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TMI Blog2025 (3) TMI 1041X X X X Extracts X X X X X X X X Extracts X X X X ..... ifaur Rahman, Accountant Member For the Assessee : Shri Pavan Ved, Advocate, Shri Mohit Gupta, CA, Shri Mirza Baig, CA And Shri Sarthak Agarwal, CA For the Revenue : Ms. Harpreet Kaur Hansra, Sr. DR ORDER PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER : 1. The Revenue has filed the appeal against the order of the ld. Commissioner of Income Tax (Appeals)-29, New Delhi ["ld. CIT(A)", for short] dated 04.04.2024 for the AY 2016-17 and the assessee has also filed the cross objections for AY 2016-17. 2. The grounds of appeal raised by the Revenue in ITA no. 2448/DEL/2024 are as under: - 1. Whether Ld. CIT(A) is right in quashing the re-assessment order by holding that no addition was made on the issue which was the basis of reason recorded by the AO in view of decision of Hon'ble Karnataka High Court in the case of N. Govinda Raju Vs ITO [20l5] 377 ITR 243 (Karn.) (HC) wherein it was held that addition can be made on other issues during the course of proceedings under section 147, even though reason for notice for 'such income' which may have escaped assessment may not survive? 2. Whether Ld. CIT(A) is right in relying upon the decision of Hon'ble Delhi High Court in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ortunity both to the assessee as well as the Ld. AO and therefore, the appeal of the Ld. AO needs to be dismissed at inception being frivolous, erroneous and without any merits. 7. That the appellant craves to add, amend, alter or withdraw any Ground or Grounds of Appeal." 4. During the course of hearing, the Ld. Authorized Representative [AR] for the assessee placed following written submissions on record: - "I. Issue:- "When the no addition has been made by the Ld. AO on the issues/reasons based on which the notice u/s 148 was issued then the Ld. AO cannot make addition or assess any other income in lieu of some other issue for which reasons have not been recorded by the Ld. AO while issuing the notice u/s 148 for reopening the assessment within the meaning of section 147 r.w.s. 148 of the Act" II. Facts of the Matter: The captioned case for AY 2016-17 was re-opened on the basis of reasons for re-opening recorded vide notice/letter dated 08.12.2021 wherein the sole reason mentioned in the said reasons for re-opening was "alleged bogus unsecured loans". Copy of the said reasons recorded u/s 148 for re-opening the proceedings u/s 147 are enclosed herewith at Pg nos. Howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reopened u/s 147. Since no additions were made by AO on the issue of unsecured loans, he could not have proceeded to make addition on other issues without the issuance of fresh 148 notice. The ratio of the decisions of the Hon'ble Delhi High Court squarely apply to the facts of this case since the Assessing Officer did not make any addition for which the reopening was made. The Assessing Officer made various other additions other than the addition for which the assessment was reopened. In view of the above, respectfully following the above decisions of the jurisdictional High Court, 1 hold that the reassessment order passed by the Assessing Officer under Section 143(3) read with Section 147 of the Act is bad in law and the same is quashed on this ground." In view of above stated facts and settled law, it is hereby prayed that the order of the Ld. CIT(A) may kindly be upheld wherein the impugned assessment order dated 31.03.2022 has been rightly quashed and thus the appeal of the revenue needs to be dismissed." 5. Brief facts of the matter are that the case of the assessee company was reopened vide notice u/s 148 of the Act dated 27.03.2021 on account of alleged information recei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act against which the assessee company has filed Cross Objections. 9. During the course of hearing, the Ld. AR for the assessee most vehemently argued that the Ld. CIT(A) has rightly quashed the reassessment order so framed u/s 147 of the Act dated 31.03.2022 by the Ld. AO by following the ratio laid down by the Hon'ble jurisdiction High Court of Delhi in case of Ranbaxy Laboratories Ltd. vs CIT [2011] 336 ITR 136 (Del.) whereby the Hon'ble High Court vide order dated 03.06.2011 observed & held at Para 15 as under: - "15. In Dr.Devendra Gupta's case (supra), learned Tribunal has relied upon the judgment of the Punjab & Haryana High Court, in Atlas Cycle Industries case (supra), and concluded that the basic condition is, that the AO has reason to believe, that any income chargeable to tax has escaped assessment, for any assessment year, and it was found, that the section puts no bar on the powers of the AO, to put to tax, any other income, chargeable to tax, which has escaped assessment, and which subsequently comes to his notice, in the course of the proceedings, but then, the prefixing words "and also", which succeeded "any income chargeable to tax has escaped assessment f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the jurisdiction may have changed on the basis of search or survey proceedings carried on. He, however, pressed upon the judgement of Hon'ble Delhi High Court in case of Pr. CIT(Central)-3, New Delhi Vs. Jakhotia Plastics (P) Ltd which, in our view, was rendered nugatory in view of the recent judgement of the Hon'ble Delhi High Court in case of PCIT(Central)-1 vs M/s Mideast Integrated Steels Ltd in ITA no. 1482/2018 order dated 10.09.2024. 13. Considered the rival submissions and perused the material placed on record. We find that the whole appeal revolves around the issue that no addition can be made to other issues for which reasons were not recorded while issuing notice u/s 148 of the Act if no addition has been made on the issues for which reasons were recorded for re-opening of the assessment. The Revenue relied upon the judgements of Hon'ble Karnataka High Court in the case of N. Govinda Raju Vs ITO [20l5] 377 ITR 243 (Karn.) (HC) and Hon'ble Delhi High Court in case of Pr. CIT(Central)-3, New Delhi Vs. Jakhotia Plastics (P) Ltd to support its contention that the Ld. CIT(A) was not right in quashing the assessment order dated 31.03.2022 in which order no additions wer ..... 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