TMI Blog2022 (11) TMI 1209X X X X Extracts X X X X X X X X Extracts X X X X ..... fact and non-application of mind by the ld. AO could be held to be valid. No infirmity in ld. CIT(A) quashing the re-assessment proceedings. Hence, the ground raised by the Revenue challenging the validity of quashing the re-assessment is dismissed. - ITA No.2253/Mum/2022 And CO No.130/Mum/2022 (Arising out of ITA No.2253/Mum/2022) - - - Dated:- 25-11-2022 - Shri M.Balaganesh, Accountant Member And Smt Kavitha Rajagopal, Judicial Member For the Assessee : Shri K. Shivaram For the Revenue : Ms. Sujata Iyengar ORDER PER BENCH: This appeal in ITA No. 2253/Mum/2022 CO No.130/Mum/2022 for A.Y.2011-12 arises out of the order by the ld. Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (NFAC) in appeal No.CIT(A)-32, Mumbai/10647/2017-18 dated 27/07/2022 (ld. CIT(A) in short) against the order of assessment passed u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 28/12/2017 by the ld. Income Tax Officer 23(1)(3), Mumbai (hereinafter referred to as ld. AO). 2. Let us take up the Revenue appeal First. 2.1. The Revenue has raised the following grounds of appeal:- 1 Whether on the facts an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn has been filed by the assessee, the ld. AO observed that income of the assessee had escaped assessment and sought to reopen the same by issuance of notice u/s.148 of the Act on 31/03/2017 after recording the reasons. The reasons recorded by the ld. AO are as under:- Sir/Madam Subject- Re-assessment proceedings in your case for A.Y. 2011-12-reg. Ref: Your representative letter dated 24.11.2017 Please refer to the above. Vide this office letter dated 28.09.2017, the reasons for re-opening was intimated as under- As per the ITS/AIR/CIB information available with the income tax department, during the year under consideration, the assessee had purchased immovable property for Rs. 2,13,61,851/- on 19.01.2011 i.e. during the F.Y. 2010-11.on verification of the ITD system it is seen that the assessee has not filed the return of income for A.Y. 2011-12 Income of Rs. 2,13,61,851/- chargeable to tax in the hands of the assessee has escaped assessment within the meaning of the provisions of section 147 (b) of the Act, for failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for A.Y. 2011-12. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation available with the Income tax department, during the year under consideration, the assessee had purchased immovable property for Rs. 2,13,61,851/- on 19.01.2011 le during the F.Y. 2010-11. On verification of the ITD System it is seen that the assessee has not filed the return of income for A.Y. 2011-12..... Income of Rs. 2,13,61,851/- chargeable to tax in the hands of the assessee has escaped assessment within the meaning of the provisions of section 147(b) of the Act, for failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for A.Y. 2011-12. 3.2 The appellant has objected to the reasons for reopening vide his letter dated 25.10.2017. He has submitted that there are no provision in ITR-2 to disclose relevant details in respect of purchase of property. He has also informed the AO that property has been purchased jointly with his wife Mrs. Sarojben C Mehta. No action has been taken in the case of wife of appellant after inquiry by the department. The AO disposed off the objections vide his letter dated 27.10.2017. The objections were disposed of summarily without dealing with the main issues raised by the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssumption that assessee had not filed his return of income for A.Y.2011-12. Factually, the return of income was already filed by the assessee on 21/07/2011. Moreover, there was a letter dated 25/07/2015 issued by the ld. AO to the assessee for A.Y.2010-11 calling for reasons for not filing income tax return for A.Y.2010-11. This letter is enclosed in page 13 of the paper book. In response to the said letter, the assessee s representative had vide letter dated 03/08/2015 had addressed to the ld. AO stating that assessee is a senior citizen aged about 83 years old and had filed his income tax returns from A.Y.2011-12 onwards and had enclosed the copy of ITR acknowledgement thereon. This letter is enclosed in page 14 of the paper book. We find that the ld. AO had referred to the aforesaid two letters in the reasons recorded stating the same as the reason to conclude that assessee had not filed return of income for A.Y.2011-12. This fact is evident from the reasons recorded reproduced supra. Factually, the notice dated 25/07/2015 was issued by the ld. AO for A.Y.2010-11 calling for income tax return from the assessee. The reply letter dated 03/08/2015 from the assessee to the ld. AO cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... September, 2012 declaring total loss of Rs.4,21,11,382/- and the same was processed by the C.P.C. .......It is pertinent to mention here that in this case the assessee had filed return of income for the year under consideration but no assessment as stipulated under Section 2(40) of the Act was made and the return of income was only processed under Section 143(1) of the Act. In view of the above, provisions of clause (b) of explanation 2 to section 147 are applicable to facts of this case and the assessment year under consideration is deemed to be a case where income chargeable to tax has escaped assessment . 5. The fact is the return of income for A.Y. 2012-13 filed by petitioner on 24th September, 2012 has been assessed under Section 143(3) of the Act and the Assessment Order dated 31st March, 2015 has been passed. Therefore, the Assessing Officer has proceeded on erroneous factual basis that the return of income was only processed under Section 143(1) of the Act. That displays total non application of mind. In fact, petitioner's allegations that Respondent No.1 has sought to re-open the assessment on incorrect factual position that the return of income was only processe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2019, Ex. K herein passed by the Respondent and also the Notice/summons dated 22.10.2019, Ex. L herein issued by the Respondent. 9. Petition disposed. 3.3. Similarly, the Hon ble Delhi High Court in the case of Deepak Wadhwa vs. ACIT reported in 435 ITR 699 had also occasion to consider the similar issue wherein it was observed as under:- 5.2. As far as the other aspect is concerned, in our view, since the proof put in place by the petitioner-assessee with regard to the acknowledgment of return filed for the assessment year 2011-12 has not been disputed by the Revenue, as noticed above, the challenge to the impugned notice and the impugned order will have to be sustained. 61 Therefore, for the foregoing reasons, we are inclined to quash the impugned notice dated March 27, 2018 as also the impugned order dated September 28, 2018. It is ordered accordingly. 3.4. Similar view was taken by the Hon ble Gujarat High Court in the case of Mumtaz Haji Mohamad Menon vs ITO reported in 408 ITR 268 wherein it was held as under:- In this context, we have noted that the reasons proceeded on two fun- damental grounds. One, that the property in question was sold for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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