9911796707
TMI Blog2022 (2) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... de his letter of even no. 918 dated 18/03/2013, Sh. Rakesh Gupta, Sh. Vishesh Gupta, Sh. Navneet Jain and Sh. Vaibhav Jain were involved in providing accommodation entries to various parties through their 37 paper entities in the form of bogus purchases. These accommodation entry providers have admitted that they were involved in providing accommodation entries, under oath in during the proceedings u/s 132(4),of I T Act and also in the statement recorded u/s 131 of IT Act. Once of the beneficiaries, who is stated to have received such accommodation entry of Rs. 32,16,435/- namely M/s Kumar Engg. Works, B-38, G.T. Karnal Road, Delhi falls in the territorial jurisdiction of this ward. I am satisfied that income to the tune of Rs. 32,16,435/- has escaped assessment within the meaning of section 147 of IT Act. Hence, this is a fit case for issue of notice u/s 148. Issued notice u/s 148 of IT Act in this cases for A.Y. 2006-07. Dated : 28-03-2013 Sd/- (Santhosh Kumar) Income Tax Officer, Ward-20(4), New Delhi" 3. Thereafter, the AO issued notice u/s 148 of the IT Act to the assessee, vide notice dated 28th March, 2013. In compliance to the statutory notices issued by the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red on facts and circumstances of the case and in law in not appreciating that in the absence of any cogent material the Assessing Officer it could not be made that the transaction between the Appellant and M/s Shree Balajee Trading Co. and M/s Sarashwati Trading Co. was a sham transaction and further erred in making an addition of Rs. 26,77,763/- to the income of the Appellant. 6. That the Assessing Officer erred on facts and in law in charging interest under section 234B of the Act. The Appellant craves leave to add, alter, amend or vary from the aforesaid grounds of appeal at or before the time of hearing." 6. Ground No.1 by the assessee being general in nature is dismissed. 7. The ld. Counsel for the assessee submitted that ground of appeal Nos.2-4 are regarding the validity of the reassessment proceedings. He submitted that the original assessment in the instant case was completed u/s 143(3) of the Act on 23rd July, 2008. Referring to page 17 of the paper book, he drew the attention of the Bench to the reasons recorded and submitted that the notice u/s 148 has been issued on 28th March, 2013 which is beyond a period of four years. He submitted that there is no allegation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee. He forms an opinion. The reassessment will be invalid because the AO had formed an opinion in the original assessment, though he had not recorded his reasons. He submitted that the above decision of the Full Bench of the Hon'ble Delhi High Court is squarely applicable to the facts of the present case. 9. The ld. DR, on the other hand, heavily relied on the orders of the AO and the CIT(A). 10. We have heard the rival arguments made by both the sides, perused orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find, the AO, in the instant case, completed the original assessment u/s 143(3) on 23rd July, 2008 determining the total income of the assessee at Rs. 52,22,785/- as against the returned income of Rs. 51,65,251/-. We find, the AO, on the basis of the information received from the Addl.CIT, Central Range, New Delhi, that the assessee is a beneficiary of accommodation entries amounting to Rs. 32,16,435/- from concerns run by Navneet Jain, Vaibhav Jain, Rakesh Gupta and Vishes Gupta, reopened the assessment, the reasons of which are already reproduced in the preced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment order itself records that the issue was raised and is decided in favour of the assessee. Reassessment proceedings in the cases will be hit by the principle of "change of opinion". Reassessment proceedings will be invalid in case an issue or query is raised and answered by the assessee in original assessment proceedings but thereafter the Assessing Officer does not make any addition in the assessment order. In such situations it should be accepted that the issue was examined but the Assessing Officer did not find any ground or reason to make addition or reject the stand of the assessee. He forms an opinion. The reassessment will he invalid because the Assessing Officer had formed an opinion in the original assessment, though he had not recorded his reasons. The expression "change of opinion" postulates formation of opinion and then a change thereof. In the context of assessment proceedings, it means formation of belief by an Assessing Officer resulting from what he thinks on a particular question. It is a result of understanding, experience and reflection. A distinction must be drawn between erroneous application/interpretation/ understanding of law and cases where fresh or n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry, claim, deduction. When the Assessing Officer fails to examine a subject-matter, entry, claim or deduction, he forms no opinion. It is a case of no opinion. Whether or not the Assessing Officer had applied his mind and examined the subject-matter, claim, etc., depends upon factual matrix of each case. The Assessing Officer can examine a claim or subject- matter even without raising a written query. There can be cases where an aspect or question is too apparent or obvious to hold that the Assessing Officer did not examine a particular subject-matter, claim, etc. The stand and stance of the assessee and the Assessing Officer in such cases are relevant." 13. Since, in the instant case, the original assessment was completed u/s 143(3) of the IT Act, the issue of purchases was examined by the AO during the course of assessment proceedings, therefore, in absence of any allegation by the AO in the reasons that there is any failure on the part of the assessee to disclose fully and truly all material facts necessary for completion of the assessment, the reassessment proceedings, in our opinion, are not in accordance with the law. We, therefore, quash the reassessment proceedings. The gr ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
