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TMI Blog2024 (11) TMI 1257X X X X Extracts X X X X X X X X Extracts X X X X ..... dings u/s 147 of the Act is bad in law 1.1 The Learned CIT(A)/NFAC erred in confirming reopening of the assessment under Section 147 of the Act and as such, the reassessment order passed is bad in law and ought to be quashed. 1.2 The Learned CIT(A)NFAC erred in confirming reopening of assessment without appreciating that reopening was done on the basis of wrong fact i.e. the transaction between Appellant and Mint Agro Tech Pvt Ltd. was not recorded in the books of accounts by the Appellant whereas the fact was that the said transaction was duly recorded by the Appellant in its books and thus the reason to believe of the AO as well as the sanction u/s 151 was granted on wrong facts and hence reopening is bad in law. 1.3 On the facts and in the circumstances of the case and in law, the Learned CIT(A)/NFAC has erred in not considering that the additions of INR 5,30,00,000/- was made by the Learned Assessing Officer ("Learned AO") merely on the basis of information received from the DDIT (Inv.), Unit-S(1), New Delhi i.e. without any independent application of mind, and hence reopening is bad in law. 1.4 The Learned CIT(A)/NFAC has failed to appreciate that re-assessment was bey ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /NFAC and Learned AO erred in not providing any documentation/ statement recorded against the Appellant and, also in not granting any opportunity to cross examine any statement recorded by the alleged party against the Appellant, which is in violation of principles of natural justice and liable to be quashed. Ground No. 4 4.1 Without prejudice to the above, the Learned CIT(A)/NFAC has failed to appreciate the fact that the amount of transactions highlighted in the assessment order aggregated to only INR 3,50,00,000/- however the Learned AO has made addition of INR 5,30,00,000/- which seems arbitrary and without any basis. 4.2 Without prejudice to the above, the Learned CIT(A) has failed to appreciate the fact that the amount of transaction highlighted in the 'reason to believe aggregated to only INR 5.05,00,000/-however Learned AO has made addition of INR 5,30,00,000/- which seems arbitrary and without any basis. Ground No 5: General 5. The Appellant craves leave to amend or alter any of the above grounds or add a new ground, if and when necessary." 3. The brief facts of the case are that for the year under consideration, the assessee filed its return of income on 30 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee in the bank account of the company, M/s Mint Agro Tech Pvt. Ltd., for claiming purchase expenses is nothing but a coloured transaction which has been entered into by the assessee with the intention to inflate the expenses. As a result, the AO held that the amount of INR 5,30,00,000 as an unexplained expenditure in the books of the assessee in terms of the provisions of section 69C of the Act. 4. The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee and upheld the addition of INR 5,30,00,000 made under section 69C of the Act. The relevant findings of the learned CIT(A), vide impugned order, are reproduced as follows: - "Analysis and Findings: The reassessment was based on specific information from the DDIT (Inv.)-5(1), Delhi, indicating non-genuine transactions with Mint Agro Tech Pvt. Ltd. The appellant's contention that these transactions were recorded in their books of accounts does not suffice to nullify the reopening. The information received from the DDIT provided a reasonable basis for reopening the assessment, and the AO followed due procedure by recording reasons and obtaining necessary approvals before issuing the not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , it is evident that the reassessment was conducted following due process and based on reasonable grounds. The appellant's arguments regarding the violation of natural justice and inadequate opportunity are not substantiated by the records. The AO's findings of non-genuine transactions and the consequent addition under section 69C are supported by the evidence and the inconsistencies in the appellant's documentation. The addition of Rs. 5,30,00,000 made under section 69C is upheld. The appeal filed by assessee is dismissed." 5. We have considered the submissions of both sides and perused the material available on record. In the present case, on the basis of the information received from the DDIT(Inv.)-5(1), Delhi regarding certain transactions as appearing in the bank account of M/s Mint Agro Tech Pvt. Ltd. with the assessee, proceedings under section 147 of the Act were initiated and notice under section 148 of the Act was issued. It is evident from the record that during the assessment proceedings, the AO sought various details from the assessee regarding the purchase transaction with M/s Mint Agro Tech Pvt. Ltd., however, finding the bills to be non-genuine on the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etailed documents, as noted above, submitted by the assessee during the assessment proceedings. Having carefully perused all the details filed by the assessee during the assessment proceedings, which form part of the record, we are of the considered view that the assessee has duly explained the nature of transactions of purchase made from M/s Mint Agro Tech Pvt. Ltd. during the year under consideration. Accordingly, we are of the considered view that the addition made by the AO and upheld by the learned CIT(A) is unsustainable, and thus the same is directed to be deleted. As a result, the impugned order on this issue is set aside and ground no.2 raised by the assessee is allowed. 7. During the hearing, the learned AR submitted that if the relief is granted to the assessee on merits, then he may not wish to press the grounds challenging the reopening of the assessment at this stage. Since we have already deleted the addition made under section 69C of the Act in the present case, therefore ground no.1 raised by the assessee challenging the reopening of the assessment is left open. 8. In view of our aforesaid findings, grounds no.3 and 4 need no separate adjudication. 9. In the res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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