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TMI Blog2022 (11) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proceedings are not in conformity with the provisions of section 149(1)(b) of the Act. As the requirement of provisions of section 149(1)(b) of the Act are not fulfilled in the present case, therefore, the reassessment proceedings under section 147 of the Act are set aside being bad in law. Accordingly, the impugned order passed by the learned CIT(A) upholding reassessment proceedings, which resulted in passing of order under section 143(3) r/w section 147 of the Act is set aside. As a result, ground raised by the assessee vide petition under Rule 27 of ITAT Rules, 1963 is allowed. - ITA No. 6670/Mum./2016 - - - Dated:- 31-10-2022 - SHRI M. BALAGANESH , ACCOUNTANT MEMBER AND SHRI SANDEEP SINGH KARHAIL , JUDICIAL MEMBER Assessee by : Shri A. K. Tibrewal a/w Shri Saurabh Gupta Revenue by : Shri P. R. Mane a/w Smt. Kanupriya Damor ORDER PER SANDEEP SINGH KARHAIL , J. M. The present appeal has been filed by the Revenue challenging the impugned order dated 25/08/2016 passed under section 250 of the Income Tax Act, 1961 ( the Act ) by learned Commissioner of Income Tax (Appeals)-8, Mumbai [ learned CIT(A) ], for assessment year 2006 07. 2. In this appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings under section 147 of the Act. 5. The brief facts of the case pertaining to this issue, as emanating from the record, are: The assessee is engaged in the business of trading in shares, goods and merchandise. For the year under consideration, assessee filed its return of income on 27/11/2006 declaring loss of Rs. 1,11,63,837. The return of income filed by the assessee was processed under section 143(1) of the Act and returned income was accepted. 6. Subsequently, vide notice dated 29/03/2012 issued under section 148 of the Act, reassessment proceedings were initiated in the case of the assessee on the basis of information received from SP, CBI Anti Corruption Bureau, Mumbai that assessee is one of the group companies, who are engaged in providing accommodation entries to various person, and its directors are operating 20 dummy concerns which have entered into bogus transactions with several concerns and provided accommodation entries. In response to the aforesaid notice, representation was made on behalf of the assessee and details as sought were filed. The Assessing Officer ( AO ) vide order dated 30/03/2013 passed under section 143(3) r/w section 147 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... letter dated 28.12.2011 has intimated that the assessee company, is one of the group Companies formed by Shri Arun Harsh Dalmia and is engaged in providing accommodation entries to various persons. The report of the ADICT (Inv.) is based on the report of ACB, CBI, Mumbai where in it is reported that the CBI, ACB, Mumbai has conducted investigation in the affairs of Shri Harsh Dalmia and Shri Arun Lal Saini, who are directors of M/s. Satya Securities P. Ltd. It is reported that they operate 20 dummy concerns which have entered into bogus transactions with several concerns and provided accommodation entries. The relevant part of the scrutiny report along with the covering letter of S.P., CBI and ACB, Mumbai is as under: SP's Report: Shri Dalmia's floated 20 companies has never paid taxes to the Government since all his concerns were shown to run in losses in almost all the years. The above said act on the part of Shri Arun Dalmia and Shri Harsh Dalmia constitute evasion of income tax. CBI and ACB, Mumbai's Report The CBI has reported that searches at the residence and office premises of Shri M. S. Bali and Dalmia's CBI Prima facie could find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Act 2021, which reads as under Time limit for notice. 149. (1) No notice under section 148 shall be issued for the relevant assessment year,- (a) . (b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to one lakh rupees or more for that year. 11. Thus, as per the aforesaid provisions, where 4 years, but not more than 6 years, have elapsed, no notice under section 148 can be issued unless the income chargeable to tax which has escaped assessment is Rs. 1 lakh or more. We find that while dealing with the issue whether failure on the part of the AO to mention the amount of income which has escaped assessment will result in nullifying the notice issued under 148 of the Act, the Hon ble Karnataka High Court in Novo Nordisk India (P) Ltd vs DCIT, [2018] 95 Taxmann.com 225 (Karn.) observed as under: It is mandatory for the Assessing Officer in his reasons recorded, to state that the escaped assessment amounts to, or is likely to be Rs.1,00,000/- or more, to bring it within the ambit of Section 149(1)(b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in the reasons as to which fact or material was not disclosed by the assessee fully and truly necessary for assessment of that assessment year, so as to establish vital link between the reasons and evidence. That vital link is the safeguard against arbitrary reopening of the concluded assessment. The reasons recorded by the Assessing Officer cannot be supplemented by filing affidavit or making oral submission, otherwise, the reasons which were lacking in the material particulars would get supplemented, by the time the matter reaches to the Court, on the strength of affidavit or oral submissions advanced. (emphasis supplied) 14. Since, it is duty of the AO to record the reasons clearly and unambiguously and no inference can be drawn there from, thus, respectfully following the aforesaid decisions, we are of the considered view that the impugned reassessment proceedings are not in conformity with the provisions of section 149(1)(b) of the Act. 15. As the requirement of provisions of section 149(1)(b) of the Act are not fulfilled in the present case, therefore, the reassessment proceedings under section 147 of the Act are set aside being bad in law. Accordingly, the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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