ITO, WARD- 2(4), NEW DELHI V. ANU BUILDWELL PVT. LTD., NEW DELHI

ITA 5999/DEL/2017

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7908 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-08-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 22-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Difference of opinion; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 48; 147; 68; 148; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI A BEN CH, NEW DELH I BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER (THROUGH VIDEO CONFERENCING) ITA NO.5999/DEL/2017 [A.Y 2012-13] INCOME TAX OFFICER VS. ANU BUILDWELL LTD. WARD-2 (4) 18, CHANDER LOK NEW DELHI ENCLAVE, PITAM PURA NEW DELHI APPELLANT BY : MS. RAKHI VIMAL, SR . DR. RESPONDENT BY : SH. ASHWANI KUMAR, CA SH. ADITYA KUMAR, CA SH. RAHUL CHAURASIA, CA SH. BHAVNESH JINDAL, CA MS. UDITI JAIN, CA DATE OF HEARING : 20.08.2020 DATE OF PRONOUNCEMENT : .08.2020 ORDER PER N. K. BILLAIYA , AM : 1. THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE CIT(A)-1, NEW DELHI DATED 18.07.2017 PERTAINING TO A.Y. 2012-13. 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE REVEN UE IS THAT THE CIT(A) ERRED IN QUASHING THE NOTICE U/S. 148 OF THE ACT BY HOLDING THERE WAS CHANGE OF OPINION. 3. BRIEFLY STATED THAT FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 29.10.2012. THE RETURN WAS SELE CTED FOR SCRUTINY ASSESSMENT UNDER CASS AND ACCORDINGLY STATUTORY NOT ICES WERE ISSUED AND SERVED UPON THE ASSESSEE. THE ASSESSMENT WAS COMPL ETED U/S. 143 (3) OF THE ACT. VIDE ORDER DATED 30.01.2015 AND THE INCOM E WAS ASSESSED AT RS. 607215/-. 4. ON THE BASIS OF SOME INFORMATION RECEIVED FROM OFFI CE OF THE ADDITIONAL CIT RANGE-4, LUDHIANA DATED 14.05.2015. THE COMPLETED ASSESSMENT WAS REOPENED AS THE AO HAD REASON TO BEL IEVE THAT INCOME HAS ESCAPED ASSESSMENT. ACCORDINGLY NOTICE U/S. 148 WAS ISSUED AND SERVED UPON THE ASSESSEE. 5. IT WOULD BE PERTINENT TO REFER TO THE INFORMATION R ECEIVED WHICH TRIGGERED THE REASSESSMENT PROCEEDINGS. 6. ON THE BASIS OF THE AFORESAID REASONS THE AO STA RTED THE REASSESSMENT PROCEEDINGS AND THE INFORMATION GATHER ED BY THE ADDL. CIT LUDHIANA WERE USED AGAINST THE ASSESSEE AND THE AO CAME TO THE CONCLUSION THAT THE CREDITS OF RS. 1.75 CRORES AND 2.40 CRORES ARE DIRECTLY HIT BY SECTION 68 OF THE ACT SINCE THE ASSESSEE FAI LED TO PROVE THE GENUINENESS OF THE TRANSACTIONS AND THE CREDIT WORT HINESS OF THE PERSON WHO HAS GIVEN THE CREDIT TO THE ASSESSEE. THE COMPA NY HAD FAILED TO DISCHARGE ITS ONUS AND ACCORDINGLY THE AO MADE THE ADDITION OF RS.4.15 CRORES U/S. 68 OF THE ACT. 7. ASSESSEE CHALLENGED THE ASSESSMENT BEFORE THE CI T(A) QUESTIONING THE VALIDITY OF THE NOTICE U/S. 148 OF THE ACT. IT WAS VEHEMENTLY CONTENDED THAT REASSESSMENT PROCEEDINGS INITIATED B Y THE AO IS NOTHING BUT CHANGE OF OPINION. AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS AND AFTER DISCUSSING CERTAIN JUDICIAL DECISIONS THE CIT(A) HAS HELD AS UNDER :- IN THE INSTANT CASE ASSESSMENT WAS COMPLETED U/S 1 43(3) OF THE ACT VIDE ORDER DATED 30.01.2014. THE NOTICE U/S 148 WAS ISSUED ON 18.06. 