2026 (2) TMI 1470

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....Year is 2017-18. 2. The assessee has raised legal grounds. One of the legal ground raised is Ground No.4.1, which reads as under:- "4.1 For that Ld.CIT(A) failed to note that reopening cannot survive when the reason for reopening ceased to survive, in the light of the fact that no addition was made in respect of the reason for reopening." 3. The Ld.AR submitted that if the above legal ground is adjudicated, the other grounds need not be adjudicated and may be left open. The Ld.AR submitted that reassessment was initiated on the pretext of assessing income escaping assessment, which was not assessed in the assessment order completed on 31.01.2025 passed u/s.147 r.w.s 144 r.w.s. 144B of the Act. It was stated that notice u/s.14....

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....objection of the assessee against the reopening of assessment. In the order passed u/s.148A(d) of the Act on 20.03.2024, the reason stated for initiation of reopening the assessment was to bring to tax the cash withdrawal of Rs.1,70,29,000/- and cash deposits of Rs.1,15,000/-. The assessment was completed u/s.147 r.w.s.144 r.w.s 144B of the Act vide order dated 31.01.2025. In the said assessment order, the AO has made two additions namely estimation of net profit at 5% amounting to Rs.8,27,540/- and unaccounted purchase of milk from M/s. Jayaa Milk Products of Rs.62,11,350/-. As regarding the first addition of Rs.8,27,540/-, the AO calculated the net profit ratio declared by the assessee at 0.28% when assessee had declared net profit rate o....

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....urisdictional High Court in the following cases had held that when the reasons for reopening did not form part of additions in the reassessment order, the AO is precluded from making other additions. i. PVP Ventures Ltd., vs. ACIT, 65 taxmann.com 221 ii. Martech Peripherals (P) Ltd., vs. DCIT, 81 taxmann.com 130 iii. Tractors & Farm Equipment Ltd., vs. ACIT, 102 taxmann.com 130 iv. Anand Cine Services (P) Ltd., vs. ACIT, 169 taxmann.com 236 8. The relevant finding of the Hon'ble Jurisdictional High Court in the case of PVP Ventures Ltd., (supra), read as follows:- "30. As we have indicated earlier, cases where the reopening is found to be within the parameters of the prescription contained in ....