2025 (11) TMI 748

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....d nullity in the eyes of law. 03. The brief facts are that the assessee filed the return of income on 17.10.2016, declaring total income at Rs.43,04,040/-, which was processed u/s 143(1) of the Act. Thereafter, on the basis of credible information with the learned AO, the assessment was reopened u/s 147 of the Act on the ground that the assessee has indulged in non-genuine transactions in equity derivatives incurring loss of Rs.98,10,876/- by trading in illiquid stocks option on Bombay Stock Exchange during the previous year. The notice u/s 148 of the Act was issued on 31.03.2021, which was not complied with by the assessee but later the ITR was filed on 23.08.2021. The learned AO noted that the department has carried out detailed invest....

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....Bench to the ledger account of the stock broker (Preferred Securities (P) ltd) for the said period for Bombay Stock Exchange F&O as well as NSE F&O and submitted that the learned AO has completely missed the bus by taking wrong stock brokers instead of preferred securities (P) Ltd. as is apparent from the statement of account as well as contract notes which are available in the paper book from page no.13 to 142 of the Paper Book. The learned Authorized Representative referred to para no. 5.4 of the CIT (A) who also gave a wrong finding that the assessee had appointed a number of stock brokers for caring of F&O trading which is patently and factually wrong. The learned CIT (A) thereafter noted that these stock brokers were carrying out and a....

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....t and therefore, this was another blatant mistake on the part of the learned AO. 06. In our opinion, the AO has to exercise powers as conferred upon him by section 147 r.w.s. 148 of the Act with great care and caution as by exercising the reassessment jurisdiction u/s. 147, the AO unsettles the already completed assessment putting the assessee to a huge inconvenience and harassment. In the present case, the AO has incorrectly reopened the assessment by not even verifying the facts that there were no trades in F & O segments executed by the brokers referred to by the both the authorities. Therefore, considering these facts and circumstances the reopening of assessment is void ab initio and invalid in the eyes of law on the ground of non a....