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2015 (11) TMI 1523 - ITAT DELHI

2015 (11) TMI 1523 - ITAT DELHI - TMI - Reopening of assessment - reasons to believe - Held that:- No fresh material is brought by the Revenue on record but the assessment has been reopened on the basis of the return of income and the documents submitted alongwith the return of income. Therefore reopening of assessment is not valid. Hence, the same is quashed and accordingly, the assessment order passed in pursuance of the notice issued under section 148 is also quashed. Also see CIT vs. Orient .....

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reassessment order passed u/s. 147 r.w.s. 143(3) are illegal, bad in law and without jurisdiction. 3. The brief facts of the case are that in this case it was gathered by the AO that the assessee had claimed interest of ₹ 1,48,307/- as expenditure in the return originally filed on 27.8.2009. However, the same did not relate to business activities and as such expenditure claimed at ₹ 1,48,307/- was not allowable as per Act. Based on such inference, the AO initiated action u/s. 147 by .....

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2014 has dismissed the Appeal of the assessee. 5. Now the Assessee is in appeal before the Tribunal. 6. At the time of hearing Ld. Counsel for the assesse stated that the assessee has raised 16 grounds of appeal out of which the Assessee has challenged the ground challenging the Notice u/s. 148 of the I.T. Act and the reassessment order passed u/s. 147 read with section 143(3) of the I.T. Act as well as the additions made by the AO and confirmed by the Ld. CIT(A on merits also. He further stated .....

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out of borrowed capital the substantial funds are invested in no business assets. Therefore, the deduction u/s. 36(1)(iii) of the Act is required to be restricted to the borrowed funds invested in the business assets. Ld. Counsel for the assessee stated that AO has recorded his reasons dated 7.4.2011 for issuing of notice u/s. 147 of the I.T. Act on the same reasons mentioned in the Notice, but no fresh material was available with the AO, except the material already filed by the assessee with t .....

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pages 1 to 59. 7. Ld. DR relied upon the orders of the authorities below and requested that the appeal of the Assessee may be dismissed. 8. I have heard both the parties and perused the relevant records, especially the orders of the authorities below. No doubt that the assessee has raised 16 ground in his appeal, but at the time of hearing before me, he mainly argued the ground No. 1 in which he has challenged the notice issued u/s. 148 of the I.T. Act and reassessment proceedings. As argued by .....

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ds invested in the business assets. For the sake of convenience, the contents of the notice dated 24.1.2011 issued by the AO u/s. 147 of the I.T. Act, 1961 as well as the reasons recorded by the AO u/s. 147 of the I.T. Act, 1961 dated 7.4.2011 are reproduced as under:- F.No. ACFPB7654J/W-1(1)MZR/10-11 Office of the Income Tax Officer Ward 1(1), Muzaffarnagar Dated : 24.1.2011 To Sh. Rakesh Bandhu, 212, South Civil Lines, Muzzafarnagar Sub:- Notice u/s. 147 of the I.T. Act, 1961 for the AY 2009-1 .....

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t be issued to assess the escaped income. Sd/- (V.K. NIGAM) INCOME TAX OFFICER WARD 1(1), MUZAFARNAGAR REASONS RECORDED OFFICE OF THE INCOME TAX OFFICER, WARD 1(1), MUZAFFARNAGAR 1. Name & address of the assessee Shri Rakesh Bandhu 1-Mandi Kohna, Sarafa Bazar, Muzafarnagar 2. PAN/GIR No. ACFPB7654J 3. Status Individual 4. Assessment year 2009-2010 REASONS UNDER SECTION 147 OF THE I.T. ACT, 1961 07.4.2011 The assessee filed return on 27-08-2009 vide R. R. No.1568 declaring income of ₹ 1 .....

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)(iii) of the Income Tax Act, 1961 is required to be restricted to the borrowed funds invested in the business income 2. The assessee sought time on 03-02-2011, 23-02-2011, 04-03-2011 and 22-03-2011. However, till date no reply has been received. Moreover after issue of notice under section 148 of the Income Tax Act, 1961 the assessee shall have opportunity to explain his case in the course of settlement of objections to the notice under section 148. Therefore, on the basis of facts mentioned in .....

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CIT vs. Atul Kumar Swami 362 ITR 693 (Delhi), I find that the in one of the decisions i.e. in the case of CIT vs. Orient Craft Ltd. (Supra), the Hon ble has held as under (Head Notes):- Held, dismissing the appeal, that the reasons disclosed that the Assessing Officer reached the belief that there was escapement of income on going through the return of income filed by the assessee after he accepted the return under section 143(1) without scrutiny, and nothing more. This was nothing but a review .....

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