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TMI Blog2019 (11) TMI 1748X X X X Extracts X X X X X X X X Extracts X X X X ..... nvested money of Rs.59,42,709/- with its specified person M/s.NDPPL, whereas as per audited books of account and ledger copy of account of NDPPL the said sum was repayment of interest-free advance taken from NDPPL. 2. That, the Ld. C.I.T.(A) further erred in having upheld the re-opening of the completed assessment made u/s. 143(3) on his alleged satisfaction that money was reflecting in the opening of Poddar Institute of Management & Technology (sister unit) without reflecting the same by name in the books of the appellant in spite of the admitted fact that the sister unit is assessed jointly with the appellant-trust and as per his admission the same is reflected in the consolidated account of the appellant. 3. That, the Ld. C.I.T.(A) further erred in justifying the reopening of the assessment by assuming the refund of advance of Rs.59,42,709/-by the appellant to NDPPL as interest for the purpose of application of provisions of sec. 13(1 )(d) in spite of the fact that as per ledger copy of account of NDPPL, out of opening credit balance of Rs.77,42,709/- in the books of sister unit, repayment of Rs.59,42,709/- was made by the appellant itself and the balance outstanding was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to, abridge and/or rescind any or all of the above grounds." 3. The ld. Counsel for the assessee informs the Bench that the assessee does not want to press ground nos. 1 and 2 therefore, we dismiss them as not pressed. 4. Ground nos. 3 to 8 relate to reopening of assessment u/s 147/148 of the Act wherein the solitary grievance of the assessee is that addition of Rs.59,42,709/-, made in the assessment order u/s. 143(3)/l47 of the Act, dated 28.12.2016 on the basis of the reasons recorded was deleted by Ld. CIT(A)-25, Kolkata dated 30.07.2019, therefore, the other additions made in the said reassessment order which were not part of the reasons recorded for reopening the assessment are not sustainable in the eye of law. 5.The facts of the case which can be stated quite shortly are as follows: The assessee filed its return of income for the A.Y. 2009-10 on 30-09-2009 declaring total income to the tune of Rs. NIL. The return of income was processed u/s 143(1) of the Income Tax Act 1961 (hereinafter referred to as 'Act'). A survey u/s 133A of the Act was conducted by the Department and it was found that the assessee had deposited money with Nissan Developers & Properties Pvt. Ltd.( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.Y. 2009-10 was completed u/s. 143(3)/11 of the Act on 01/03.2011 and after a gap of five years, notice u/s 148 of the Act was issued on 22.03.2016 to reopen the assessment u/s 147 of the Act. The only reason for issuing the notice under section 148 of the Act as per reasons recorded on dated 17.08.2016 was that income of Rs.59,42,709/- had escaped assessment for having deposited money with the specified person M/s. Nissan Developers &Properties Pvt. Ltd. The said addition made in the assessment order u/s. 143(3)/l47 of the Act dated 28.12.2016,on the basis of the above reasons recorded was deleted by the Ld. C.I.T.(A)-25, Kolkata vide order dated 30.07.2019. In that view of the matter, the other additions made in the said reassessment order which were not part of the reasons recorded for reopening the assessment are not sustainable in the eyes of law and therefore, the reassessment order made by AO under section 147/148 of the Act is liable to be cancelled. 10. On the other hand, the ld. DR has primarily reiterated the stand taken by the Assessing Officer which we have already noted in our earlier para and the same is not being repeated for the sake of brevity. 11.We heard both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holding as charted above is almost 16.5%. Even after adding entire family members mentioned above share holding Project Ltd found during Nissan Developers & Properties Pvt Ltd, cannot be stated to be having substantial interest as per the provision of section 13(3). The issue of the Hon'ble ITAT Kolkata in case of ACIT Vs. Hooghly Engineering & Technology College Society, ITA No. 1579/Kol/2016, dated 04.07.2018 Hon'ble ITAT has observed that if the concerned person is entitled far 20 then it can be held to be having substantial interest and only then the provision of section 13(3) would be applicable.. Thus it is seen that the trustees either individually or through its relatives, or the concern found during the course interest in M/s. Nissan Developers & Properties Pvt Ltd as on 31.03.2009. There are total 38 persons (individual and companies) who are having share holding in the concern and more over the directors during the financia Therefore the concern M/s. Nissan Developers & Properties Pvt Ltd was covered by the provision of section 13(3) 5.2.8 In this case the assessment folder and survey folder is are perused. It is seen that in the ledger account of Poddar Found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment are not sustainable in the eyes of law even after insertion of Explanation 3 to section 147 of the Act by Finance Act, 2009. We note that AO may assess or reassess the income in respect of any issue which comes to his notice subsequently in the course of the proceedings though the reasons for such issue were not included in the notice; however, if after issuing a notice under section 148 of the Act, the AO accepted the contention of the assessee and holds that the income which he has initially formed a reason to believe had escaped assessment, has as a matter of fact not escaped assessment, it is not open to him independently to assess some other income, for that we rely on the judgment of Hon`ble Bombay High Court in the case of Jet Airways (I) limited 331 ITR 236 (Bom), wherein it was held as follows: "21. Explanation 3 lifts the embargo, which was inserted by judicial interpretation, on the making of an assessment or reassessment on grounds other than those on the basis of which a notice was issued under s. 148 setting out the reasons for the belief that income had escaped assessment. Those judicial decisions had held that when the assessment was sought to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course of these proceedings the AO comes to conclusion that some items have escaped assessment, then notwithstanding that those items were not included in the reasons to believe as recorded for initiation of the proceedings and the notice, he would be competent to make assessment of those items. However, the legislature could not be presumed to have intended to give blanket powers to the AO that on assuming jurisdiction under s. 147 regarding assessment or reassessment of escaped income, he would keep on making roving inquiry and thereby including different items of income not connected or related with the reasons to believe, on the basis of which he assumed jurisdiction. For every new issue coming before AO during the course of proceedings of assessment or reassessment of escaped income, and which he intends to take into account, he would be required to issue a fresh notice under s. 148." We note that in the assessee`s case under consideration, the assessment for A.Y. 2009-10 was completed u/s. 143(3)/11 of the Act on 01/03/2011. A notice under section 148 of the Act was issued on 22.03.2016 to reopen the assessment u/s. 147 of the Act. The only reason for issuing the said 148 n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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