TaxTMI 
TaxTMI 
2025 (12) TMI 61
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....2. Brief facts of the case are that the assessee company engaged in business of building complete constructions or parts thereof and civil engineering. For assessment year 2012-13, the company filed its Return of Income on 28.09.2012. The case was selected for scrutiny and the final assessment order in the case was passed on 03.03.2015 at an assessed income of Rs. 9,17,64,480/-. Information was received from the ITO, Ward-1(10(4), Surat regarding bogus transaction carried out by the company to divert its income. As per the letter dated 30.05.2018 from the respective ITO, Ward-1(10(4), Surat the name of M/s. Mili Exim Pvt. Ltd.(PAN AAGCM110J) was appearing in the list of Nonfilers of ITR under NMS Cycle-2 in his Ward. As per ITS details of M/s Mili Exim Pvt. Ltd., M/s. Centrodorstroy (India) Pvt. Ltd. (PAN: AADCC0273D) had paid contract receipts of Rs. 46,32,72,000/- to M/s. Mili Exim Pvt. Ltd. during assessment year 2012-13 and deducted TDS of Rs. 92,65,440/- thereon. However, M/s. Mili Exim Pvt. Ltd. had not filed its ITR for assessment year 2012-13. Therefore, the case was reopened within the meaning of section 147 of Tax by the ITO, Ward-1(10(4), Surat. Several field enquiries w....
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....ng aggrieved, the appellant/revenue preferred present appeal with following grounds: "1. Whether Ld. CIT(A) has erred on question of law and the facts and circumstances of the case by allowing the appeal of the assessee ignoring the fact that the addition of Rs. 46,32,72,000/- against payments made to M/s Mili Exim Pvt. Ltd. was made by the assessing officer in light of the fresh information shared by ITO Ward 1(10)(4), Surat stating that M/s Mili Exim Pvt. Ltd. was identified as a non-filer and during the course of assessment proceedings for A.Y. 2012-13 in the case of the said company, notice issued under sectionl48 by ITO Ward 1(10)(4), Surat returned unserved with postal remarks 'not known'. Further the registered director of the company M/s Mili Exim Pvt. Ltd. -Sh. Naresh Mangilal Dave stated in his statement recorded by DDIT Investigation Unit 111(2), Mumbai on 28.08.2014, admitting the fact that he never worked as contractor or sub-contractor in field of civil construction. He further admitted that he had never been director of any company and mentioned that two years earlier someone from his friend circle has asked him to provide his personal documents like....
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....2-1997]. 6.1 The demand for cross-examination of witnesses & parties from whom information is collected under Sections 131 or 133(6) based on which additions are proposed where the incriminating material had already been provided by the Courts is unjustified. 6.2 On the issue of cross examination, the Hon'ble SC in the case of Ayubkhan Noor khan Pathan v State of Maharashtra & others CIVIL APPEAL NO. 7728 OF 2012 may also be considered. The below mentioned lines of judgement are important: "A party, who does not want to controvert the veracity of the evidence on record, or of the testimony gathered behind his back, cannot expect to succeed in any subsequent grievance raised by him, stating that no opportunity of cross-examination was provided to him, specially when the same was not requested, and there was no dispute regarding the veracity of the statement. (See also: Union of India v. P.K. Roy, AIR 1968 SC 850; and Channabasappa Basappa Happali v. State of Mysore, AIR 1972 SC 32)." 6.3 Similar is position in the cases of (a) Kisanlal Agarwalla v. Collector of Land Customs AIR 1967 & Cal. 80; & (b) PCIT vs. Swati Bajaj, Hon Kolkata HC (2022) 139 taxmann.com 35....
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....ot made. 7.1 In present case, it is an undisputed fact that the Return of Income was filed by the Assessee and notices issued u/s 142(1) and 148 were duly adhered during the course of original as well as reassessment proceedings. Thus, the first three exclusionary provisions for falling out of the time limit of four years from the end of the assessment year for issuance of notice u/s 148 stand unfulfilled. 7.2 With regards to Full & True disclosure of all material facts which were necessary for scrutiny assessment, there is no finding by the AO in the reasons recorded for forming a belief of income escaping assessment that what was the failure on the assessee's part in disclosing or submitting complete and true particulars. There is no mention of any specific detail which was called for by the AO during Original Assessment proceedings and was not complied with assessee. The same is evident from para 7, 8 and 9 of the reasons recorded placed at PB Pq 87D-87E 7.3 Detailed verification was conducted by the AO during the course of original assessment proceedings evident from the documents placed at PB Pg 39-61 that transactions undertaken with M/s. Milli Exim Pvt. Ltd. had....
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.... * Noida Toll Bridge Co. Pvt Ltd. versus ACIT Circle-18 (2), Noida and (vice-versa), 2023 (8) TMI 1510-ITAT Delhi, Dated:-8-8-2023. 7.7 When there is no fresh tangible due material distinct from what was very much available, the re-opening in such circumstance is impermissible and Assessment proceedings cannot be initiated on basis of mere change in opinion 7.8 The assessee has already been scrutinized under section 143(3) of the act wherein the Id. AO has assessed the income of the assessee at Rs. 9,17,64,480/- by making disallowance of Rs. 7,60,000/- on account of un-vouched expenses (Assessment order dated 03.03.2015 passed u/s 143(3) is attached at PB pg. no. 62-66). 7.9 During the original assessment proceedings, the transactions with M/s.Milli Exim Pvt. Ltd. was also duly verified by the AO as evident from the query raised by the AO in its show cause notice dated 31.12.2014 (PB Pg. 36- 38) with respect to the transaction with MEPL and sought the various information of the transaction undertaken. In response to the query of AO assessee vide his reply placed at PB Pg 39-42 duly explained the transaction undertaken with MEPL a and furnished the following docume....
