AIM FINCON PRIVATE LIMITED V. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 1(1)(1), AHMEDABAD

SCA/20439/2018

AI Insights

In this case, AIM Fincon Private Limited challenged a notice issued by the Assistant Commissioner of Income Tax, which sought to reopen the assessment for the year 2011-12. The notice was based on alleged transactions with M/s Jolly Sales Private Limited, which the petitioner contended were not made by them but by a different entity, Arihant Tradecom Private Limited. The court examined the identity of the entities involved and the transactions cited in the notice. After reviewing the submissions and evidence presented, the court concluded that the notice was issued in error and thus quashed it.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 750064 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 01-02-2021
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: MAUNA BHATT
• Assessee Lawyers: B S SOPARKAR
• Keywords: Impugned notice; Mistaken identity; Quash and set aside; Reopening of assessment; Writ application
• Section: 147; 148; 226

Judgement Text

"C/SCA/20439/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 20439 of 2018 ========================================================= = AIM FINCON PRIVATE LIMITED Versus ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 1(1)(1), AHMEDABAD ========================================================== Appearance: MR B S SOPARKAR(6851) for the Petitioner(s) No. 1 MRS MAUNA M BHATT(174) for the Respondent(s) No. 1 ========================================================== CORAM: HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MR. JUSTICE ILESH J. VORA Date : 01/02/2021 ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs: “(a) quash and set aside the impugned notice at Annexure 'A' to this petition; (b) pending the admission, hearing and final disposal of this petition, to stay implementation and operation of the notice at Annexure­A to this petition and stay further proceedings for assessment for A.Y. 2011­12.” 2. We need not delve much into the facts of this litigation as this writ application can be allowed on a short ground. 3. While issuing notice, a Coordinate Bench of this Court passed the following order on 24.12.2018 : “1. Mr.B.S.Soparkar, learned advocate for the petitioner has submitted that in this case the assessment year 2011­12 is sought to be Page 1 of 4 C/SCA/20439/2018 ORDER reopened by the impugned notice dated 16.4.2018 which is clearly beyond the period of four years from the end of the relevant assessment year. Referring to the reasons recorded, it was pointed out that the Assessing Officer has nowhere recorded that there is any failure on the part of the petitioner to disclose fully and truly all material facts. It was further pointed out that in the entire reasons recorded, there is nothing to indicate that the Assessing Officer is satisfied that any income chargeable to tax has escaped assessment. It was submitted that, in these circumstances, the reopening of assessment under Section 147 of the Act is without authority of law. 2. Having regard to the submissions advanced by learned advocate for the petitioner, issue Notice returnable on 11.2.2019. By way of ad­ interim relief, the respondent is restricted from proceeding further pursuant to the impugned notice. Direct service is permitted.” 4. Thereafter, when this bench heard the matter, the following order was passed on 06.01.2021 : “The principle argument of Mr. Soparkar, the learned senior counsel, is that the Arihant Tradecomm Private Limited and Arihant Tradecom are two different entities. According to Mr. Soparkar, the transaction which the department is referring to with M/s Jolly Sales Private Limited were never, at any point of time, made with the Arihant Tradecomm. Private Limited, I.e the writ applicant (hereinafter referred to as \"the Act\" for short). In this regard Mr. Soparkar, has been able to collect some information and has shared the same with Mr. Bhatt, the learned senior counsel, appearing for the Revenue. If it is the case of mistaken identity or something like that it can always be enquired and looked into. 2. Mr. Bhatt is requested to look into the information furnished today by Mr. Soparkar, and assist the Court on the next date of hearing. 3. Post this matter on 20.1.2021, on top of the Board.” 5. The last order passed by this bench dated Page 2 of 4 C/SCA/20439/2018 ORDER 20.01.2021 reads thus : “Pursuant to the order passed by this Court dated 06/01/2021, the department has called for the necessary information from Calcutta. The instructions are yet to be received. A request is made by Mr. Bhatt to post this matter after 10 days. Post this matter for final disposal on 01/02/2021 on top of the board.” 6. We had requested Mr. Manish Bhatt, the learned Sr. Counsel appearing for the Revenue to inquire whether the Arihant Tradecomm Private Limited and Arihant Tradecom are two different and distinct entities or not. We had requested Mr. Bhatt to inquire into this aspect in view of the principal argument canvassed on behalf of the assessee that the transaction with M/s.Jolly Sales Private Limited as being referred to by the department, for which the impugned notice under Section 148 of the Act came to be issued, was not with the assessee herein. 7. Mr. Manish Bhatt has received one communication in writing from the concerned department. The communication in writing received by Mr. Bhatt is ordered to be taken on record. The same reads as under: From:”ahmedabad.addlcit.1” Date : Jan 27, 2021 5:09:40 PM Subject : Fwd:Re:FWD “Re:SCA No.20439 of 2018, AIM Fincon Pvt. Ltd. vs. ACIT, Circle­1(1)(1), Ahmedabad To: “ahmedabad.pcit1” Sir, Page 3 of 4 C/SCA/20439/2018 ORDER Please refer to the trail mail of the AO. As per the mail of AO, bank account No.No.020606400012282 with Dhanlaxmi Bank Ltd, Kolkata pertains to Pravin Kr Sharma, (Arihant Tradecom), A/c. No.020606400012282, PAN : BYCPS1846R­ a sole proprietor. The said bank account does not pertain to M/s. AIM Fincon Pvt. Ltd. (earlier known as M/s. Arihant Tradecomm Pvt. Ltd.) Submitted for kind perusal and necessary action please. Yours faithfully Addl. CIT Range 1(1)Ahmedabad.” 8. It is now confirmed that the assessee had no transaction with M/s. Jolly Sales Private Limited and inadvertently, the impugned notice came to be issued to the assessee herein. 9. In view of the aforesaid, this writ application is allowed. The impugned notice issued to the assessee under Section 148 of the Income Tax Act for the A.Y. 2011­12 is hereby quashed and set aside. (J. B. PARDIWALA, J) (ILESH J. VORA,J) SUCHIT Page 4 of 4 "