TMI Blog2022 (9) TMI 519X X X X Extracts X X X X X X X X Extracts X X X X ..... o section 147 of the Act are not satisfied in the present case. Thus, the reassessment proceedings under section 147 of the Act, in the present case, are set aside being bad in law. Accordingly, the impugned order passed by the learned CIT(A), inter-alia, upholding the order passed under section 143(3) r.w.s. 147 of the Act is set aside. As a result, ground No. 1 raised in assessee's appeal is allowed. - ITA No.574/Mum./2021 - - - Dated:- 9-9-2022 - Shri S. Rifaur Rahman, Accountant Member And Shri Sandeep Singh Karhail, Judicial Member For the Assessee : Shri Piyush Chhajed a/w Shri Sumit Mantri For the Revenue : Shri Mehul Jain ORDER PER SANDEEP SINGH KARHAIL, J.M. The present appeal has been filed by the assessee challenging the impugned order dated 17/03/2021, passed under section 250 of the Income Tax Act, 1961 ( the Act ) by learned Commissioner of Income Tax (Appeals) 54, Mumbai, [ learned CIT(A) ], for the assessment year 2012 13. 2. In its appeal, the assessee has raised following grounds: 1. On the facts and the circumstances of the case, the learned Assessing Officer erred in reopening the assessment under section 147 when no inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me/loss already determined during the scrutiny assessment proceedings under section 143 (3) of the Act. 5. Thereafter, on 27/03/2019, notice under section 148 of the Act was issued and reassessment proceedings in the case of the assessee were initiated on the basis of information received from DDIT (Investigation), Kolkata regarding certain paper/shell companies i.e. Silverson Logistics Private Ltd and Kalyani Vincom Private Ltd, whose bank accounts were alleged to have been used merely for transaction of layering of funds and assessee being one of the beneficiaries of such a transaction. Accordingly, the Assessing Officer was of the view that income totalling to Rs. 9,81,60,144 has escaped assessment, as assessee has failed to disclose truly and fully material facts. The assessee filed detailed objections against reopening of assessment, which were disposed off vide order dated 10/11/2019. The Assessing Officer issued notice under section 142(1) of the Act seeking information about the aforesaid two entities. In reply thereto, assessee provided the information regarding Silverson Logistics Private Ltd. In respect of Kalyani Vincom Private Ltd, assessee submitted that it has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer vide notices issued under section 143(2) of the Act. After considering of the submissions filed by the assessee, in pursuant of aforesaid notices, assessment order under section 143(3) of the Act was passed by the Assessing Officer after making disallowance under section 14A read with rule 8D. Similarly, order under section 153C r/w section 143 (3) of the Act was passed. However, after the expiry of 4 years from the end of the relevant assessment year, notice under section 148 of the Act was issued on 27/03/2019 alleging that income chargeable to tax has escaped assessment. While initiating the reassessment proceedings, the Assessing Officer recorded following reasons for reopening the assessment: Reason for re opening of the assessment u/s 147 of the Income Tax Act, 1961 As per the PAN database in the ITD System, the jurisdiction over the present assessee is lying with this charge. The assessee had filed its return of income on 30.09.2012, declaring net loss at Rs.21,79,30,180/ . The assessment was carried out u/s. 143(3) on 28.03.2015, assessing the net loss at Rs.21,32,43,006/-. Subsequent to search action in the cases of Arshiya Group, the assessment was comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In view of these facts, I have reason to believe that the income amounting to Rs.5,54,21,934/- chargeable to tax has escaped assessment within the meaning of Section 147 of the Income Tax Act, 1961. 3. Further, vide letter dated 28.02.2019, the DDIT (Inv.), Unit 2(2), Kolkata, has intimated that on perusal and analysis of the Bank Statement of Kalyani Vincom Private Limited [AADCK9645D] and the other inter-linked companies, it was noted that the said accounts were being frequently credited followed by immediate transfer of funds to various parties. It was further observed by the Investigation Wing that Santu Maity is a common Director in Kalyani Vincom Private Limited, Shivbhumi Tradelink Private Limited and Time Dealcom Private Limited and 42 other companies. Further, it has been informed that Kalyani Vincom Private Limited, Shivbhumi Tradelink Private Limited and Time Dealcom Private Limited are under the process of striking off with the RoC. As per the database of shell / paper / Jamakharchi companies, all the above stated companies are controlled and managed by an entry operator, Shri Praveen Agarwal and that the dummy directors in those companies and the inter-linked com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with entities viz. Silverson Logistics Private Ltd and Kalyani Vincom Private Ltd and since the assessee has failed to disclose truly and fully all material facts, therefore, income chargeable to tax has escaped assessment within the meaning of section 147 of the Act. 10. Before proceeding further, it is relevant to analyse the provisions of 1st proviso to section 147 of the Act, as it stood prior to its substitution by Finance Act 2021, which reads as under: Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year: 11. Thus, as per 1st proviso to section 147 of the Act, in a case where assessment was completed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nancial year. We find that as required, assessee also separately provided details of debtors, including in the case of Silverson Logistics Private Ltd, outstanding for more than 3 years, forming part of the paper book at page No. 9 12, wherein the assessee has specifically mentioned that the amount of Rs. 2,43,24,868 is due from Silverson Logistics Private Ltd since financial year 2010 11. We find that no further detail was sought by the Assessing Officer in this regard and after considering of the details as sought, from time to time, assessment order under section 143 (3) of the Act was passed by the Assessing Officer. 13. Further, in respect of alleged transactions with Kalyani Vincom Private Ltd, it has been the submission of the assessee that the assessee has not entered into any transaction with the said entity. From page No. 7 of the assessment order passed under section 143 (3) r/w section 147 of the Act, it is evident that Assessing Officer, while disposing of the objection against initiation of reassessment proceedings, agreed with the aforesaid submission of the assessee and observed as under: Further as response submitted by the assessee that they have not e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer, in the event of challenge to the reasons, must be able to justify the same based on material available on record. He must disclose in the reasons as to which fact or material was not disclosed by the assessee fully and truly necessary for assessment of that assessment year, so as to establish vital link between the reasons and evidence. That vital link is the safeguard against arbitrary reopening of the concluded assessment. The reasons recorded by the Assessing Officer cannot be supplemented by filing affidavit or making oral submission, otherwise, the reasons which were lacking in the material particulars would get supplemented, by the time the matter reaches to the Court, on the strength of affidavit or oral submissions advanced. 15. We find that even in respect of Highland Transport Private Ltd and Neelanchal Roadways Private Limited, the assessee provided the details of same amount due from them in its reply to notice issued under section 142(1) of the Act, during the course of scrutiny assessment proceedings. The assessee also submitted that the amount is due from financial year 2010 11 and the same was paid by these entities in the relevant financial year. As n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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