2024 (8) TMI 347 - AT - Income Tax

Reopening of assessment u/s 147 - second subsequent reassessment on same issues - Unexplained purchases - information received from sales tax department that assessee has made purchase from one party which has been blacklisted by Sales Tax Department - HELD THAT - As none of the lower authorites despite bringing this fact on record have been bothered to look into this matter that already assessment order u/s. 147/143(3) has been made on the addition of alleged bogus purchase and this addition has attained finality. This shows casual approach and complete non application of mind and callousness. Reopening the case again and sending notice u/s 148 twice in a gap of a year and dragging the assessee to the litigation and creating another demand simply because both the AO and appellant authority have not bothered to examine the facts which has been brought on record and harassing the assessee for unwanted litigation for several years as first appeal has been decided after more than 7 years. Be that as may be, the impugned assessment order passed by the AO u/s. 144/147 is here by quashed, because already earlier assessment order was passed u/s. 143(3)/147 on 19/03/2015 making the same addition. Decided in favour of assessee.

Summary

Issues:
1. Reopening of Assessment
2. Addition as unexplained purchase of Rs. 4,25,880

Reopening of Assessment:
The appeal was filed against the order passed by additional/JCIT(A)-2 Delhi for the quantum of assessment under section 144. The JCIT(A) decided the appeal ex-parte due to the assessee's lack of response to notices, leading to dismissal for want of prosecution. The assessee raised grounds challenging the reopening of assessment, arguing that the second notice under section 148 was beyond the four-year period and lacked tangible material for reassessment. The appellant contended that the reassessment on the same addition was bad in law. The counsel highlighted that the assessment order had already been passed based on the same information, making the subsequent reassessment redundant. The AO's failure to verify records or consider the previous assessment led to the dismissal of the appeal by the CIT(A) on the grounds of non-compliance with notices.

Addition as unexplained purchase of Rs. 4,25,880:
The AO added the sum of Rs. 4,25,880 as unexplained purchases from a specific party, leading to a higher assessed income. The assessee contended that the addition was accepted previously, and no appeal was filed, indicating finality. The AO's oversight in issuing another notice for the same addition without verifying previous assessments was highlighted. Despite the appellant's submission of the finalized assessment and lack of new evidence, the CIT(A) dismissed the appeal based on non-compliance with notices. The Tribunal quashed the impugned assessment order, citing the casual approach and non-application of mind by the authorities, leading to unnecessary litigation and harassment of the assessee. The Tribunal allowed the appeal, emphasizing that the earlier assessment order had already addressed the same addition, rendering the reassessment invalid.

In conclusion, the Tribunal allowed the appeal, emphasizing the finality of the previous assessment on the disputed addition and criticizing the authorities for their casual approach and failure to consider existing records, leading to unnecessary litigation for the assessee.