TaxTMI 
TaxTMI 
2026 (3) TMI 622
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....10.2016 declaring total loss of Rs. 71,684/-. The case of the assessee was reopened in terms of notice issued on 30.03.2021 u/s. 148 based on the information received from Investigation Wing that assessee has allegedly involved in rotation of huge amount of funds without any economic rational and during the year had made transactions with M/s Concise Exim Pvt. Ltd. of Rs. 39,27,750/-. Accordingly, satisfaction was recorded by the AO by alleging that transactions with M/s Concise Exim Pvt. Ltd. are accommodation entries which has escaped assessment. Thereafter the reassessment order was passed on 28.03.2022 u/s. 147/143(3) of the Act by making an addition of Rs. 1,99,12,000/- towards sale consideration received from M/s Khan Kinetic Treatment (P) Ltd (Rs. 65,50,000/-), M/s Youl Production (1) Pvt Ltd (Rs. 68,12,000/-) and M/s Thapar Infrastructure Pvt Ltd (Rs. 65,50,000/-) on the sale of shares of M/s Prominent Agency Pvt Ltd by treating the same as unexplained credit u/s. 68 of the Act. 5. Against the said order, appeal was filed before the Ld. CIT(A) who vide impugned order dated 29.03.2025, dismissed the appeal of the assessee. 6. Aggrieved by the said order, the assessee i....
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....d as accommodation entry, however, no addition whatsoever was made on this account in the reassessment order passed and the consideration received from the sale of shares was added as unexplained credits u/s. 68 of the Act. The reasons recorded before issue of notice u/s. 148 as available at pages 35 to 38 of the PB are reproduced herein below: 8. From the perusal of the reasons as reproduced above, it is observed that the reasons were recorded before reopening of the case of the assessee for the alleged transactions with M/s Concise Exim Pvt. Ltd. and based on this allegation, AO concluded that these transaction are rotation of money and, accordingly satisfaction was recorded of escapement of income of the transaction of Rs. 39,27,750/- carried out by the assessee company with M/s Concise Exim Pvt. Ltd. However, from the perusal of the reassessment order, we observed that in the assessment order, there is no whisper of the transactions with M/s Concise Exim Pvt. Ltd. nor any addition was made for the alleged transactions with M/s Concise Exim, which was made the sole basis for initiating reassessment proceedings in the case of assessee. In the reassessment order, addition is ma....
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..... [2011] 331 ITR 236 (Bombay) has also expressed the same view. Thus, by respectfully following the aforesaid judgments of the Hon'ble Jurisdictional High Court and of the hon'ble Bombay High Court wherein it is held that the reassessment order passed by making additions beyond the reasons recorded is without jurisdiction when the Assessing Officer has not made any addition on the reasons recorded for initiating the reassessment proceedings. In the instant case, as observed above, the additions were made for the issues not forming part of the reasons recoded and no addition was made for the issue raised in the reason for reopening the assessment thus, we hold that the AO has exceeded his jurisdiction and made the additions beyond the satisfaction of escapement of income. Therefore, the reassessment order passed u/s. 147/143(3) dt. 28.03.2022 is without jurisdiction and is quashed. Accordingly, Ground of appeal No. 3 of the assessee is allowed. 11. Since we have already allowed the legal ground of appeal No.3 taken by the assessee, the other grounds of appeal taken on merits of the additions are not adjudicated. 12. In the result, appeal of the assessee in ITA No. 2791/Del/202....
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....#1042;Е of the Act thereto. 3. That the Appellant craves to add, amend, alter, modify or delete any or all of the grounds of appeal before or at the time of hearing." 16. Heard both the parties and perused the materials available on record. The claim of the assessee is that during the course of reassessment proceedings, identity and creditworthiness of both the parties were established by filing their confirmations and the acknowledge of their return of income. The Ld. AR of the assessee further claims that in the case of M/s Navyuga Consultancy Pvt. Ltd. the assessment for Assessment Year 2017-18 was completed u/s. 143(3) wherein after considering the facts of the case, income declared was accepted and no adverse interference was drawn with respect to the amount given to assessee company. We observed that by filing the confirmations and copy of ITR, assessee has proved the identity of both the parties. The assessee has received of Rs. 12,00,000/- from M/s Navyuga Consultancy Pvt. Ltd, through banking channel and the copy of the bank statements of the said parties is also filed. From the perusal of the bank statements, it is observed that there was sufficient bala....
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....accordance with such method as may be prescribed; or (ii) as may be substantiated by the company to the satisfaction of the Assessing Officer, based on the value, on the date of issue of shares, of its assets, including intangible assets being goodwill, know-how, patents, copyrights, trademarks, licenses, franchises or my other business or commercial rights of similar nature, whichever is higher; 18. From the above, it is evident that the fair market value is to be taken either of the two "whichever is higher". In the instant case, the assessee has sold the shares at Rs. 300/- per share whereas according to the Net Asset Value (NAV) method, it comes to Rs. 38.21 per share. Since, the sale price is higher than the valuation as per NAV, in terms of Explanation to clause (viib) to sub-section (2) to section 56 of the Act no addition could be made. 19. Once it is admitted that the said sum of Rs. 1.50 crores was the consideration received by the assessee from the sale of shares owned by it, no addition could be made u/s. 68 of the Act by treating the same unexplained credit more particularly when the assessee has been able to establish the identity of the buyer. Since....
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....1), Mumbai vide letter F.No. DDIT(Inv.)/Unit- 1(1)/Information/SCEPL/2017-18 dated 16.03.2018 that during the F.Y. 2015-16, M/s Stance Consumer Electronices Pvt. Ltd. has entered into transaction amounting to Rs. 39,27,750/-with M/s Concise Exim Pvt. Ltd. The details of bank transactions between M/s Concise Exim Pvt. Ltd. and M/s Stance Consumer Electronics Pvt. Ltd. is as under :- IS.No. Date Amount Received in concise Account Amount |from Account transferred concise 1. 26.02.2016 39,27,750/- 2. 08.03.2016 39,27,750/- Amount Received in concise Account Amount |from Account transferred concise It appears that rotation of huge amount of funds have been taken place without any economic rationale M/s Stance Consumer Electronics Pvt. Ltd. is one of the company in network of companies which is engaged in rotation of huge amount of funds without any genuine economic rationale. 3. Analysis of information collected/received: From the above mentioned information it is clear that the assessee company has entered into transaction amounting to Rs. 39,27,750/- with M/s Concise Exim Pvt. Ltd. during the F.Y. 2015-16 relevant to A.Y. 2016-17. 4. En....