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TMI Blog2021 (1) TMI 729X X X X Extracts X X X X X X X X Extracts X X X X ..... beyond 4 years, therefore we restrict ourselves to adjudicate on jurisdiction issue and not going into merits of the case - Decided in favour of assessee. - I.T.A. No. 3012/Mum/2017 - - - Dated:- 8-12-2020 - Shri S. Rifaur Rahman, AM And Shri Pavan Kumar Gadale, JM For the Appellant : Dr. K. Shivaram, AR For the Respondent : Shri R. Bhoopathi, DR ORDER PER S. RIFAUR RAHMAN (ACCOUNTANT MEMBER): The present appeal has been filed by the assessee against the order of Ld. Commissioner of Income Tax (Appeals)-24, in short Ld. CIT(A) , Mumbai, dated 14.02.17 for AY 2007-08. 2. The brief facts of the case are that assessee is engaged in the business of wholesale retail marketing of consumer goods. The return was filed on 26.10.2007 declaring total income of ₹ 1,06,84,159/-. Later on, the case was selected for scrutiny and notice u/s 143(2) was issued on 17.09.2008 which was duly served on the assessee. Thereafter, assessment order u/s 143(3) was passed by the AO determining the total income at ₹ 1,09,00,990/-. 3. On information from Investigation Wing, it was alleged that assessee is indulged in bogus purchases. Accordingly, assessment wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plying such reaons to the appellant on request. In view of the above the reassessment made is held invalid. 2.4.4. In view of the above discussion the reopening of assessment is held valid since there was tangible material available with the AO at the time of reopening the assessment in the form of information received from the DIT investigation. Further, as the assessment is reopened based on the evidence collected and statements recorded during the course of Sales Tax Departments investigation of bogus sellers , the AO has a reason to believe that income has escaped assessment and there is no change of opinion . The reopening proceedings are, therefore, upheld and the ground is dismissed. 6. Ld. CIT(A) also dismissed the contention of assessee with regard to addition on account of alleged accommodation bills with the following observations:- 7 Based on the evidence in hand in the form of a report from DIT (lnv), Mumbai, the AO has asked the assessee to produce the parties along with evidence in order to verify the genuineness of the purchase transactions. The assessee instead submitted the ledger accounts of the above parties and bank statement extracts eviden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AO. The appellant has without prejudice contended that purchases from the alleged accommodation bill provider was wrongly taken by the AO at ₹ 97.47.147/- as against the actual amount of ₹ 92 94 953/- The AO is therefore directed to take the correct figure for computing the 15% of disallowance. The issue of estimation of 15% of the so called bogus purchases is in principle confirmed and subject to the above observation the grounds of appeal are dismissed. 7. Now before us, the assessee is in appeal challenging the order of Ld. CIT(A) on the grounds mentioned below:- I. Reassessment after the expiry of four years is bad in law. 1. The Learned CIT(A) failed to appreciate that, there was no failure on the part of the assessee to disclose truly and fully all material facts necessary for assessment, Assessing Officer has passed the original order after considering all the relevant materials, hence the reassessment is bad in law on facts and circumstances hence liable to be quashed. 2. Without prejudice to above the learned CIT(A) erred in not following the ratio of Jurisdictional High Court and erred in relying on case laws which are not applicab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led the return of income under protest. In response, assessing officer supplied the reasons for reopening the assessment which is placed at page 61 and 62 of the paper book. Ld. A.R submitted that as per the reasons, the assessing officer reopened the assessment based on the information received from DGIT (INV) Mumbai. The main reasons to reopen the assessment was that it is alleged that the assessee has purchased accommodation bills from a concern Cape Town Mercantile Private Limited and relying on statement of Shri Praveen Kumar Jain. Further it was stated that assessee has not made full and true disclosure of income and its particulars in the return. He brought to our notice page 64 of the paper book in which assessee has raised various objections for reopening of the assessment. From the above letter submitted before assessing officer, he brought to notice difference in the name of the party that the name of the party is Cape Town Mercantile Company Private Limited whereas the assessing officer relied on the statement of Shri Praveen Kumar Jain and initiated the proceedings with the party name Cape Town Mercantile Private Limited. And also brought to our notice difference in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (2020) 422 ITR 520 (Bom) (HC). 12. On the other hand, learned DR submitted that the reopening of the assessment was made based on the information from external agencies therefore the reopening of the assessment is proper and with regard to merits of the case he relied in the orders of CIT(A) and AO. 13. Considered the rival submissions and material placed on record. We notice from the records placed before us that the original assessment under section 143(3) of the Act was passed on 30.10.2009 by making certain additions. The reopening of the assessment was initiated by issue of notice under section 148 of the Act on 08.04. 2014. It is a fact on record that the reopening of the assessment was made beyond 4 years of the present assessment year 2007 08 even though the reassessment was initiated based on the information i.e., sales tax Department. At the same time, we notice from record that the reassessment was initiated by issue of notice under section 148 on the basis that the information received from DGIT investigation and in turn based on statement of Shri Praveen Kumar Jain. When the assessee was sought for the reason of reopening of the assessment and based on the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on 1-3-2001. The notice issued was dated 5-11-2002, and received by the assessee on 7-11-2002. Under those circumstances, the notice was clearly beyond the period of four years. [Para 19] The reasons recorded by the Assessing Officer nowhere stated there was failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment of that assessment year. The reasons are required to be read as they were recorded by the Assessing Officer. No substitution or deletion is permissible. No additions can be made to those reasons. No inference can be allowed to be drawn based on reasons not recorded. It is for the Assessing Officer to disclose and open his mind through reasons recorded by him. He has to speak through his reasons. It is for the Assessing Officer to reach to the conclusion as to whether there was failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for the concerned assessment year. It is for the Assessing Officer to form his opinion. It is for him to put his opinion on record in black and white. The reasons recorded should be clear and unambiguous and should not suff ..... X X X X Extracts X X X X X X X X Extracts X X X X
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