TaxTMI 
TaxTMI 
2026 (6) TMI 675
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..... 271(1)(c) and 270A Income Tax Act [in short "the Act"], 1961 for the assessment years 2013-2014, 2014-2015 and 2017-2018, respectively. 2. The assessee is a private limited company carrying on business of real estate. There was a search and seizure in the case of Kapil Agro Farms and Developers Private Limited on 07.04.2017. Pursuant to the said search and seizure action the Assessing Officer take-up the case of the assessee for scrutiny and passed the assessment order whereby the additions were made on account of disallowance of lay out development expenditure. Against the assessment order the assessee carried the matter in appeal to this Tribunal and thereafter before the Hon'ble jurisdictional High Court. In the meantime, the Assess....
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....quantum appeal, the penalty would not survive. However, she has relied upon the Orders of the authorities below. 5. We have considered the rival submissions as well as relevant material on record. Initially this Tribunal has decided the appeals of the assessee in ITA.Nos.673 to 676/Hyd./2020 vide composite Order dated 21.03.2022 in Para nos.29 to 33 as under: "29. Next comes M/s. Kousalya Agro Farms and Developers Private Limited's four appeals ITA Nos.673 to 676/Hyd/2020 involving A.Ys.2012-13 to 2014-15 and 2017-18; respectively. 30. We find at the outset that its former twin appeals involve section 143(3) assessments framed on 14.03.2015 and 24.03.2016; respectively followed by the Assessing Officer's section....
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....ar 2014-2015 and 2017-2018 the Tribunal rejected the ground of validity of the reopening and remanded the matter to the record of the Assessing Officer for fresh adjudication. Against the said finding of the Tribunal, the assessee filed appeals before the Hon'ble jurisdictional High Court and the Hon'ble High Court vide its Judgment dated 02.02.2023 set-aside the Order of this Tribunal and remanded back the matter with a direction that the Tribunal to dispose of the appeals on merits as well as the validity of re-assessment proceedings. Thereafter, the appeals for the assessment years 2014-2015 and 2017-2018 were decided by this Tribunal vide Order dated 04.09.2024 in Para nos.11, 12 and 22 as under: "11. In the present case, the o....
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....ns that the assessee has failed to disclose relevant facts for assessment, the assessment cannot be reopened beyond 4 years when original assessment has been completed u/s 143(3) of the Act. This principle has been supported by the decision of Hon'ble Supreme Court in the case of CIT Vs. Foramer France (2003) 264 ITR 566 (SC). Therefore, in our considered opinion, reopening of the assessment under Section 147 of the Act on the basis of the reasons recorded by the Assessing Officer, which is available in the assessment order, is a clear case of non-application of mind by the Assessing Officer, before initiating the proceedings under Section 147 of the Act. Therefore, we are of the considered view that the reopening of the assessment and ....
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....s for the purpose of business. The Id. CIT(A) went on a different footing and computed disallowance of interest for diversion of interest-bearing funds for non-business purpose. We find that the basic business of the assessee is real estate development, and in that process, the assessee collected advances from customers for sale of flats. As per the agreement with the customers, the assessee has paid interest in case of delay in delivery of flats. The assessee had also proved that the funds received from the customers in the form of advances have been utilized for the purpose of business of the assessee. In fact, it is not a case of the AO that the assessee had diverted funds for non-business purposes. Assuming for a moment that loans and a....