JAIN TEXTILE INDUSTRIES,GURGAON vs. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-1(1), GURGAON, GURGAON

ITA 6585/DEL/2026Status: DisposedITAT Delhi29 September 2026AY 2013-146 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the reopening of assessment under Section 147 was invalid. The AO initiated the reopening on March 28, 2021, which was beyond four years from the end of Assessment Year 2013-14. The AO's reasons for reopening were based on the assessee reducing excise duty from sales, which the AO claimed constituted a failure to disclose material facts fully and truly. However, the Tribunal noted that the AO had not provided any other reason for initiating the reopening, specifically pinpointing the assessee's failure in this instance. Citing the case laws of HCL Technologies Vs. DCIT, Discovery Communication Inc Vs. Addl. CIT, and Oracle India Pvt. Ltd. Vs. ACIT, the Tribunal quashed the reopening. All other pleadings were rendered academic. The appeal was allowed.

What were the facts?

The assessee, M/s. Jain Textile Industries, filed its return for Assessment Year 2013-14 declaring a loss. The Assessing Officer (AO) completed the scrutiny assessment under Section 143(3) on June 1, 2016, at a loss of Rs. 10,88,750/-. Subsequently, the AO initiated reassessment proceedings under Section 147 on March 28, 2021, alleging that the assessee had reduced excise duty of Rs. 11,75,243/- from its total sales, leading to an under-assessment of income. The reopening was initiated more than four years after the end of the relevant assessment year, with the AO stating that the assessee had failed to disclose material facts fully and truly. The CIT(A)/NFAC upheld the reopening. The assessee appealed to the ITAT.

What were the issues?

1. Whether the reopening of assessment under Section 147 of the Income-tax Act, 1961, is valid, considering it was initiated more than four years after the end of the relevant assessment year and based on the alleged failure of the assessee to disclose material facts fully and truly. Assessee's Contention: The assessee argued that the reopening was invalid as it was initiated beyond the four-year period and the AO's reasons did not establish a failure to disclose material facts. The assessee relied on the case laws of HCL Technologies Vs. DCIT, Discovery Communication Inc Vs. Addl. CIT, and Oracle India Pvt. Ltd. Vs. ACIT. Revenue's Contention: The Revenue supported the impugned reopening. The judgment does not record specific arguments made by the Revenue beyond supporting the reopening.

Which sections of the Income-tax Act were involved?

Section 147,Section 143(3),Section 151

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: “SMC” NEW DELHI

Before: SHRI SATBEER SINGH GODARA

For Appellant: Adv. Sh. Tushar Kalra, Adv, Ms. Megha, Adv
Hearing: 04.08.2026Pronounced: 04.08.2026

This assessee’s appeal for assessment year 2013-14, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2026-27/1088610612(1), dated 23.04.2026 involving proceedings under section 147 r.w.s. 144 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused.

2.

It transpires at the outset during the course of hearing that the assessee/appellant herein presses for its first and foremost substantive ground challenging validity of the impugned reopening set into motion by the learned Assessing Officer after recording his following reasons to believe that

The order continues below.

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