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TMI Blog2022 (3) TMI 728X X X X Extracts X X X X X X X X Extracts X X X X ..... ansaction of ₹ 75 Lakhs availed from JMPL. The petitioner had availed loan from multiple entities. This propelled the Assessing Officer to seek details of unsecured loans/deposits in a prescribed format. Not only the information was furnished by the petitioner but all the supporting documents were submitted. It can hardly be gainsaid that all the primary facts were placed before the Assessing Officer by the petitioner. Respondents made an endeavour to draw home the point that though the information and documents were furnished, yet the petitioner did not disclose all the relevant information. The genuineness of the transaction and the creditworthiness of the creditor could not be ascertained at that point of time, on account of non-disclosure of the relevant facts. The submission of Mr. Suresh Kumar that the information and documents so furnished did not equip the Assessing Officer to draw inference about the non-genuineness of the transaction and question the creditworthiness of the creditor, cuts the revenue's case in two ways. First, it implies an admission that all the primary facts were placed before the Assessing Officer. Second, the revenue's stand become ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2013-14, came to be rejected. 2. The petitioner is a limited company incorporated under the Companies Act, 1956. It is engaged in the business of real estate development. For the assessment year 2013-14, the petitioner filed return of income on 29th November 2013. It was accompanied by a Tax Audit Report under Form No.3CD. A revised return was filed on 27th November 2014. The petitioner's case was selected for scrutiny assessment. Notices were issued to the petitioner under section 142(1) of the Act. The petitioner was, inter-alia, directed to submit details of unsecured loans in the prescribed format. The petitioner furnished requisite details and gave the information as solicited. The petitioner furnished the documents disclosing the identity, credit worthiness of the creditors as well as genuineness of the loan transactions, including acknowledgment of income tax returns and account statements evidencing the transactions through banking channel. Upon due satisfaction, the Assessing Officer passed an assessment order under section 143(3) of the Act on 26th February 2016. 3. On 23rd January 2018, a search action under section 132 of the Act was carried out qua petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered, during the course of the original assessment, the impugned exercise clearly falls within the realm of change of opinion which is legally impermissible. Third, there is no independent application of mind by the Assessing Officer as the assessment was proposed to be reopened merely on the basis of the information received from Investigation Wing of the department, namely DDIT, Inv. Unit 4(3), Thane. 9. An affidavit-in-reply is filed on behalf of the respondents. The respondents have made an endeavour to support the impugned action on the ground that the income escaped assessment solely on account of the failure of the petitioner to make a full and true disclosure of the material facts. It was incumbent upon the assessee to disclose the identity and creditworthiness of the lender and the genuineness of the transaction. In the case at hand, the lack of creditworthiness, and non-genuine nature of the loan transaction could be ascertained only post search action under section 132 of the Act. Therefore, since under section 153A of the Act the assessment which was completed could not be reopened, in the absence of incriminating material found during the search, the responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash/cheque/DD). (iii) PAN and assessment particular of the creditor including details regarding the AO having jurisdiction over him. 13. The aforesaid communication was followed by a questionnaire dated 27th October 2015, whereby the following information, inter-alia, was solicited : 1) Please submit the loan confirmation in respect of all the loans taken rectified in your Balance Sheet. 2) Please submit evidence in support of genuineness creditworthiness of loan parties in respect of new loans additional loans taken from existing loan parties. In case of failure, it is proposed to disallow the amount of new/additional loans taken for want of verification of genuineness and creditworthiness of loan parties. Also submit utilization of loan funds along with supporting documents. 14. In the reply dated 3rd December 2015 (Exh. D to the petition), the petitioner furnished following information . 1. CONFIRMATION OF UNSECURED LOANS : (also at Sr.No.33 of 1st questionnaire. dt.17-7-15) The Total Unsecured Loans outstanding as on 31-03-2013 are These are mainly additional loans from existing loans creditors and few additional loans from new cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly the information solicited by the Assessing Officer during the course of scrutiny assessment under section 143 of the Act, Mr. Mistri would urge, there is no room to allege that the income escaped assessment on account of the failure on the part of the assessee to disclose truly and fully all the relevant material. 18. We are persuaded to hold that, in the facts of the case, the submission appears impeccable. Indisputably, the petitioner had disclosed the unsecured loan transaction of ₹ 75 Lakhs availed from JMPL. The petitioner had availed loan from multiple entities. This propelled the Assessing Officer to seek details of unsecured loans/deposits in a prescribed format. Not only the information was furnished by the petitioner but all the supporting documents were submitted. It can hardly be gainsaid that all the primary facts were placed before the Assessing Officer by the petitioner. 19. Mr.Suresh Kumar, the learned counsel for the respondents made an endeavour to draw home the point that though the information and documents were furnished, yet the petitioner did not disclose all the relevant information. The genuineness of the transaction and the creditworthiness ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer to complete all the assessments which are required to be scrutinized by him under Section 143(3) of the Act. Moreover, one must not forget that the manner in which an assessment order is to be drafted is the sole domain of the Assessing Officer and it is not open to an assessee to insist that the assessment order must record all the questions raised and the satisfaction in respect thereof of the Assessing Officer. The only requirement is that the Assessing Officer ought to have considered the objection now raised in the grounds for issuing notice under Section 148 of the Act, during the original assessment proceedings 24. The next submission on behalf of the petitioner that proposed reopening of the assessment suffers from the vice of 'change of opinion' also appears well founded. Evidently, the search action under section 132 of the Act, did not reveal any tangible material qua the transaction of unsecured loan from JMPL. In fact, the petitioner was called upon to explain the very transaction, in respect of which, during the course of scrutiny assessment, the then Assessing Officer had already solicited information and documents. Eventually, during the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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