2015. THE AO WAS REQUIRED TO DEMONSTRATE THAT APPELLANT HAS FAILED TO MAKE A RET URN U/S 139 OR IN RESPONSE TO THE NOTICE ISSUED UNDER SUB-SECTION 1 OF SECTION 142 OF SECTION 148 OR TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR ITS ASSESSME NT FOR THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER HAS EXAMINED THE COMPLETE ACCOUNT S OF APPELLANT DURING THE ORIGINAL ASSESSMENT PROCEEDINGS. THE COMPLETE DETAILS OF INV ESTMENT IN SHARES AND SHARE APPLICATION MONEY RECEIVED AND THEIR CONFIRMATION W ERE FILED BEFORE THE AO DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS AND SUCH RECEIPT OF THE SHARE APPLICATION MONEY WAS EXAMINED BY THE AO AS DISCUSSED ABOVE. TH E AO AFTER BEING SATISFIED DID NOT MAKE ANY ADDITION ON THE ISSUE OF SHARE APPLICATION MONEY AND INVESTMENT IN SHARES. ALL THESE FACTS GOES TO PROVE THAT NOTICE ISSUED U/S 14 8 OF THE ACT IS ONLY BASED ON CHANGE OF OPINION ON THE SAME SET OF FACTS WHICH IS NOT PERMI SSIBLE IN THE LAW AS HELD BY HONBLE SUPREME COURT AND HONBLE DELHI HIGH COURT IN THE J UDGMENTS DISCUSSED ABOVE. CONSEQUENTLY, THE PROCEEDINGS INITIATED U/S 148 IS NOT VALID IN THE EYES OF LAW AND THE ISSUE OF NOTICE U/S 148 IS QUASHED AND THE GROUND N O. 2 IS ALLOWED. 8. SINCE THE FIRST APPELLATE AUTHORITY HAS QUASHED THE NOTICE ISSUED U/S. 148. HE DID NOT FIND IT NECESSARY TO ADJUDICA TE THE APPEAL ON MERITS. 9. AGGRIEVED BY THIS THE REVENUE IS BEFORE US. 10. THE DR STRONGLY SUPPORTED THE FINDINGS OF THE AO. IT IS THE SAY OF THE DR THAT THE INFORMATION RECEIVED FROM ADDL. CIT , LUDHIANA WAS SUFFICIENT ENOUGH FOR REOPENING THE ASSESSMENT AS T HE INFORMATION WAS VERY SPECIFIC AND DEFINITELY A NEW TANGIBLE MATERIA L EVIDENCE FOR THE ISSUE OF NOTICE U/S. 148 OF THE ACT. 11. THE DR FURTHER STATED THAT THE ISSUES RAISED IN THE NOTICE FOR REOPENING THE ASSESSMENT WERE NEVER EXAMINED BY THE AO IN THE ORIGINAL ASSESSMENT PROCEEDINGS SINCE THE INFORMATION WAS RE CEIVED AFTER THE COMPLETION OF THE ASSESSMENT AND, THEREFORE, HIS NE W MATERIAL EVIDENCE WAS SUFFICIENT TO INITIATE REASSESSMENT PROCEEDINGS . IN HER WRITTEN SUBMISSION THE DR RELIED UPON THE SEVERAL JUDICIAL DECISIONS TO SUPPORT THE CASE OF THE REVENUE. 12. PER CONTRA THE COUNSEL FOR THE ASSESSEE SUPPORTING THE ORDER OF THE CIT(A) STATED THAT IN THE ORIGINAL ASSESSMENT PROCE EDINGS SPECIFIC QUERIES WERE RAISED BY THE AO AND SPECIFIC REPLIES WERE FIL ED. IT IS THE SAY OF THE COUNSEL THAT WHATEVER IS MENTIONED IN THE INFORMATI ON HAS BEEN PART OF THE SCRUTINY ASSESSMENT PROCEEDINGS AND AFTER CONSI DERING THE SAME THE AO HAS FRAMED THE ASSESSMENT ORDER U/S. 143 (3) OF THE ACT AND, THEREFORE, THIS IS NOTHING BUT CHANGE OF OPINION. 13. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORD ERS OF THE AUTHORITIES BELOW. THE ENTIRE QUARREL IS IN RESPEC T OF THE LOAN GIVEN BY THE ASSESSEE TO ONE M/S. A.P. REFINERY PRIVATE LIMI TED, LUDHIANA AND THE QUARREL ALSO RELATES TO THE SHARES ALLOTTED BY M/S. A.P. REFINERY PRIVATE LIMITED TO THE ASSESSEE AT A PREMIUM TOTALLING TO R S.1.75 CRORES. 