9911796707
TMI Blog2015 (11) TMI 486X X X X Extracts X X X X X X X X Extracts X X X X ..... reopened. These two additions at (i) and (ii) are accordingly deleted.- Decided in favour of assessee. - ITA No. 496/Bang/2014 - - - Dated:- 9-10-2015 - Vijaypal Rao, JM And Jason P Boaz, AM For the Appellant : Shri S Venkatesan, CA For the Respondent : Shri Sunil Kumar Agarwala, JCIT (DR) ORDER Per Shri Jason P Boaz, AM This appeal by the assessee is directed against the order of the CIT (Appeals), Mysore dt.26.2.2014 for Assessment Year 2008-09. 2. The facts of the case, briefly, are as under :- 2.1 The assessee, an individual carrying on real estate business, filed its return of income for Assessment Year 2008-09 on 31.3.2009 declaring income ofRs.53,58,050 which was processed under Section 143(1) of the Income Tax Act, 1961 (in short 'the Act'). A survey under Section 133A of the Act was conducted in the case of M/s. Phaneesh Granites Pvt. Ltd. on 31.10.2011, wherein the assessee was a Director. At the time of survey action, the Department noticed from documents found at the premises that the assessee had entered into a transaction vide Registered Sale Deed dt.23.7.2010 for sale of land at S.No.231/1, Bogadi village, Kasba Hubli, Mysore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000 In the aforesaid order of assessment, the Assessing Officer has made several additions / disallowances including a sum of ₹ 1 Crore out of the advance given to Sri Mohammed Ahmed, which was considered as the investment / asset not declared by the assessee as per the reasons recorded for initiating assessment proceedings under Section 147 of the Act. This would imply, in other words, that the Assessing Officer had accepted a sum of ₹ 1,27,78,130 of the advance of ₹ 2,27,78,130 given to Sri Mohammed Ahmed vide sale agreement dt.18.7.2007 as only a sum of ₹ 1 Crore was added back to the income of the assessee on this count. 2.2 Aggrieved by the order of assessment for Assessment Year 2008-09 dt.22.3.2013, the assessee preferred an appeal before the CIT (Appeals), Mysore. In the grounds raised before the learned CIT (Appeals), the assessee challenged the reopening of the assessment as well as the additions made by the Assessing Officer. The assessee also filed certain additional evidences vide letter dt.13.8.2013 seeking their admission and written submissions dt.8.11.2013. The learned CIT (Appeals) called for a remand report from the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to assume jurisdiction under Section 148 of the Act did not exist and have not been complied with and further the reopening was on the wrong ground and reason which would not induce any belief that income has escaped assessment and consequently, the re-assessment ought to have been cancelled by the CIT (Appeals). 3.1 Without prejudice to the above, the learned CIT (Appeals) has erred in sustaining the following additions. a) The amount deposited in bank account by the appellant on 13.3.2008 : ₹ 4,50,000. b) Deficit cash balance on 5.4.2007 and 7.4.2007 : ₹ 2,98,176 3.2 The learned CIT (Appeals) failed to appreciate the explanation that the appellant is the Managing Partner of 3 firms and Managing Director of 2 companies and has been the custodian of the funds of the above 3 firms and 2 companies and such funds used to be in his possession and control and he used to deposit such funds in his own bank account and in the bank accounts of the 3 firms and 2 companies, which are managed by him as and when required without passing corresponding entries in the books of accounts and under the factual matrix, there is no justification in rejecting the explana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is clear that the assessment made under Section 143(3) rws 147 of the Act requires to be cancelled and in support of this contention placed reliance on the decision of the Hon'ble Rajasthan High Court in the case of CIT Vs. Shri Ram Singh (2008) 217 CTR (Raj) 345 and of the Hon'ble Bombay High Court in the case of Jet Airways (I) Ltd. reported in 331 ITR 236 (Bom.). 5.2 Per contra, the learned Departmental Representative supported the impugned order of the learned CIT (Appeals), contending that the existence of reasons at the time of reopening the assessment was sufficient. He submitted that merely because the addition is deleted by the learned CIT (Appeals) later, on appeal, does not mean that the reopening of the assessment is bad in law. It was submitted that the assessee had not sought for the reasons recorded for reopening the assessment form the Assessing Officer during assessment proceedings. It was only before the learned CIT (Appeals) that the assessee sought for the reasons recorded and the learned CIT (Appeals) declined to interfere. It was submitted by the learned Departmental Representative that in view of the above, the reopening of the assessment by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of proceedings under s. 147-Once the AO came to the conclusion, that the income, with respect to which he had entertained reason to believe to have escaped assessment, was found to have been explained, his jurisdiction came to a stop at that, and he did not continue to possess jurisdiction, to put to tax, any other income, which subsequently came to his notice, in the course of reassessment proceedings, which were found by him, to have escaped assessment. A similar view has also been taken by the Hon'ble Bombay High Court in the case of CIT V Jet Airways reported in 331 ITR 236. 5.3.3 In the case on hand, the Assessing Officer reopened the assessment in respect of the income on account of advance given by the assessee for purchase of land and an addition of ₹ 1 Crore was made by the Assessing Officer on this account while passing the re-assessment order. However the learned CIT (Appeals) deleted the said addition of ₹ 1 Crore made by the Assessing Officer which was the reason for initiation of proceedings under Section 147 of the Act and the Assessing Officer has accepted the finding of the learned CIT (Appeals) and not preferred any appeal before the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
