TMI Blog2019 (5) TMI 775X X X X Extracts X X X X X X X X Extracts X X X X ..... outset because the AO has not recorded any reasons after applying his mind nor supplied the copy thereof to the assessee and as such, in these circumstances, question of filing / disposing off the objections by assessee/AO does not arise. As decided in Pr.CIT-16 vs. Jagat Talkies Distributors [ 2017 (9) TMI 192 - DELHI HIGH COURT] wherein GKN Driveshaft (India) Ltd. [ 2002 (11) TMI 7 - SUPREME COURT] discussed held that when the assessee has not been given copy of reasons recorded for issuance of notice u/s 148 by the AO, entire assessment proceedings and resultant assessment order passed u/s 143(3)/148 was to be quashed. - Decided in favour of assessee. - ITA No.389/Del./2019 - - - Dated:- 8-5-2019 - Shri R.K. Panda, Accountant Member And Shri Kuldip Singh, Judicial Member For the ASSESSEE : Shri Saubhagya Aggarwal, Advocate, Shri Kunal Jangid, Advocate And Shri Sumit Baskar, Advocate For the REVENUE : Ms. Ashima Neb, Senior DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : The Appellant, M/s. DS Doors (India) Ltd. (hereinafter referred to as the assessee ) by filing the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remium and relied upon the material supplied by the DCIT, Central Circle 2(2), Mumbai to believe that there was an escapement of tax. AO, after declining the contentions raised by the assessee, reached the conclusion that when it stands proved that the purported investor company was only dealing in providing accommodation entries to various beneficiaries, share premium of ₹ 25,00,000/- received by the assessee company is found to be ingenuine transaction and thereby made an addition of ₹ 25,00,000/- u/s 68 of the Act. 3. Assessee carried the matter by way of an appeal before the ld. CIT (A) who has confirmed the addition by dismissing the appeal. Feeling aggrieved, the assessee has come up before the Tribunal by way of filing the present appeal. 4. We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 5. Ld. AR for the assessee challenging the impugned order contended that AO as well as CIT (A) have erred in passing/ confirming the assessment order as AO ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the parties to the appeal and case laws relied upon, the sole question arises for determination in this case is :- as to whether reassessment order passed by the AO u/s 143(3)/147, confirmed by the ld. CIT (A), is liable to be quashed on the ground that no reasons have been recorded before reopening nor the copy thereof has been supplied to the assessee despite demand? 9. When we examine the question framed in the light of the undisputed facts that reasons recorded , if any, has never been supplied to the assessee by the AO despite demand vide letter dated 04.04.2017, available at page 6 of the paper book, it becomes clear that reasons recorded, if any, have not seen the light of the day. 10. Ld. DR for the Revenue has impliedly admitted that reasons recorded have not been supplied to the assessee as she has relied upon noting sheet dated 24.07.2017 recorded by the AO, available at page 15 of the synopsis filed by the ld. DR, showing that reasons recorded were confronted to the assessee. But we fail to understand if the noting sheet dated 24.07.2017 relied upon by the ld. DR is qua confronting the reasons recorded to the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the Assessing Officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the abovesaid five assessment years. 14. Ld. DR for the Revenue by relying upon the decision rendered by Hon ble Apex Court in the case of Home Finders Housing Ltd. vs. ITO (2018) 94 taxmann.com 84 (SC) dismissing the SLP filed by the assessee contended that non-compliance of the procedure laid down by the Hon ble Supreme Court in M/s. GKN Driveshaft India Ltd. (supra) would not make the order void and non est and such a violation was a procedural irregularity which could be cured by remitting the matter to the authority. Operative part of the decision rendered by Hon ble Supreme Court in Home Finders Housing Ltd. vs. ITO (supra) is extracted for ready perusal as under :- Section 148, read with section 147, of the Income-tax Act, 1961 - Income escaping assessment - Issue of notice for (General) - Assessing Officer noticed that income chargeable to tax had esca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns by assessee/AO does not arise. 18. Hon ble jurisdictional High Court in case cited as Pr.CIT-16 vs. Jagat Talkies Distributors (2017) 85 taxmann.com 189 (Delhi) wherein GKN Driveshaft (India) Ltd. (supra) and other case laws discussed held that when the assessee has not been given copy of reasons recorded for issuance of notice u/s 148 by the AO, entire assessment proceedings and resultant assessment order passed u/s 143(3)/148 was to be quashed. 19. In view of what has been discussed above, we are of the considered view that the case law relied upon by the ld. DR is not applicable to the facts and circumstances of the case. Since the AO has failed to record the reasons after being satisfied that the income has escaped assessment, which he has not supplied to the assessee despite demand the initiation of reassessment proceedings at the very outset were void and non est and as such, consequent assessment order passed by the AO is liable to be quashed without going into the merits of this case, hence hereby quashed. Resultantly, the appeal filed by the assessee is hereby allowed. Order pronounced in open court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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