2024 (5) TMI 755 - AT - Income Tax

Validity of reopening/reassessment - AO had recorded his reasons to believe that the taxpayer s corresponding taxable income arising from sale of immovable property had escaped assessment - HELD THAT - Revenue could hardly dispute that the NFAC s lower appellate discussion has reproduced the said reopening reasons making it clear that the alleged income required detailed verification as well as in-depth enquiry is needed for which the case is reopened Faced with this situation, the undersigned is of the considered opinion in light of Manzil Dinesh Kumar Shah, 2018 (5) TMI 1176 - GUJARAT HIGH COURT and Maheswari Devi 2022 (11) TMI 1117 - JHARKHAND HIGH COURT that such a course of action is not sustainable in sec. 148/147 proceedings. Thus quash the impugned reopening/re-assessment for this precise reason alone. Assessee appeal of allowed.

Summary

Issues involved: Validity of reopening/reassessment u/s 147 of the Income Tax Act, 1961.

Summary:
The Appellate Tribunal ITAT Pune addressed the appeal of the assessee for the assessment year 2012-13, challenging the National Faceless Appeal Centre (NFAC) Delhi's Din and Order. The primary issue was the validity of the impugned reopening/reassessment where the Assessing Officer believed that the taxpayer's taxable income from the sale of immovable property had escaped assessment. The Tribunal noted that detailed verification and in-depth inquiry were required for the alleged income, as stated in the reopening reasons. In light of relevant cases such as PCIT vs. Manzil Dinesh Kumar Shah and PCIT vs. Maheswari Devi, the Tribunal found that such a course of action was not sustainable in sec. 148/147 proceedings. Consequently, the Tribunal quashed the reopening/reassessment solely on this ground, rendering all other merit-related issues academic. The assessee's appeal was allowed accordingly, with the order pronounced in open court on 14.05.2024.