Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram

TMI Blog

Home

2025 (1) TMI 500

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... t subsist then the ld. AO looses jurisdiction to assess other issues of concealment that comes to his knowledge. AO was required to stop at the point when he found that the issue of cash deposit into bank account was out of genuine sources and was required to pass a NIL order. Once it is found that none of the reasons recorded by the AO for initiating proceedings under section 147 was germane to initiation of such proceedings, then it has to be held that the AO had no reason to believe that any income had escaped assessment and, therefore, any further proceeding would be without jurisdiction. But still he moved further without having jurisdiction and made other additions in the assessment which is illegal as the AO has exhausted his jurisdiction as soon as he was satisfied that the cash deposit in the bank account of the assessee, for which the case of the assessee was reopened under the provisions of section 147 read with section 148 of the IT Act, was satisfactorily explained - we are of the view that the other disallowances/additions made by the AO in the assessment order are illegal - Appeal of the assessee is allowed. - Dr. S. Seethalakshmi, JM And Shri Gagan Goyal, AM For t .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 4 and uploaded in the online account on the same day. 3. As the Hon ble CIT (A) did not allow any relief to us and hence we decided to file appeal before the Hon ble ITAT, JaipurBench, Jaipur and as per provisions of section 253(3) of the Income Tax Act, 1961 the appeal was required to be filed on or before 3rd August, 2024. However, the same could not be filed in time due to the reason that our counsel Shri Ravindra Kumar Jain, Advocate had to be admitted in hospital on 10.07.2024 for cardiac problem and was operated on 11.07.2024 and he was advised by the treating doctor to take bed rest till 1 month from the date of operation. Before expiry of one month on 4th August, 2024 his brother Shri Chandresh Kumar Jain, advocate had expired. On account of these reasons Shri Ravindra Jain could not attend his office till 16th August, 2024. Even during this period from 11.07.2024 to 18.08.2024 his mobile phone was also switched off as per advice of treating doctor. After his joining the office he took stock of his pending matters and only thereafter necessary preparations could be made for filing the instant appeal before the Hon ble ITAT. 4. That the delay occurred in filing the appeal wa .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... under consideration, the AO vide notice under section 148A(b) of the IT Act, 1961 afforded an opportunity to the assessee to explain the source of cash deposit in its bank account. However, no reply was filed by the assessee. Accordingly, the case of the assessee was reopened by issuing notice under section 148 of the IT Act, 1961 dated 29.03.2022 requiring the assessee to file its return of income. In response, the assessee filed its return of income declaring Nil income after claiming deduction of Rs. 1,14,509/- under section 80P on 16.01.2023. The AO framed the assessment under section 143(3) read with section 147, read with section 144B of the IT Act, 1961, after duly considering the submissions enclosing therewith relevant documents filed by the assessee, by passing the impugned order with an assessed income of Rs. 6,77,341/- on account of proposed addition on account of Interest income under section 56 of the IT Act of Rs. 5,62,832/- and addition on account of proposed disallowance under section 80P of Rs. 1,14,509/-. 6. Aggrieved by the order of the Assessing Officer, the assessee-challenged the action of the AO by preferring an appeal before the ld. CIT (Appeals). At the ap .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... is notice subsequently in the course of proceedings under this section. The second limb of this proviso i.e. for assessing other issues can only be invoked if first limb is satisfied i.e. when an addition/ disallowance is being made on the issue which was formed the basis for initiation of reassessment proceedings. As in the instant case since no addition/ disallowance was made on the reasons framed for issue of notice u/s 148 the ld. AO was not entitled to make other disturbances in the ITR. The appellant relies on following judicial pronouncements in this regard :- 1. CIT vs Shri Ram Singh [2008] 306 ITR 343 (Raj.) Relevant Para no. 29 and 32 at case law APB 8. 2. CIT vs. Jet Airways (I) Ltd. (2011) 331 ITR 236 (Bom)(HC) Relevant para no. 16 and 17 at case law APB 17 3. Ranbaxy Laboratories Ltd. - vs. CIT (2011) 336 ITR 136 (Delhi High Court) - Relevant para no. 21 at case law APB 28. 4. ITO v Bidbhanjan Investment Trading CO (P ) Ltd ( 2011) 59 DTR 345 ( Mum) (Trib) Relevant para no. 17 at case law APB 35. 5. Dy. CIT v. Takshila Educational Society (2016) 378 ITR 520 (Pat.) (HC) Relevant para is last but one at case law APB 39. 6. Sheela Foam Ltd. v/s DCIT (Delhi ITAT) (ITA No. .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... e relevant findings of the Hon`ble Rajasthan High Court in the case of CIT v/s Shri Ram Singh (306 ITR 343) :- 29. To clarify it further, or to put it in other words, in our opinion, if in the course of proceedings under section 147, the AO were to come to conclusion, that any income chargeable to tax, Which, according to his reason to believe , had escaped assessment for any assessment year, did not escape assessment, then, the mere fact, that the AO entertained a reason to believe, albeit even a genuine reason to believe, would not continue to vest him with the jurisdiction, to subject to tax, any other income, chargeable to tax, which the AO may find to have escaped assessment, and which may come to his notice subsequently, in the course of proceedings under section 147. 30.xxx xxx 31. xxx xxx 32. The result of the aforesaid discussion is, that the question framed, in the order dated. 23rd May, 2006, is required to be, and is, answered in the manner, that the Tribunal was not justified in holding, that the proceedings for reassessment under section 148/147 were initiated by the AO, on non-existing facts. because ultimately the assessee has been able to explain the income, which .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

 

 

 

 

Quick Updates:Latest Updates