TaxTMI 
TaxTMI 
2025 (12) TMI 724
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....ee placed reliance on the decision of the Third member of Delhi Bench in the case of Mahesh Kumar Vs. ITO in ITA No. 2650/Del/2024 order dated 06.08.2025. 3. On the other hand the learned DR supported the orders of the authorities below. 4. Heard the rival contentions and perused the orders of the authorities below. In this case notice u/s. 148 was issued for reopening of assessment and the reasons for reopening of assessment was given as under :- REASONS FOR RE-OPENING OF CASE U/S 147 OF THE IT, ACT 1961 In this case, an information has been received from the DDIT(Inv.)-1, Ludhiana through e-mail on 29.03.2019 vide latter DDIT(Inv.)-1/Lodhi/18-19/2117-2139 dated 29.03.2019 for the F.Y. 2011-12 relevant to the A.Y. 2012-13. The information received from the DDIT(Inv.)-1. Ludhiana is reproduced as under : While monitoring of transactions, we had Identified the account in the name of M/s Shreyans International (910020008476787), wherein Mr. Rajeev Mehan is the proprietor. (ii) A trend of credits in the form of RTGS inward, foreign inward remittance and transfer followed by debits by way of transfer, cash withdrawal and mainly inward ....
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....has neither provided the details of business activities carried out by him during the period 01.04.2011 10 31.03.2012 nor produced/submitted requisite documents/information/ books of accounts despite ample opportunities and thereby unable to explain the source/nature of transactions appeared in the above mentioned breik accounts. 3: Subsequently, summans u/s 131(A) of 11. Act, 1961 was also issued to Sh. Sunil Kumar, Prop. M/s Siful Knitwears and Sh. Parumjit Singli, Prop. Mis Pink Pearl Garments for furnishing of confirmed copy of account of M/s Shreyas International und M/s Sifat Knitwears respectively for the FY. 2011-12 alongwith other supporting documentary evidence. In response thereto, Sh. Paramjit Singh Prop M/s Pink Garments appeared and his statement recorded on oath u/s 131(14) of 1I.T. Act, 1961. During the course of recording of his statement, he has stated that one Sunil Kumar Sharma Prop. M/s Sifat Knitwears got the bank account opened from him fraudulently and got blank cheques-signed an both sides. He further stated that he had not done any business with Sh. Sunil Kumar Sharina Prop. M/s Sifat Knitwears and no sale purchase have been made by him with M/s S....
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.... IT Act for A.Y. 2012-13. ITO, Ward-33(3), New Delhi. JCIT, Range 33, New Delhi 1 As per fa-384,04,298/- (3,82,60,00 + 1,44,201) 2 AS par books/CITC(A) → 3,82,60,000/- 5. Based on the reasons the assessment was reopened and the reassessment was completed on 31.12.2019 u/s. 143(3) r.w.s. 147 of the Act making various additions including the addition for which the assessment was reopened i.e. alleged receipt of accommodation entry from M/s. Shreyas International during the F.Y. 2011-12 relevant to assessment year under consideration i.e. 2012-13 for an amount of Rs. 3,14,16000/-. We observed that though in the reasons the AO stated that the assessee has taken accommodation entry for an amount of Rs. 3,14,16000/-, however, while completing the assessment an addition of Rs. 3,84,04,298/- was made. On perusal of the assessment order we observed that the AO not only made addition of Rs. 3,84,04,298/- in respect of the transaction i.e. alleged accommodation entries received from Rajiv Mehen ( M/s. Shreyas International) also made other additions in respect of loans obtained by the assessee from D.K. Jain and in respect of various other loans from vari....
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.... account in the form of loan or advance. On the contrary, it is a case, where the appellant, in the preceding assessment year, had given advance to M/s Shreyas International, and during the year has advanced further sums, and M/s Shreyas International has returned such sums to the appellant during the year and in succeeding assessment year. All the aforesaid transactions have been undertaken through the respective bank accounts. In such circumstances, return of loan by Mis Shreyas International to the appellant during the year cannot be termed as unexplained money u/s 69A of the Act. 12.4 It is further relevant to note that though the return of advance of Rs. 3,84,04,298/-in this assessment year i.e. AY 2012-13 has been disputed by the Assessing Officer, however return of advance of remaining balance of Rs. 3,64,82,259/-in the succeeding assessment year, AY 2013-14, has been accepted. This fact further strengthens the conclusion that sums received by the appellant during the year from M/s Shreyas International was nothing but the return of advance by from M/s Shreyas International, and hence the same is outside the purview of section 69A of the Act. In the case of Pr....
