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Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD
Before: SHRI RAJPAL YADAV & SHRI WASEEM AHMED
PER RAJPAL YADAV, VICE PRESIDENT :
The assessee is in appeal before the Tribunal against the order of learned Commissioner of Income-tax (Appeals)-3, Ahmedabad [“CIT(A)” in short] dated 24.01.2019 passed for Assessment Year 2011-12. 2. Originally the assessee has taken 4 grounds of appeal wherein he has challenged confirmation of addition of Rs.12,28,000/-. However, during the pendency of the appeal, the assessee has filed an application for permission to raise an additional ground of appeal. In the additional ground of appeal, the assessee has challenged reopening of the assessment. Since the additional ground of appeal goes to the root of the cause and substantially affect the rights of the assessee; therefore, in view of the judgment of Hon’ble Supreme Court in the case of National Thermal Power Co. Ltd. Vs AY : 2011-12 2
With the assistance of learned Representatives, we have gone through the record carefully. The assessee has filed his return of income which was selected for scrutiny assessment and an assessment order under Section 143(3) of the Income-tax Act, 1961 (“the Act” in short) was passed on 29.03.2014 determining the total income of Rs.64,98,700/-. The Assessing Officer thereafter reopened the assessment by issuance of notice under Section 148 of the Act on 21.03.2017. The Assessing Officer has reopened the assessment after recording the following reasons:-
“In this case, the assessee filed return of income for AY 2011-12 on 30.09.2011 declaring income 465310/-. The assessment u/s. 143(3) of the Act finalized on 09.03.2014 making addition of Rs.59,12,890/- and assesses income determined at Rs.64,98,700/-. Thereafter, the Revenue Audit has raised major audit objection for an amount of Rs. 12,28,000/- which resulted into tax effect of Rs. 516054/-plus interest.
Further, on verification of scrutiny records it reveals that the assessee had sold an immovable property for Rs.73,68,000 on 09/08/2010 which was purchased on 25/09/2007 at Rs. 1,76,000/-. In the meantime assessee has executed Bankhat on 23/08/2008 in favour of Shri Harish K. Shah for Rs.3,50,000/-. The value of property as per 50C as on date of Bankhat was Rs. 61,40,000/-. The AO has taken sales consideration at Rs. 61,40,000/- i.e., date of Bankhat. However, as per section 2(47) property is transfer on the date on which there is agreement with possession. The assessee as per Bankhat had not given possession to Shri Harish K. Shah. Hence, he was still the owner of the property and entire sales consideration of Rs. 73,68,000/- should have been taken into consideration for working out the Capital Cain.
I, therefore, have reason to believe that the income to the tune of Rs. 1.00 lac or more has escaped assessment within the meaning of section 149(1)(a) of the I.T. Act, 1961. I am therefore satisfied that this is a fit case to re-open the assessment u/s.147 of the I.T. Act, 1961. (D.G. PARMAR) Income-tax Officer, Ward 3(3)(3), Ahmedabad”
It is pertinent to note that the assessee has filed his return of income on 30.09.2011 and the assessment order was passed under Section 143(3) of Shri Nitin Ishwarbhai Patel Vs. ITO AY : 2011-12 3
the Act on 09.03.2014. The Assessing Officer has reopened this assessment order. The interdiction provided in the proviso appended to Section 147 puts an embargo upon the power of the Assessing Officer to reopen an assessment where scrutiny assessment was made under Section 143(3) of the Act and four years have passed from the end of the relevant assessment year. In such cases the assessment can be reopened only if there is a failure on the part of the assessee to make the return under Section 139 of the Act or in response to a notice issued under sub-section (1) of Section 142 or Section 148 of the Act or the assessee failed to disclose fully and truly all material facts necessary for his assessment for that assessment year. A perusal of the reasons extracted supra, it would nowhere reveal that which part the assessee failed to disclose fully and truly material facts for the assessment of his income in this assessment year. As observed above, a scrutiny assessment has taken place in this year and it is Assessment Year 2011-12 which is sought to be reopened on 21.03.2011 – meaning thereby 4 years have been expired from the end of Assessment Year 2011-12. The conditions enumerated in the provision appended in Section 147 are not available. The Assessing Officer has failed to point out this aspect in the reasons recorded by him. He simply reopened on the basis of an audit objection. Therefore, this reopening is not sustainable. We allow this ground of appeal and quash the reassessment order.
In the result, appeal of the assessee is allowed.
Order pronounced in the Court on 16th December 2021 at Ahmedabad. (WASEEM AHMED) VICE-PRESIDENT Ahmedabad, Dated 16/12/2021 *Bt AY : 2011-12 4
आदेश क" ""त"ल"प अ"े"षत/Copy of the Order forwarded to : 1. अपीलाथ" / The Appellant
""यथ" / The Respondent. 3. संबं"धत आयकर आयु"त / Concerned CIT 4. आयकर आयु"त ( अपील ) / The CIT(A)-
"वभागीय ""त"न"ध , आयकर अपील"य अ"धकरण , /DR,ITAT, Ahmedabad, 6. गाड" फाईल /Guard file.
आदेशानुसार/ BY ORDER,सहायक पंजीकार (Asstt.