HIGH VOIT ELECTICALS P LTD ,MUMBAI vs. INCOME TAX OFFICER WARD -1 , PALGHAR

On the fac CIT(A) erred i reopening th limitation and 3. On the fac CIT(A) erred i passing the a On the facts CIT(A) erred i making an ad receipts reflec 5. On the fac CIT(A) erred i making an a incurred for c which is cons 2. Briefly stated, fa return of income for year 2013-14, the A Income-tax Act, 196 believe that income information received payment of Rs Rs.1,53,68,205/- an compliance was mad issued. Subsequentl 142(1) of the Act on same was not comp 20.08.2021 but sam compliance, the Asse High ITA cts and circumstances of the case and in in confirming the action of ld. Assessing O he assessment u/s 147 which is ba d illegal and void ab initio. cts and circumstances of the case and in in confirming the action of ld. Assessing O assessment order on a non-existing entity. and circumstances of the case and in in confirming the action of ld. Assessing O ddition of Rs. 17,78,645/- being profit @ cted in the ITS/Form 26AS. cts and circumstances of the case and in in confirming the action of ld. Assessing O addition of Rs. 3,62,292/- being exp credit card payment as reflected in ITS sider in PAN of AABCH7678H. acts of the case are that in view the year under consideration t Assessing Officer issued notice 1 (in short ‘the Act’) after recor escaped assessment particul d from the ITS details reflect s.3,62,292/-; undisclosed nd contract receipt of Rs.68 de on the part of the assesse ly, the Assessing Officer issu n 19.10.2020 raising detailed plied. Again a final opportunity me was also not complied. In essing Officer made the assessm h Volt Electricals P. Ltd 2 A No. 4461/MUM/2025 n law, ld. Officer in arred by n law, ld. Officer in . law, ld. Officer in @ 8% on n law, ld. Officer in penditure S details w of non-filing of that assessment u/s 148 of the rding reasons to arly in view of ing credit card turnover of 8,64,865/-. No ee of the notice ued notice u/s query, however y was issued in n view of non- ment u/s 144 of the Act, wherein he through American Ex to Rs.3,63,292/- u/s charges of Rs.1,53,68 which was worked ou 2.1 In appeal before assessee contended “AABFH1723L” in th in fact a company. T of the assessee i.e. F the correct status o claimed to have requ the old PAN continue information—such transactions—was e departmental records accounted for and of PAN. 2.2 The Ld. CIT(A) Officer. During rem documents before th Assessing Officer, in double PAN allotmen assessee’s explanatio High ITA made addition for the (i) credi xpress Banking Corporation Gr s 69C of the Act, (ii) profit @ 8% 8,205/- and contract receipt of ut to Rs.17,78,645/-. the Commissioner of Income Ta that it had originally been e status of a partnership firm, The fourth letter in this PAN den stand for Firm. A fresh PAN “AA of company was later allotted uested cancellation of the earlier ed to subsist. According to the a as contract receipts and rroneously reflected against t s, although these very items ha ffered to tax in the return filed called for a remand report from mand proceedings, the assesse he Assessing Officer to justify n remand proceedings, accept nt and status mismatch but did on on the ground that the said d h Volt Electricals P. Ltd 3 A No. 4461/MUM/2025 it card payment roup amounting % on the service f Rs.68,64,865/- ax (Appeals), the n allotted PAN although it was notes the status ABCH7678H” in d. The assessee r PAN; however, assessee, certain d credit card the old PAN in ad already been d under the new m the Assessing ee filed all the y its claim. The ted the fact of d not accept the documents were not filed during the and that the assesse dealings. Though, th the Ld. CIT(A) reject the estimation of the contract receipt and expenses. The releva under: “5.1 Grounds 17,78,645/- t Service Tax Rs.68,64,865 totaling to Rs that the asse 148 of the Ac Further, the le is company, h different in n the PAN and juri iction of contended tha due to absen determined @ Books of Acco law. The app passing an o opportunity speculation, s which is Rs. 68,64,865/- r income @ 8% 5.2 During th appellant has Further, a no competent au file return of i from the serv the AO, the i High ITA course of original proceedings ee continued to use both PANs he Assessing Officer verified all ed the contention