TaxTMI 
TaxTMI 
2026 (5) TMI 848
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....erred in confirming the addition made by the Ld. AO in initiating the reassessment proceeding under section 147 on the grounds that a. No reassessment can be made just to make an enquiry or verification b. Reassessment proceeding cannot be initiate merely on the information received from investigation wing. c. Reassessment proceeding cannot be initiated when the LD AO have reason to suspect and not reason to believe. 3. On the facts and circumstances of the case and in law, The Ld. CIT (A) erred in confirming the order passed under section 147 r.w.s. 144B of income tax Act which is passed against the principle of natural justice. 4. On the facts and circumstances of case and law the Ld AO erred in passing the assessment order under 147 r.w.s. 144B of income tax act without providing opportunity to rebut the material elide by him during the assessment proceedings which is against the principal of natural justice and hence the said order is liable to be quashed. 5. The Ld. AO erred in initiating Penalty Proceedings under section 270A are initiated for underreporting of income for the relevant asst. year." 3. Grounds No. 2-4, ra....
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....eld that this political party does not undertake any political activity and is an entity created with the sole purpose of facilitating bogus claims of deduction under section 80-GGC of the Act by soliciting donations, which are thereafter returned to the donors in cash or through electronic means in lieu of commission earned by the key persons as well as the intermediaries. The AO held that the negligible political presence registered by way of putting up candidates, who have lost their deposits in every election, renting of some stationary in the name of the party, posting of a few events which are merely photographic stunts, are solely intended to create a façade of political activity, so that the primary and sole business of providing accommodation entry in the form of bogus donations can continue unhindered. Accordingly, the AO disallowed the deduction of INR 25 lakh claim by the assessee under section 80-GGC of the Act on account of a donation made to the Kisan Party of India. 7. The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee. Being aggrieved, the assessee is in appeal before us. 8. During the hearing, the learned Authorised Re....
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....of Kisan Party several times saying that the party is working for the welfare and benefits of Kisan i.e. Agriculturists. of grass hopper. After facing all these issues there were marketing problems. The assessee could not face this problem as there was no help from the govt. and any such institution for Agriculturist, so the assessee had to stop agriculture and divert to do business. So to give moral support to a party which was working for the welfare of agriculturists the assessee decided to give donation to the Kisan Party of India. In earlier years the assessee was not aware of such party which is working only for the welfare of Agriculturist So there was no question of giving any donation. The assessee feels that if such parties are there the living standard of the agriculturists will be much better and will be an incentive to the young people to do agriculture and thereby add to the growth of Agriculture and add to India's GDP. The staff of Kisan Party of India, when found our approach positive gave us the bank details." 11. However, the AO disagreed with the submissions of the assessee, since the political party, i.e. Kisan Party of India, was one of the political par....
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....ase of agricultural produce, from various individuals / proprietary concerns. Such individuals/proprietary concerns are active agents in this scam and comprise the points at which cash is withdrawn. This is done due to the reason that the withdrawal of cash from the accounts of such individuals/proprietary concerns does not attract any attention or levy of any TDS on cash withdrawal as they are related to the agro-sector and they claim to purchase the produce directly from the farmers who are purportedly paid in cash. Another, major modus operandi that has been unearthed during the course of search/post search and assessment proceedings is the involvement of large number of APM licensed holders in and around the Ahmedabad district whose bank accounts were utilized in the above mentioned scam for withdrawing of cash. All these APM license holders were not undertaking any kind of trading of agro-based products; instead these were established for a sole purpose of withdrawal of large quantities of cash without deduction of any kind of TDS." 12. In support of its submission that the donation of INR 25 lakh was made to the Kisan Party of India, the assessee has placed on record, on p....
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.... philanthropic activity undertaken by the assessee, and which was approximately 40% of the net profit earned during the year. 15. Therefore, the aforesaid facts, coupled with the information available with the Revenue on the conduct of the Kisan Party of India as noted in the foregoing paragraphs, do not inspire confidence to accept the claim of the assessee that the donation of INR 25 lakh was genuine. 16. As regards the decisions of the Coordinate Bench of the Tribunal relied upon by the learned AR, we find that in Abhishek Jayketu Joshi (supra), the said decision was rendered on its own facts, which are distinguishable from the facts of the present case as noted in the foregoing paragraphs. Thus, we are of the considered view that this decision is not applicable to the present case. Further, the issue in Vitthaldas Nathubhai Shah v/s PCIT, reported in [2025] 215 ITD 77 (Ahm - Trib.), relied upon by the learned AR, pertains to the validity of proceedings initiated under section 263 of the Act. Accordingly, the Coordinate Bench at Ahmedabad, after recording the findings that the AO had made inquiries, called for supporting documents, verified the evidence, took a plausible v....