. K.S. Wadke & Ors.", (1976) 1 SCC 496; "Kiran Singh v. Chaman Paswan", AIR 1954 SC 340; and "Chand....
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.... or circumstantial evidence but not on mere suspicion, gossip or rumour. The Income-tax Officer would be acting without jurisdiction if the reason for his belief that the conditions are satisfied does not exist or is not material or relevant to the belief required by the section. Such an action of the Assessing Officer regarding formation of belief of escapement of assessment and thereby in starting proceedings u/s 147 is open to challenge in a court of law. The entire law as to what would constitute "reason to believe" has been summed up by the Hon'ble Supreme Court in the case of "Income Tax Officer vs. Lakhmani Mewaldas" (1976) 103 ITR 437. Reliance in this respect can also be placed on the decision of the Hon'ble Punjab & Haryana Hi....