TaxTMI 
TaxTMI 
2025 (3) TMI 1684
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....543/-. The return was processed under Section 143(1) of the Act. Subsequently, information was received from the Investigation Wing, Mumbai, regarding a search and survey action conducted on 03/10/2013 in the case of the Bhanwarlal Jain Group. The investigation led to the collection of substantial evidence and findings, conclusively establishing that the said group, through a network of benami concerns operated by it, was engaged in providing accommodation entries in the form of bogus purchases, unsecured loans, and advances to various beneficiaries. Pursuant to necessary inquiries and verification of the assessee's records for the relevant assessment year, it was found that the assessee had received accommodation bills from the following entities: Sr. No. Name of the Hawala Parties Bill Amount (Rs. ) 1 Kothari & Co. 1,33,78,106/- 2 Surya Diam 1,20,42,926/- Total 2,54,21,032/- In view of the above findings, the case was reopened under Section 147 of the Act, with prior approval from the Ld. Principal Commissioner of Income Tax-19 (PCIT), Mumbai, and a notice under Section 148 was issued to the assessee on 15/03/2019. In response, the as....
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....hich is reproduced as below:- "Subject: Reg: REASONS FOR RE-OPENING ASSESSMENT FOR AY 2012-13 IN YOUR CASE 1. In this case, the assessee has not filed its return of income for A.Y. 2012-13. 2. Information was received that a Search & seizure action has been carried out by the DGIT (Inv.), Mumbai in the case of Shri Bhanwarlal Jain and their Group Concerns. During the course of search/survey action, it was revealed that these group concerns were merely providing accommodation entries through various benami concerns operated and managed by them. It was also found that these concerns are indulged into fraudulent transactions of issuing accommodation/hawala entries which purportedly shows transaction of purchase and sale of materials and bogus unsecured loans and advances. 3. On the basis of information received and also on perusal of the records of the assessee, it is noticed that the above mentioned assessee has availed accommodation entries from the said Group Concerns during the year under consideration. 4. Details of the hawala entities from whom the assessee has obtained accommodation entries for the year under consideration are given ....
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....assessee. The Ld.AR invited our attention in APB page 61 where the assessee annexed the copy of ITR which was filed to department on 29/09/2012. The Ld.AR challenged the ground related to wrong observation of the Ld. AO related issuance notice under section 147 for status on filing of return. It is argued that wrong observation during recording of reason is vitiated the entire proceeding U/s 148 of the Act. 4. The Ld.AR respectfully relied on the order of Hon'ble Gujarat High Court in the case of Sagar Enterprises vs ACIT (2002) 124 Taxman 641 (Guj). The relevant observations in paras 4 to 6 are reproduced below:- "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 1991-92 which the assessee has failed. Moreover, it was the duty of the assessee to declare this transaction and to file the return of income for assessment year 1991-92. The assessee has failed on both these counts. Therefore, the escapement of assessment of income is solely attributable to the assessee." There....
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....xed in the assessment year 1991-92 or the assessment year 1992-93. In such a situation, it is not possible to agree with the stand of the revenue that any income could be stated to have escaped the assessment for the assessment year 1991-92 as a consequence of any failure or omission on the part of the assessee. The petition is, therefore, allowed. The impugned notice dated 3-10-1997 (Annexure R) is quashed and set aside. Rule is made absolute with no order as to costs." 5. The Ld.AR respectfully, relied on the order of Hon'ble Gujarat High Court in the case of Vijay Harishchandra Patel vs. ITO (2018) 400 ITR 167 (Guj). The observations of the Hon'ble Court is reproduced as below:- "10. As is apparent on a plain reading of the reasons recorded, the very basis for reopening the assessment is that the petitioner had not filed any return of income disclosing such sale of the immovable property valued at Rs. 40,00,000. The record of the case shows that earlier, pursuant to a notice under s. 148 of the Act, the petitioner had, in fact, filed return of income disclosing the sale of such immovable property, and the AO after duly applying his mind to the issue had acce....