TaxTMI 
TaxTMI 
2026 (6) TMI 1280
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....in the business of transportation and has a business relationship with M/s. DCW Ltd., wherein, it hires trucks and offers it for transportation against freight amount agreed between the parties. The petitioner filed the return of income for A.Y. 2021-22 on 14.12.2021, declaring net total income of Rs.38,51,910/-. The return of income was processed under Section 143(1) of the Act. 2.2. It appears that, a search under the provision of Section 132 of the Act was undertaken against the group of M/s. DCW Ltd. on 18.11.2023. After the incriminating materials were collected during the search at M/s. DCW Ltd., the respondent issued a notice under Section 148A(1) of the Act on 31.03.2025 for reopening the assessment on the allegations referred therein and it was alleged that the income had escaped assessment. 2.3. The petitioner submitted his reply to the notice and clarified the income, citing total bills of Rs. 6,68,95,812/- towards the freight and transportation income. 2.4. It is the case of the Revenue that the petitioner raised inflated bills for transportation expenses to the tune of Rs. 32,71,205/-, and this income has escaped assessment. 2.5. The petitioner accordingly ....
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....s amount received from M/s. DCW Ltd. was returned in cash to Shri Ajay Gupta, Senior Sales Manager of M/s. DCW Ltd., and this admission and the statement recorded during the search, will not fall within the expression of "incriminating material" and as the reopening is permissible under the provision of Section 148(1) of the Act and accordingly, the show cause notice was issued to the petitioner - assessee. 4.3. It is submitted that, the amended provision as per the Finance (No. 2) Act of 2024 would accordingly apply in the case of the petitioner, which permits the Revenue to issue notice under Section 148 of the Act, which was issued on 23.05.2025. It is contended that, this is not the case about M/s. DCW Ltd. claiming inflated expenditure, but it is about the petitioner - assessee receiving inflated payments, withdrawing such amounts in cash and returning unaccounted cash to M/s. DCW officials, which constitutes undisclosed transactions and unexplained expenditure at the hands of the assessee. It is thus submitted that, the modus operandi was that the assessee showed its transportation receipts to the tune of Rs. 3,59,26,191.70/-, which is contrary to the evidence and such amo....
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....sh by giving bogus commission by issuing notice under Section 148A(1) of the Act on 31.03.2025. The petitioner accordingly submitted his reply on 15.04.2025, however, the objections were disposed of, by order dated 19.05.2025 passed under Section 148A(3) of the Act and accordingly a notice under Section 148(3) of the Act was issued on 23.05.2025. 7. A reading of the order under Section 148A(3) of the Act, reflects that the Assessing Officer has categorically recorded the details of the incriminating materials found during the search. It is recorded that the "The hand-written sheets and other incriminating documents found and seized during search revealed the modus operandi of cash receipts and cash payments. It was found that the assessee has taken cash loans from various parties and distributors as per the requirements. The cash loans were adjusted against the non-genuine expenses incurred towards bogus commission / rebate over the period. In addition to the above, evidences of unaccounted scrap sale have also been found which were never reported by the company." 8. It appears that, during the course of search proceedings, a statement of the petitioner was also recorded, whi....
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.... under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if a notice under section 148 or section 153A or section 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section or section 153A or section 153C, as the case may be, as they stood immediately before the commencement of the Finance Act, 2021: Provided further that the provisions of this sub-section shall not apply in a case, where a notice under Section 153-A, or Section 153-C read with Section 153-A, is required to be issued in relation to a search initiated under Section 132 or books of account, other documents or any assets requisitioned under Section 132-A, on or before the 31st day of March, 2021." 11. In the present case, the provision of Section 149(1)(a) of the Act, which prescribes a time limit of three years, will get attracted, as the alleged escapement of income is below the amount of Rs.50 lakh, which finds place in the provision of Section 149(1)(b) of the Act. The relevant assessment year in the present case is A....