TaxTMI 
TaxTMI 
2026 (3) TMI 548
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....ned CIT(A) failed to appreciate that the assessment order, insofar as it is against the appellant, is opposed to the law, equity, the weight of evidence, probabilities, and the facts and circumstances of the case. 3. The learned CIT(A) erred in upholding the issuance of notice under section 148 of the Income Tax Act, 1961, despite the fact that the AO did not have any tangible material or information on the date of issuance of such notice. 4. The learned CIT(A) erred in confirming the reopening of the assessment for the Assessment Year 2018-19 under section 148 without the issuance of a mandatory notice under section 148A of the Income Tax Act, 1961. 5. The learned CIT(A) erred in not considering that the impugned order was passed without specifying the section under which it was passed, making it legally unsustainable. 6. The learned CIT(A) erred in confirming the following additions without properly appreciating the facts and evidence on record: a) Addition of Rs. 90,50,000/- under section 37 of the Income Tax Act, 1961, without any valid basis. b) Addition of Rs. 21,08,825/- under section 68 of the Income Tax Act, 1961, despi....
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....onsidering the details furnished through ITBA portal and also through personal hearings, concluded the assessment proceedings on a total assessed income of Rs. 3,32,19,253/- by making total addition of Rs. 2,48,73,893/- as summarized below:- Para No. Particulars Addition u/s Addition amount Penalty initiated u/s 7 Disallowance u/s 37 of IT Act 28 to 44D 90,50,000 270A(9)(c) 8 Unexplained credits 68 21,08,825 271AAC of the Act 9 Unexplained credits 68 96,90,000 271AAC of the Act 10 Business income 28 to 44D 40,25,068 270A(9)(c) 2,48,73,893/- The Assessment was concluded as below: Income as per ROI dated 20.4.2022 83,45,360/- Additions as per table above 2,48,73,893/- Assessed income 3,32,19,253/- 4. Aggrieved by the assessment completed u/s 147 of the Act on 30.3.2023, the assessee preferred an appeal before the ld. CIT(A). The ld. CIT(A) partly allowed the appeal of the assessee by holding that the AO had not pointed out any discrepancies in the audited books of account to enhance the net profit to 10% of the turnover. Further, the books of a....
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....ld. JCIT(DR) vehemently relied on the orders of the authorities below and vehemently submitted that the case was reopened on the basis of search action u/s 132 of the Act conducted at the premises of M/s. Shri Chowdeshwari Enterprises as well as at the assessee's residence on 2.12.2021. During the course of search, the assessee Shri Anil Kumarji admitted that he has taken the services of M/s. Arjun Shouhardha Pattina Sahakara Niyamita and Mr. Sekhar V.R. such as cash to RTGS transfers and RTGS to cash. The assessee vide statement recorded under oath stated that he used to pay a commission to Mr. Sekhar V.R. for availing such services. The assessee Mr. Anil Kumar is a member of Arjun Souhardha since the financial year 2017-18 and has made huge transactions with the society over the period. The transactions done with Arjun Souhardha is not reported in the ITR and financials filed by the assessee. Since search was initiated u/s 132 of the Act in the case of assessee, in accordance with Explanation 2 to section 148, there was information deemed to have escaped assessment. As per the Proviso to Section 148A, the provisions of Section 148A are not applicable in case where a search is ini....
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.... Thus, as can be seen above, in opening line of the assessment order, the AO himself recorded that the assessee had filed his return of income for the Assessment year 2018-19 on 16/07/2018. The very basis of the sanction/approval u/s 151 of the Act is contrary to the facts recorded in the assessment order. We are of the considered opinion that the ld. PCIT(Central)'s sanction/approval is purely based on wrong assumption of facts. Further, on going through the approval u/s 151 of the Act dated 24/03/2022 we also take note of the fact that the ld. PCIT(Central) had granted the approval on the ground that the assessee is a non-filer and accordingly the ld. PCIT(Central) was satisfied that it is a fit case for reopening u/s 147 of the Act which in our opinion is completely baseless. 8.3 We are of the considered opinion that for issue of notice u/s 148 of the Act by the AO, sanction is required as provided u/s 151 of the Act. The necessity for such sanction was considered by the legislature so as to protect the taxpayers from the arbitrary and reckless reopening of the assessment proceedings. The sanction u/s 151 was considered equivalent to approval by the Higher Authority of the ac....
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....able and it will be taxable whether the assessee has filed the return of income or not, and whether such alleged escaped income would be taxable in the concerned assessment year. Such requirement is envisaged in view of the word "satisfied" used in section 151 of the Act. The requirement is not mere mechanical approval but an objective satisfaction which warrant application of mind by the superior authority. Exercising power u/s 151 of the Act in a casual and routine or mechanical manner while granting sanction would show non-application of mind and such sanction cannot be upheld. The note about satisfaction while granting sanction must show which material; information; documents and which other aspects have been gone through and examined by the sanctioning authority. 8.5 The Hon'ble High Court of Gujarat in the case of Sagar Enterprises v. Assistant Commissioner of Income-tax reported in (Guj-HC) :(2002) 257 ITR 335 has held as under- "4. On going through the entire reasons recorded, it can be seen that in the penultimate paragraph, the respondent has further recorded as under : "Further, the assessee was required to file the return of the income for assessment year 19....
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....-1, KOLAR TRANSMISSION OF ELECTRONIC INFORMATION AND THE PAN ASNPA4817C Form No. which has been ITR-3 electronically transmitted Individual Status Aadhaar Number/Enrollment ID DATE PERSONAL XXXX XXXX 70 Original or Revised ORIGINAL E-filing Acknowledgement Number 788982811160718 Date(DD/MM/YYYY) 16-07-2018 COMPUTATION OF INCOME TAX THEREON 1 Gross total income 8525360 2 Deductions under Chapter-VI-A 2 180000 3 Total Income 8345360 3a Current Year loss, if any 0 4 Net tax payable 2624151 5 Interest and Fee Payable 130344 6 Total tax, interest and Fee payable 6 2754495 7 Taxes Paid Advance Tax 7a COMPUTATION OF INCOME TAX THEREON b TDS 1183822 TCS d Self Assessment Tax 7d 1570673 Total Taxes Paid (7a+7b+7c +7d) 2754495 Tax Payable (6-7e) 8 Refund (7e-6) Agriculture 10 Exempt Income 10 Others in the capacity of ASSESSEE This return has been digitally signed by GOPAL ANIL KUMAR #1 BENGALURU from IP Address 122.172 115.13 on 16-07-2018 ASNPA4817C having PAN 1400640889CN=(n)Code Solutions CA 2014.2 5:4 51=#13133330312620474c464320....