OM PRAKASH DARUKA (HUF),RANIGANJ vs. ITO, WARD 3(1),, ASANSOL

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ITA 1175/KOL/2026Status: DisposedITAT Kolkata21 July 2026AY 2013-20146 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the reasons recorded for reopening the assessment were vague and scanty, lacking specific details of transactions. Following a coordinate bench decision, the Tribunal quashed the reopening and subsequent assessment.

What were the facts?

The Assessing Officer reopened the assessment for AY 2013-14 based on information from the investigation wing regarding accommodation entries for sale of shares. The AO made additions for unexplained money and expenses, which were confirmed by the CIT(A).

What were the issues?

The primary issue was the validity of the reopening of assessment under Section 147/148 due to vague and scanty reasons recorded by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 69A,Section 69C

AI-generated summary — verify with the full judgment below

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ORDER / आदेश

This is an appeal preferred by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-NFAC, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 05.01.2026 for the AY 2013-14. 2. The first issue raised by the assessee is against the reopening of assessment us/ 147 read with Section 148 of the Act on the ground that notice u/s 148 of the Act is bad in law and therefore all the subsequent proceedings in terms of said notice are also

2 I.T.A. No.1175/Kol/2026 Assessment Year: 2013-14 Om Prakash Daruka (HUF) invalid and bad in law. The Ld. AR also assailed the reasons recorded u/s 148(2) on the ground being vague and scanty and therefore the re-opening of assessment may be quashed.

3.

Facts in brief are that the assessee filed return of income on 23.07.2013 declaring total income of Rs. 2,202,430/- which was processed u/s 143(1) of the Act on 07.02.2014. Thereafter the AO on the basis of information received from investigation Wing, Kolkata reopened the case of the assessee u/s 147 by issuing notice u/s 148 on 5.2.2019 which was complied with by the assessee by filing return of income on 07.05.2019 disclosing the same income as declared in the original return of income. Thereafter a statutory notices along with questionnaire were issued which were duly complied with by the assessee. The AO finally made addition of Rs. 12,14,946/- in respect of sale of shares credited by the assessee as unexplained money u/s 69A of the Act. Besides the AO added towards @0.15% a sum of Rs. 1,822/- u/s 69C of the Act. The addition was confirmed by the ld. CIT(A) by upholding the order of Assessing Officer.

4.

At the outset, the Ld. AR pointed out that the re-opening of assessment has been done invalidly without recording correct reasons to believe. The ld. AR submitted that the resons recorded were very vague and scanty as there were no details of details of transactions done by the assessee,such as date of the transactions, person with whom the transactions were entered into and without mentioning the correct amounts involved. The ld. AR therefore submitted that reasons recorded are vague and scanty and thus the re-opening on the such incomplete reasons is bad in law. The ld. AR referred to the decision of Co-ordinate Bench of Kolkata in the case of Anju Daruka vs. ITO in [2025] 173 taxmann.com 91 (Kolkata-trib) wherein exactly same reasons were recorded with variances in the amounts only and the coordinate bench has quashed the assessment by relying on the decision of CIT Vs Insecticides (India) Ltd (2013) 357 ITR 330(Delhi). The ld. AR therefore prayed that the re-opening of assessment and consequent assessment may be quashed as bad in law and nullity.

3 I.T.A. No.1175/Kol/2026 Assessment Year: 2013-14 Om Prakash Daruka (HUF) 5. The Ld. DR relied heavily on the order of lower authorities below.

6.

We have heard the rival contentions and perused the material on record. We find that the case of the assessee has reopened by the AO u/s147 by issuing notice u/s 148 after recording a reason u/s 148(2) which is vague and scanty. The said reason are extracted below for ready reference:

4 I.T.A. No.1175/Kol/2026 Assessment Year: 2013-14 Om Prakash Daruka (HUF) 7. A perusal of the above reasons reveals that the reasons recorded are vague , sa=canty and unequivocal as the details of transactions , amounts involved and with whom these were done are not given. In our opinion the said reasons are not enough to re-open the case. We have also carefully perused the decision of Co-ordinate Bench in the case of Anju Daruka (supra) wherein the same reasons were recorded as in thje case of assessee and the re-opening of assessment was struck down.Therefore the issue is squarely covered by the decision of co-ordinate bench wherein the reopening of assessment made on the basis of vague and scanty reasons is held to be bad in law and so the assessment is framed. For the sake of ready reference the relevant portion of the said order is extracted below:

8.