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....entical issue came up for consideration before the Hon'ble Third Member in the case of Mahesh Kumar Vs. ITO in ITA No. 2650/Del/2024 dated 06.08.2025 wherein Ld. Third Member agreeing with the view of the learned Judicial Member, held as under :- This reference under section 255(4) of the Income-Tax Act, 1961 ('Act for short) arises on account of difference of opinion between two learned Members of the formulated for being decided by the Third Member : "Whether, in the given facts and circumstances of the case, the reopening under Section 147 read with Section 148 of the Act is valid or not where the Assessing Officer made addition independently of other income which does not form the subject matter of reopening and where addition made by the Assessing Officer on the basis of reasons recorded for reopening were deleted by the CIT(A) and no addition of that income on the basis of reasons recorded survives which has reason to believe had escaped assessment and which formed the basis of reopening." 2. The brief facts are that the assessee was an employee with the Municipal Corporation of Delhi and, inter olio, had salary income. The assessee filed his Return....
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....reopening were deleted by Ld. CIT(A) and thus, no additions on the basis of reasons recorded for reopening survives in case of assessee." The difference of opinion between the learned Members has arisen in the context of the aforesaid ground. 5. The learned Vice President (Judicial Member) placing reliance on the decision of Bombay High Court in CIT vs Jet Airways (I) Ltd., 331 ITR 236 (Bom) and jurisdictional Delhi High Court decision in ATS Infrastructure Ltd. vs ACIT, 473 ITR 595 (Delhi) has found that once the addition made on account of original reasons recorded (in this case, the addition on account of alleged bogus LTCG is deleted, the other two additions, which were not part of original reasons recorded, cannot be sustained. The learned Accountant Member, by his dissenting order, has found that the decision in Jet Airways (I) Ltd. (supra) and ATS Infrastructure Ltd. (supra) are distinguishable on facts and cannot be called into aid to delete the balance additions. 6. It is submitted by the learned counsel for assessee that once the addition made by the Assessing Officer relying on the reasons recorded is deleted, no other addition can be sustained....
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....,000/- under Section 68 of the Act on account of deposit of cash/cheques which went unexplained and Rs. 20,62,375/- being unexplained expenditure on purchase of property under Section 69 of the Act. The learned CIT(A) has deleted the addition on account of the alleged bogus LTCG which was the original basis of the reopening. However, the learned CIT(A) has sustained the other two additions. The question is whether the reassessment can be sustained in such circumstances. 10. I have carefully gone through the differing orders passed by the learned Members of the Bench. While the learned Judicial Member has placed reliance on the decision, viz. ATS Infrastructure Ltd. (supra), B.P. Poddar Foundation for Education (supra) and Jet Airways (I) Ltd. (supra), the learned Accountant Member has found that the decisions in the case of ATS Infrastructure Ltd. (supra) and Jet Airways (I) Ltd. (supra) are distinguishable on the ground that in those cases the Assessing Officer himself had not made any addition on the basis of the reasons recorded for reopening. In other words, the learned Accountant Member has made a distinction between the cases where the Assessing Officer did not make ....
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....which would be tested in the event of a challenge by the assessee." 13. Thus, the distinction sought to be made out by the learned Accountant Member, in my considered opinion, cannot be accepted, 14. The learned Accountant Member in para 3.4 of his order has found that the case of B.P. Poddar Foundation for Education (supra) decided by the Kolkata Bench involves identical facts. Incidentally, the decision in the said case has been confirmed by the Calcutta High Court. This aspect has been considered by the learned Accountant Member in para 5 onwards of his order. Before the Calcutta High Court, the Revenue had raised the following substantial question of law :- (i) Whether on the facts and circumstances as well as in law the Income-tax Appellate Tribunal was correct in law in holding that the other additions made in the order under section 147/143(3) of the Income-tax act, 1961, which were not part of the reasons recorded for reopening the assessment were not sustainable in the eyes of law even after insertion of Explanation 3 to section 147 of the Act by Finance Act, 2009 when addition was made by the Assessing Officer on the ground of reopening? ....
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.... 16. In my considered view, once the learned Accountant Member had found that the facts in the case of B.P. Poddar Foundation for Education (supra) were identical, it was not open to express any contrary view. That being an order of the co-ordinate Bench was binding. 17. The learned Accountant Member has also reproduced in para 3.2 of the order the observations of learned CIT(A) while deleting the addition in respect to bogus LTCG. The learned Accountant Member found that the findings are "a little abrupt". Although the reasons given by the learned CIT(A) could have been more specific and clear, the said aspect cannot be gone into for the reason that ultimately the learned CIT(A) has partly allowed the appeal and deleted the addition and that order has not been challenged by the Revenue and has thus attained finality. 18. In the result, Ground no. 3 as raised by the assessee deserves to be allowed and the impugned addition cannot be sustained. The question as referred to is answered accordingly, holding that the reopening u/s 147 r.w.s 148 of the Act, in this case, is not valid. The appeal, therefore, deserves to be allowed as proposed by the learned Vice ....