of the asses e 8% addition on the service t d also upheld the disallowance ant finding of the Ld. CIT(A) is s of the appeal are directed against the that was determined at 8% of its turnover x Return amounting to Rs.1,53,6 5/- on account of gross receipts from .2,22,33,070/- by the AO. The appellant essee has never received the notice for R ct, 1961 and service of order was dated earned officer has stated in his order tha however on PAN it belongs to Partnership nature and it has already filed letter for d the same has already been furnished fficer on dated 18/10/2012. The appella at the learned officer erred by stating in nce of documentary evidence total inc @ 8%, however the learned officer has ne ounts, consideration of income on ad-hoc ellant has claimed that the learned office order as it does not comply with basi of being heard. The learned office surmises and conjectures by way cons . 1,53,68,205/- as per Service Tax R receipt in the form of contract receipts co which is Rs. 17,78,645/- as income of th he assessment proceedings, the AO has s not file its return of income for the otice u/s 148 was issued after prior a uthority on 18/03/2020 after recording income for the relevant assessment year vice of this notice. As per the information information received from the ITS details h Volt Electricals P. Ltd 4 A No. 4461/MUM/2025 s before the AO s in commercial the details but ssee and upheld tax charges and e of credit card s reproduced as addition of Rs. r reported in the 68,205/- and contract work t has contended Re-opening u/s d 30/12/2021. at the assessee p Firm which is cancellation of d to concerned ant has further n the order that come has been ver rejected the basis is bad in er has erred by ic condition i.e. r indulged in idering amount Return and Rs. onsidering total e assessee. found that the e A.Y 2013-14. approval of the the reasons to within 30 days n available with s reflects credit card payme Rs.1,53,68,20 and receipt of the FY 2012-1 for the year made and th Income Tax A 5.3 During th notices to t opportunities the AO. How response to t entire Scrutin and providing the claim of t natural justic factually inco non-complied with no optio u/s144 of the the assessme letter was sen was made by neither filed I 2013-14 u/s the IT Act. Th appellant had Return and a receipts durin course of as requisite det thereon durin return filed fo submission n before the AO not possible f Consequently possible expe income of th assessed the determined at in the Servi Rs.68,64,865 totalling to R 144 of the Inc High ITA ent of Rs.3,62,292/-, undisclosed 05/- which has been reported the Serv f Rs.68,64,865/- in the form of contract 13. Since, in this case no return of income under consideration accordingly, no as he only requirement to initiate proceedin ct, 1961 is the reason to believe, which w he assessment proceedings, the AO has the appellant which clearly shows to submit its response was provided to th wever, no compliance from the appellant the notices u/s 148 & 142(1) of the IT ny proceeding despite several repeated g numerous opportunities to make comp the appellant that the AO has violated ce by not providing opportunity of b orrect and unacceptable. Since the appe during the whole scrutiny proceedings, t on but to pass the best judgment ass e Income Tax Act 1961 in the case of th ent year 2013-14. In this regard, ex-par nt to the appellant by the AO. However, y the appellant 5.4 It was clear that the IT return of income for the relevant asses 139 of the Act nor in response to the no he AO was in the possession of the infor d reported turnover of Rs.1,53,68,205 in also receipts of Rs.68,64,865/- in the fo ng the FY 2012-13, totaling to Rs.2,2 ssessment proceedings, it was asked tails w.r.t. contractual receipts and i ng the year under consideration and copy or the period under consideration. Howev nor any written reply was submitted by O. In the absence of the documentary ev for the AO to verify the correctness of y, the AO has taken the liberal view and enses before reaching at a conclusion w he appellant. Accordingly, the AO has total income of the appellant for A.Y.20 t Rs. 17,78,645/- which was 8% of its tu ice Tax Return amounting to Rs.1,53 5/- on account of gross receipts from Rs.2,22,33,070/- under best judgment a come