We have heard the rival contentions and perused the materials available on record. The undisputed facts are that the case of the assessee was reopened u/s 147 read with section 148 of the Act after recording reason to believe u/s 148(2) of the Act by the AO. The above reopening was done after the ld. AO received information from the DIT (Investigation) Kolkata that assessee is beneficiary of accommodation entries in the form Long Term Capital Gain. The reasons recorded are available at page no. 42 of the paper book, which has been challenged by the assessee to be vague, scanty and ambiguous. For the sake of ready reference same is extracted below:- “(i) The assessee has filed its return of income for the Assessment Year 201314 disclosding total income of Rs.2.02,150/- on 23/07/2013. During the A.Y.2013-14 the assessee has disclosed income from business & profession amount to Rs.2,55,874/- and from other sources at Rs.58,578/-and deduction under Chapter VIA of Rs.1,12,305/-. The assessee has filed its return of Income for the assessment year 2014-15 and 2015-16 disclosing total income of Rs.2,17,940/- and Rs.4,86,060/- respectively. The return of income for the A.Y.2013-14 was duly processed on 18/12/2013 at total income of Rs.2,02,150/- resulting NIL Demand/Refund.

(ii) Survey actions were conducted by the DIT (Investigation), Kolkata on various share brokers during which the share brokers have accepted their role in the entire scheme of providing accommodation entries of bogus LTCG/STCG in case of penny stock "BSR Finance & Construction Limited." (iii) From the in-depth analysis of the return filed by the assessee for the A.Y.2013-14, Investigation reports, statements of the share brokers involved, the exist providers, related shell companies, sham transactions along with statement of related persons in the scheme it emerges that the assessee has taken accommodation entry of pre-arranged bogus LTCG of around to Rs.11,87,522/- during the F.Y.2012-13 in the scrip of "BSR FINANCE & CONSTRUCTION LIMITED." (iv) Show cause notice for initiation of proceedings u/s 147 was issued on 15/10/2018 for necessary compliance on or before 15/11/2018, but the assessee has failed to comply with the show cause notice. Page | 7 ITA No.2143/KOL/2024 Anju Daruka; A.Y. 2013-14

5 I.T.A. No.1175/Kol/2026 Assessment Year: 2013-14 Om Prakash Daruka (HUF) (v) On examination of the Return of Income filed by the assessee, it is found that the assessee has disclosed income from business & profession amount to Rs.2,55,874/- and income from other sources amount to Rs.58,578/-in its return of income for the A.Y.2013-14. It is evident from the records that the assessee had claimed exempt income amount to Rs.11,87,522/- for LTCG In its ITR (Schedule El) filed for the A.Y.2013-14. (vi) On the basis of above discussion, I have every reason to believe that the income chargeable to tax has escaped assessment to the extent of Rs.11,87,522/-, coming within the meaning of section 147 read with proviso thereto, by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. As the time limit for issue of notice as provided u/s 149(b)(iii) is expiring on 31.03.2020, your honour is requested to sanction permission u/s 151 read with proviso thereto to issue notice u/s 148 of the Income Tax Act, 1961 for the A.Y.2013-14.” 8. As apparent from the above, the Co-ordinate Bench has followed the decision of Hon’ble Delhi High Court in the case of CIT Vs Insecticides (India) Ltd (2013) 357 ITR 330(Delhi).

9.

Since the facts of the case are substantially same to the facts as decided by the Co-ordinate bench by following two decisions of Hon’ble Delhi High court(supra), we therefore respectfully following the same set aside the order of Ld. CIT(A) and direct the AO to delete the same.

7.

In the result, the appeal of the assessee is allowed. Order is pronounced in the open court on 21st July, 2026. Sd/- (Rajesh Kumar/राजेश कुमार) Accountant Member/लेखा   �è� Dated: 21st July, 2026 SM, Sr. PS

6 I.T.A. No.1175/Kol/2026 Assessment Year: 2013-14 Om Prakash Daruka (HUF) Copy of the order forwarded to: 1. Appellant- Om Prakash Daruka(HUF), C/O, S.N. Ghosh & Associates, Advocates, 2, Garstin Place, 2nd Floor, Suite NO. 203, Off Hare Street, Kolkata-700001 2. Respondent – ITO, Ward-3(1), Asansol 3. Ld. CIT(A)- NFAC, Delhi 4. Ld. Pr. CIT- , Kolkata 5. DR, Kolkata Benches, Kolkata

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