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2015 (5) TMI 81 - BOMBAY HIGH COURT

2015 (5) TMI 81 - BOMBAY HIGH COURT - TMI - Reopening of assessment - unaccounted loans - revenue submitted that all the four parties concerned had facilitated accommodation entries to assessee - Held that:- Unable to agree with revenue since the Petitioner has clearly stated that all the payments were made by account payee cheques which were encashed in the bank account of the Petitioner in the regular course of business. We find that the Petitioner has also paid interest on this loans after de .....

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r the Assessing Officer or the revenue to come to a conclusion that income had escaped assessment. All the communication and evidence provided by the Petitioner to the revenue authorities disclosed that the loans were bonafide, taken in the regular course of business through account payee cheques. Thus the proposed reopening lacks justification and the impugned notice deserves to be quashed had set aside. - Decided in favour of assessee. - Writ Petition No. 167 of 2015 - Dated:- 15-4-2015 - S. C .....

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bjection to the reasons forming the basis for issuing the impugned notice. The Petitioner is a partnership firm and the original assessment was completed under Section 143(3) of the Act. During the scrutiny of the assessment, the Petitioner was on 3rd November, 2008 required to answer certain questions at Serial Nos. 8, 12 and 14 of the questionnaire pertaining to details regarding loans and advances both secured and unsecured and information regarding interest. The Petitioner filed a detailed r .....

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ons for the proposed reopening. 3. The reasons were then supplied to the Petitioner on 21th May, 2014. The Petitioner submitted its objections to the reopening on 7th November, 2014. The Petitioner inter alia contended that the notice in question was issued beyond the period of four years from the end of the relevant assessment years. The assessment had already been completed under Section 143(3) of the Act and there was no basis or tangible material to justify reopening. The Petitioner also poi .....

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ce with law. This order dated 19th December, 2014 has led to the filing of this petition. 5. An affidavit of Mr. V.K.Mangla, Assistant Commissioner of Income Tax, 24(3), Mumbai dated 25th February, 2015 has been filed in reply on behalf of Respondents. In the said affidavit the deponent has denied that the notice is bad in law and reiterated that the assessee has not disclosed the material facts fully and truly that are necessary for the assessment and taken unaccounted cash into its books. Ther .....

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ring the course of business. The Petitioner had in fact taken loans from 45 parties and had supplied the particulars of these 45 parties to the Assessing Officer on or about 14th March, 2009. Mr.Pardiwalla pointed out that in Exhibit-B these particulars were provided and the annexure at page 30 of the petition was a list of loan confirmations which had been provided to the Assessing Officer for the period ending 31st March, 2007. We have perused the said letter and annexure and find that the ass .....

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the communication issued to the Petitioner by the Deputy Commissioner of Income Tax on 21st May, 2014 these items were claimed as unsecured loans but were actually unaccounted cash received through bogus loans and, therefore, the Deputy Commissioner concluded that there is reason to believe that income has escaped assessment in the hands of the assessee for the assessment year 2007-08 and, therefore, reopening of the assessment was necessary. The Deputy Commissioner also called upon the Petitio .....

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e also filed. The Revenue has contended that they were accommodation entries only on the basis of mere surmises and guesswork which amounted to a change of opinion. The Petitioner further contended that all necessary information had already been provided at the time of filing returns and therefore, there was no occasion for revenue to contend that it has failed to disclose all particulars. 8. On behalf of the revenue, Mrs. Bharucha submitted that all the four parties concerned had facilitated ac .....

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