TMI Blog2022 (7) TMI 631X X X X Extracts X X X X X X X X Extracts X X X X ..... suspicion would not support the allegation. AO has not brought any evidence to prove the correctness of allegation that the assessee procured profit in the present case. In light of the binding precedents on this issue in the case of Sarthak Securities Co.Pvt.Ltd. [ 2010 (10) TMI 92 - DELHI HIGH COURT] re-opening of the assessment cannot be sustained in the present case. Since the re-opening of assessment is based upon purely on guess work hence, cannot be sustained - therefore, hold that the reasons recorded by the AO do not conform to law as there is a gross non-application of mind. Hence, the impugned order is hereby quashed. - Decided in favour of assessee. - ITA No. 6682/Del/2019 - - - Dated:- 13-7-2022 - SHRI KUL BHARAT , JUD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case. 6. Action of the CIT(A) in confirming the action of A.O. in making an Addition u/s 69 of I. T. Act 1961 of Rs. 40,000/- being commission on share capital raised is unjust, illegal, arbitrary, against the facts and circumstances of the case. 7. Action of the C1T(A) in confirming the action of A. O. in Charging of Interest u/s 234B of I. T. Act 1961 of Rs. 14,27,178/- on assessed income as against on the returned income is unjust, illegal, arbitrary and against the facts and circumstances of the case. FACTS OF THE CASE 2. Facts giving rise to the present appeal are that in this case, the assessee company was incorporated on 28.12.2007. The assessee company filed return of income for the year under appeal on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er would demonstrate that re-opening of the assessment is bad in law. He contended that the facts and transactions as recorded in the reasons do not pertain to the assessee. He further submitted that there is complete non-application of mind by the AO and there are series of discrepancies and errors into the reasons so recorded. He submitted that it appears that the facts related to any other party has been interpolated as the reasons of the assessee. He drew my attention to the reasons recorded by the AO wherein the AO has recorded that he had reasoned to believe that income exceeding Rs.1,00,000/- escaped assessment in the case of Rajlaxmi Commodities Pvt. Ltd., for the AY 2011-12 within the meaning of section 147/148 of the Act. He submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that in the case of the assessee income chargeable to tax has escaped assessment. Therefore, he submitted that the proceedings are validly upheld by the Ld.CIT(A) and the ground of appeal deserves to be rejected. 8. In rejoinder, Ld. Counsel for the assessee submitted that it is not the case merely a typographical error even the AO has not rectified the error if it was so. It is the case of bare non-application of mind and the facts of a different entity have been recorded and considered. Furthermore, even the assessment itself is bad in law on account of the fact that assessment is made on contradictory basis. In support of this, the Ld. Counsel for the assessee relied upon various case laws. He submitted that entire addition is made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. It is sated by the assessee company that in para 2.2 of the reasons recorded I have reason to believe cat income of exceeding Rs. 1 lakhs has escaped assessment in case of M/s. Rajlaxmi Commodities Pvt. Ltd for the A.Y. 2011-12 within the meaning of Section 147/148 of the Income Tax Act, 1961. It is submitted that assessee in not Raj Laxmi Commodities Pvt. Ltd. But Rajlaxmi Porfolio Private Limited whose income you have not alleged to escape assessment. The assessee company have submitted that SUCCEEDING ASSESSING OFFICER CANNOT IMPROVE UPON THE REASONS WHICH WERE ORIGINALLY COMMUNICATED TO THE ASSESSEE. This contention of the assessee has already been responded while disposing off objection that it was only a typing mistake only at one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce the re-opening of assessment is based upon purely on guess work hence, cannot be sustained. I therefore, hold that the reasons recorded by the AO do not conform to law as there is a gross non-application of mind. Hence, the impugned order is hereby quashed. Thus, Ground Nos. 1 2 raised by the assessee are allowed. 11. Ground Nos.3 to 6 are on merit of additions and Ground No.7 is against charging of interest. 12. Since the assessment has been quashed on the basis that the reason recorded for re-opening by the AO was found to be based on incorrect facts, therefore, the issues related to merit of additions do not need separate adjudication. Therefore, Ground Nos. 3 to 7 have become of academic interest only. 13. In the result, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
