TaxTMI 
TaxTMI 
TaxTMI 
2026 (3) TMI 268
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....s claimed, and accordingly the total income was computed at Rs. 5,49,505/-. Thereafter, the AO initiated Reassessment proceedings by issue of notice u/s 148 of the Act based on the information received from Investigation Wing that assessee had made purchases from one M/s Vaishnavi Trading Co. who had admitted that it was providing accommodation entries of bogus bills after charging commission. Based on the admission of Shri Rakesh Agarwal proprietor of M/s Vaishnav Vaishnavi Trading Company, the case of the assessee was reopened after recording the reasons and taking approval from the authorized authority and notice u/s 148 was issued on 29.03.2019. After considering the submissions made and the replies filed by the assessee, reassessment order was passed u/s 147/144 of the Act dated 21.12.2019 by making addition of Rs. 2,12,91,192/- by holding the purchase of the said amount from M/s Vaishnavi Trading Company as unexplained expenditure u/s 69C of the Act. 3. Against the said order, the assessee preferred an appeal before the Ld. CIT(A) who after appreciating the submissions made by the assessee and the facts of the case, has allowed the appeal of the assessee by deleting the ad....
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....stances of the case. 3. That on the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) has erred, both on facts and in law, in not quashing the reassessment order passed under section 147 of the Income-tax Act, 1961, wherein the addition was made solely on the basis of a third-party statement. The assessee was not afforded the opportunity to cross-examine the said person, despite the said statement forming the sole basis of the addition. Such denial of cross-examination amounts to a violation of the principles of natural justice and renders the reassessment proceedings bad in law and liable to be annulled." 6. Since, in the cross objection filed, assessee has challenged the validity of the reopening of the case, therefore, the Cross Objection taken by the assessee are taken first. 7. In the Cross Objection Nos.1 and 2, the assessee has challenged the reopening of the completed assessment based on the borrowed satisfaction and without jurisdiction. 8. Before us, ld. AR for the assessee submits that case of the assessee was reopened after the expiry of four years from the end of the relevant Assessment Year and from....
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....e PCIT, Ghaziabad And not by ITO Ward 46(5), Delhi. The Ld. AR further drew our attention to letter dated 18.11.2019 by ITO, Ward 2(2), Ghaziabad through which case of the assessee stood transferred to Income Tax Officer, Ward- 46(5), New Delhi having jurisdiction over the assessee, the necessary copy of the said letter is placed in the paper book page 165 as obtained by the assessee from the AO under RTI Act. The Ld. AR submits that the notice in the case of the assessee u/s 148 has been issued by the Assessing Officer having no jurisdiction over the assessee and, therefore, the notice issued u/s 148 is invalid and void ab-initio. For this reliance is placed on the judgment of the Hon'ble Delhi High Court in the case of Dushyant Kumar Jain v. Deputy Commissioner of Income-Tax reported in [2015] 381 ITR 428 (Del), and further the judgment of the Co-ordinate Bench of the ITAT Delhi in the case of Saroj Sangwan v. Income-tax Officer reported in [2024] 207 ITD 165 (Delhi-Trib.). He prayed accordingly. 11. On the other hand, Ld. Sr. DR vehemently supported the orders of the lower authorities and submits that certain fresh information was received from Investigation Wing after comple....
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....lowed owing to a 'mistake', whereas, production and translation expenses were allowed without any verification. Even if, such an argument is to be accepted, the appropriate remedy in such a situation may lie under Section 263 of the Act. In CIT v. Usha International Ltd [2012] 25 taxmann.com 200/210 Taxman 188/348 ITR 485 (Delhi) [FB], the Court held as under: "......where an Assessing Officer incorrectly or erroneously applies law or comes to a wrong conclusion and income chargeable to tax has escaped assessment, resort to Section 263 of the Act is available and should be resorted to. But initiation of reassessment proceedings will be invalid on the ground of change of opinion." 28. Consequently, one of the essential ingredients for reopening the assessment beyond the period of four years has not been satisfied in the present case. Reassessment proceedings are therefore bad in law." 13. It is further observed that in the present case, the notice u/s 148 of the Act was issued by the Assessing Officer having no jurisdiction over the assessee. Further there was no order passed u/s 127 of Act transferring the jurisdiction in the case of assessee by the pri....
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....y the ACIT u/s 34(1) of the Act is without jurisdiction and hence is bad in law." 4. In the present memorandum of appeal no attempt has been made by the Revenue to aver whether in fact there was an order under Section 127 of the Act transferring the case to the ACIT, Circle 34(1). That being the position, the impugned order of the ITAT cannot be faulted. In view of the above conclusion, there is no occasion to examine the other questions urged by the Revenue in this appeal. 5. No substantial question of law arises. The appeal is dismissed. 15. The coordinate bench of Delhi Tribunal in the case of Sapna Rastogi Vs. ITO reported in 2024 (8) TMI 1517 (ITAT, Delhi) has held the reassessment order invalid when the wrong jurisdiction was assumed by issue of notice u/s 148 by the AO having no jurisdiction over the assessee. The relevant observations are as under: 5. We have given thoughtful consideration to the matter on record and the submissions. The assessee had filed a return of income on 07.07.2013 declaring the total income at Rs. 18,85,550/-. The assessee is an individual and, taking into consideration Instruction No. 01/2011 available at page 245 of t....