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.... of the Income Tax Officer, Surat. The information received from the ITO Surat formed the sole basis for reopening the case, with no evidence of any independent inquiry by the Ld. AO. During the course of original assessment proceedings, assessee in response to the show cause notice dated 31.12.2014 submitted Acknowledgement of income-tax return along with computation of income, audited financial statements, tax audit report, detail note on transaction with M/s. Milli Exim Pvt. Ltd., Tri-party agreement between assessee. M/s Reliance Infrastructure Ltd and M/s Milli Exim Pvt. Ltd. Bank A/c statement, Invoices raised by the assessee to M/s Reliance Infrastructure Ltd. The assessee has consistently submitted that the payment of Rs. 46,32,72,000/-was received by the assessee from M/s. Reliance Infrastructure Ltd and the same amount has been paid to M/s. MEPL on back-to-back basis transaction Therefore, the said amount of 46.32,72,000/- cannot be considered as income of the assessee by any stretch of imagination, which is evident from the bank statements already submitted during the course of original assessment proceedings. All the details submitted were duly accepted by the AO and no....
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.... d. SSG Mercantile Pvt. Ltd. versus ACIT, Circle-24(1), New Delhi, 2021 (1) TMI 949 - ITAT, Delhi, Dated, January 14, 2021. e. Well Trans Logistics India Pvt. Ltd. v. ACIT & Ors., 2024 (9) TMI 156, Hon'ble Delhi High Court, dated, 2-9-2024 f. Natraj Products P. Ltd. v. ITO, Ward-17 (4), New Delhi, 2024 (10) TMI 86-ITAT, delhi, dated, 30-9-2024 g. Smt. Sarla Devi Nigam v. ITO-1 (1), Agra, 2018 (5) TMI 1540-ITAT, Agra, dated, 23-5-2018 7.12 Approval under section 151 of the Act is mechanical-Notice issued u/s. 148 without obtaining prior valid approval u/s. 151 of the Act will be considered as invalid and liable to be quashed. Ld. AO has initiated the reassessment proceedings against the assessee u/s 147 of the act on the basis of information received from ITO Ward, Surat. It is to be highlighted that the reopening of assessment in the case of the assessee is not tenable in the eye of the law as no prior valid approval has been received u/s 151 of the Act. It is settled law that while granting approval, the authority must analyze and explain why the case should be reopened. A mere notation of "approved" or "Yes, I am satisfied does not fulfil....
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.... of CBDT Circular No. 19/2019 dated 14.08.2019. Reliance can be placed on the following judicial pronouncements wherein it is held that absence of DIN, the assessment order will be null and void and liable to be quashed: (a) M/S Brandix Mauritius Holdings Ltd. v. DCIT Circle-1(1)(2), 2022 (11) TMI 34-ITAT Delhi, Dated -19-9-2022; (b) SHEENA JAIN V. DCIT, CENTRAL CIRCLE-5, DELHI, 2024 (2) TMI 628-ITAT DELHI, Dated:-3-1-2024; & (c) M/S Bilasa & Sons Pvt Ltd V. ACIT, Central Circle-14, 2023 (12) TMI 874-ITAT DELHI, Dated: 31.11.2023." 8. On examination of record in light of above said rival contentions, it is crystal clear that the assessee company had filed return of income on 28.09.2012. Copy of acknowledgement of ITR with computation of income is at page nos. 1 to 4 of the paper books. The case was selected for scrutiny assessment during scrutiny proceedings under Section 143(3) of the Act. The assessee submitted its ITR acknowledgement, computation of income and audited financial statements. Ld. AO issued show-cause-notice dated 31.12.2014 at page nos. 36 to 38 of the paper books. Specific queries regarding transactions entered with M/s. Mili Exim Pvt....
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....ns between the assessee and M/s Milli Exim Pvt. Ltd were bogus, relying entirely on information received from the ITO Ward 1(10(4)), Surat. It is a settled principle that the information received from the other Income Tax Officer cannot be said to tangible material per se without any further enquiry being undertaken by the AO to establish the link between the tangible material and formation of reason to believe that income had escaped assessment. Reliance is placed on the following judicial pronouncements wherein it has been held that in the absence of independent application of mind by the Ld. AO, assessment cannot be reopened on the basis of report of the Investigation Wing. a. PRINCIPAL COMMISSIONER OF INCOME TAX-6 VERSUS MEENAKSHI OVERSEAS PVT. LTD. 2017 (5) TMI 1428-DELHI HIGH COURT, Dated: - May 26, 2017 b. PCIT V. RMG POLYVINYL (1) LTD., 2017 (7) TMI 371-DELHI HIGH COURT, DATED-JULY 7, 2017 c. M/S SAVITA HOLDINGS PVT. LTD. VERSUS ITO WARD 22 (4) NEW DELHI., 2021 (3) TMI 833-ITAT DELHI, DATED MARCH 19, 2021 d. SSG MERCANTILE PVT. LTD. VERSUS ACIT, CIRCLE 24(1), NEW DELHI, 2021 (1) TMI 949 - Income Tax Appellate Tribunal DELHI, DATED JANUARY....