14. WE FIND THAT DURING THE COURSE OF THE ORIGINAL ASSE SSMENT PROCEEDINGS VIDE REPLY DATE 26.08.2014 VIDE POINT N O.4 THE ASSESSEE HAS MENTIONED DURING THE YEAR UNDER CONSIDERATION THE COMPANY HAS RAISED SOME FUND ON ACCOUNT OF UNSECURED LOANS. THE REQUI SITE DETAIL IN RESPECT OF THE PARTIES IS ENCLOSED. WE ARE ALSO ENCLOSING THE CONFIRMATION, BANK STATEMENT AND COPY OF INCOME TAX RETURN OF THE PART Y CONCERNED. FURTHER THE ASSESSEE HAS ALSO FURNISHED THE DETAILS OF SHARE APPLICATION MONEY RECEIVED WHICH IS AS UNDER :- 15. WE FURTHER FIND THAT VIDE REPLY DATED 05.01.2015 TH E ASSESSEE HAS EXPLAINED THE JUSTIFICATION OF THE SHARE PREMIUM RE CEIVED DURING THE YEAR WHICH IS AS UNDER :- 16. HOW BORROWED FUNDS WERE UTILISED FOR THE PURPOSE OF INVESTMENT IN SHARES AND THE SAME READ AS UNDER :- 17. IN THE LIGHT OF THE AFOREMENTIONED DISCUSSION L ET US NOW SEE THE CONCLUDING PARAGRAPHS OF THE REASONS FOR REOPENING THE ASSESSMENT THIS 9. SUCH TRUE NATURE OF THE TRANSACTION UNDERTAKEN B Y THE ASSESSEE COMPANY HAS COME TO LIGHT ONLY AFTER THE DETAILED I NVESTIGATION CARRIED BY THE ADDL. COMMISSIONER OF INCOME TAX, RANGE-IV, LUDHIANA. THIS TANTAMOUNT TO FRESH INFORMATION. THE TRANSACTION IN VOLVING RS.1,75,00,000/-, MENTIONED ABOVE, CONSTITUTES FRES H INFORMATION IN RESPECT OF THE ASSESSEE WHO HAS PROVIDE BOGUS ACCOM MODATION ENTRIES TO THE ABOVE MENTIONED GROUP COULD NOT EXPLAIN THE SOURCE. IT REPRESENTS THE UNDISCLOSED INCOME/INCOME FROM OTHER SOURCES OF THE ASSESSEE COMPANY, WHICH HAS NOT BEEN OFFERED TO TAX BY THE ASSESSEE IN ITS RETURN FILED. 10. HAVING PERUSED AND CONSIDERED THE INFORMATION R ECEIVED FROM THE ADDL. COMMISSIONER OF INCOME TAX, RANGE-1V, LUDHIAN A AND ON THE BASIS OF THIS NEW INFORMATION, I HAVE REASON TO BELIEVE T HAT THE INCOME OF RS. 1,75,00,000/- HAS ESCAPED ASSESSMENT AS DEFINED BY SEC. 147 OF THE IT ACT. IN VIEW OF THE ABOVE, I AM SATISFIED THAT THIS IS A FIT CASE FOR ISSUANCE OF NOTICE U/S 148 OF THE IT ACT. SUBMITTED FOR PERUSAL AND NECESSARY SANCTION, AS PER SECTION 151(1) FOR ISSUANCE OF NOT ICE U/S 148 OF THE IT ACT. 18. AS CAN BE SEEN FROM THE ABOVE THE AO SEEKS TO R EOPEN THE COMPLETED ASSESSMENT ON THE ISSUES WHICH WERE THORO UGHLY EXAMINED DURING THE COURSE OF THE ORIGINAL ASSESSMENT PROCEE DINGS. 19. MERELY BECAUSE IN THE ASSESSMENT PROCEEDINGS OF M/S. A.P. REFINERY PRIVATE LIMITED THAT AO MADE SOME ADVERSE REMARKS A GAINST THAT ASSESSEE WOULD NOT ALLOW THE AO TO INVOKE JURISDICTION U/S 1 48 OF THE ACT AND REOPEN THE COMPLETED ASSESSMENT ON THE VERY SAME FA CTS AND ISSUES WHICH WERE THOROUGHLY EXAMINED BY THE AO IN THE ORI GINAL ASSESSMENT PROCEEDINGS. 20. THE FACTS DISCUSSED HEREIN ABOVE SPEAKS FOR THE MSELVES AND NEED NO REFERENCE TO ANY JUDICIAL DECISIONS RELIED UPON BY BOTH THE SIDES ON THE STRENGTH OF THE FACTS DISCUSSED ELSEWHERE. WE DO N OT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE CIT(A). 21. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25.08.2020. SD/- SD/- [SUCHITRA KAMBLE] [ N. K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 25.08.2020 *NEHA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR ITAT, NEW DELHI DATE OF DICTATION 21.08.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 25.08.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 25.08.2020 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS 25.08.2020 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 25.08.2020 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS 25.08.2020 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT 25.08.2020 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 25.0 8.2020 DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER