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2023 (8) TMI 522 - BOMBAY HIGH COURTReopening of assessment u/s 147 - mandation of disposal of objection against reopening - reason to believe - HELD THAT:- If the order deciding the objections is perused, the same does not state that the facts mentioned by the petitioner were incorrect. In fact, no reasons whatsoever have been assigned and it is reiterated that the petitioner failed to declare any profit/ loss in the income tax return and hence the amount was treated as profit on the sale of shares. As stated above, despite specific objection that the said amount had been debited in the bank account of the petitioner and it pertained to the losses sustained in commodity trading having been shown in the accounts for the Financial Year 2011-12, Assessment Year 2012-13, it becomes clear that the objections have been decided without due application of mind. As held by the Hon’ble Supreme Court in GKN Driveshafts (India) Ltd [2002 (11) TMI 7 - SUPREME COURT] the objections as raised have to be disposed of by a speaking order that could indicate due application of mind. As stated above, there are no reasons whatsoever assigned for turning down the objections and the facts stated in the notice dated 24/3/2020 are reiterated. It is seen that alongwith the objections dated 13/9/2021 copy of the account statement for the Financial Year 2011-12 was also attached. Same has not even been referred to while disposing of the objections on 17/9/2021. In M/s. Shodiman Investments Pvt. Ltd [2018 (4) TMI 1287 - BOMBAY HIGH COURT] it is held that application of mind has to be indicated while forming reasons to believe that income chargeable to tax has escaped assessment. It is also to be noted that by issuing subsequent notice, the ITO has sought further information from the petitioner which information does not form the basis of the reasons assigned for re-opening the proceedings. The notice dated 24/3/2020 issued u/s 148 seeking reopening of the assessment is based on incorrect facts. The objections raised by the petitioner pointing out the relevant facts including the proper Assessment Year to which the said transaction pertained being Assessment Year 2012-13 coupled with the fact that the amount of Rs. 9,90,314/- that was stated to be the amount being profit from the sale of shares having been explained to be the amount of loss, the objections having been decided without any speaking order and not dealing with the undisputed factual aspects leads to the conclusion that the re-opening of the assessment is without there being any reason to believe that the income has escaped assessment. In these facts, the notice dated 24/3/2020 suffers from fundamental factual errors. Decided in favour of assessee.
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