Tax Act, 1961. ME TAX DEPARTME h Volt Electricals P. Ltd 5 A No. 4461/MUM/2025 turnover of vice Tax Return receipts during e has been filed ssessment was ngs u/s.147 of was recorded. issued multiple that several he appellant by t was made in Act during the d request made pliances. Hence, the principle of being heard is ellant remained the AO was left sessment order he appellant for rte show cause again no reply e appellant has ssment year i.e otice u/s 148 of rmation that the the Service Tax form of contract 22,33,070/-. In to furnish the income earned y of Service tax ver, neither any y the appellant vidence, it was f the accounts. allowed all the with respect to estimated and 13-14 that was urnover reported 3,68,205/- and contract work assessment u/s 5.5 It is also r the appellant AO, the circ additional evi additional evi of two PANs, double allotm this does not the PAN - AA information w regular finan mistake does suppress its assessee's co under the PA assessee has this claim. 5.5.1 Further, proceedings f AABCH7678H (receipts on accord. It wa AABFH1723L and thereafte the Act. What that the asse during the co AO thereby no to verify his AABFH1723L during both And once the assessee puts or verifiable p was not satisf far. 5.5.2 On ver assessee has AABCH7678H was selected was complete Rs.2,35,31,73 department's was selected notice u/s. High ITA relevant to mention that a Remand Repor t for AY 2013-14 was received from the cumstances referred to in Rule 46A idence have not been fulfilled in the insta idence should not be admitted. With resp the AO has stated that the appellant's s ment of PAN and status mismatch is cor absolve the assessee from its mistake o ABFH1723L with the third parties from w was received and from whom the asse ncial transactions. As per the AO, Pr s not seem inadvertent and it looks like receipts with the PAN AABCH7678H. ontention that the income has already AN - AABCH7678H does not hold any s not produced any verifiable evidence r, the AO has found that during the origin for A.Y.2013-14 u/s. 143(3) of the Act H, the assessee never produced th the PAN - AABFH1723L) before the A as only after the system captured receipt L that the department came to know abou er the case was selected for re-assessme t is even more alarming in the instant cas essee did not make any compliance nor urse of faceless proceedings for re-asses otes that the assessee deliberately did n stand (regarding offering the income u L while filing return under the PAN - the assessment and the re- assessmen e assessment proceedings have been s this stand and that too unaccompanied proof. Therefore, keeping in light the abov sfied with the assessee's explanation/sta rification of case records, the AO has n s filed its return of income on 27/08/201 H showing total income of Rs.2,23,68,2 d for scrutiny under manual selection a ed u/s. 143(3) on 29/02/2016 assessing 30/-. Thereafter, new information wa system for the PAN - AABFH1723L. The d for re-assessment by recording reason 148 of the Act. Thereafter, the re-as h Volt Electricals P. Ltd 6 A No. 4461/MUM/2025 rt in the case of AO. As per the for producing ant case, hence pect to allotment stand regarding rrect. However, of not changing whom, the said essee is having rima facie, the e an avenue to Therefore, the y been offered water and the to substantiate nal assessment under the PAN his information AO by his own ts on the PAN - ut these receipts ent u/s. 147 of se was the fact r put this stand ssment. So, the not allow the AO under the PAN AABCH7678H) nt proceedings. completed, the d by any cogent ve facts, the AO nd produced so noticed that the 3 with the PAN 27/-. The case nd assessment g total income at as received on refore, the case ns and issuing ssessment was completed ex The AO estim treated the c 69C of the A added incom Further, the A return of incom return of incom 5.5.3 Other re a. The assess because than third parties w b. Further, th their reply is a c. The assess penal proceed Portal. 5.6 I have g contention of proceedings, form no. 35 record, reman regarding dou However, the AABFH1723L on the basis clear case to Hence, the u appellant's co under the PA assessee has this claim. Fu A.Y.2013-14 the appellant PAN AABFH1 the system c department c case was se system of th appellant, the easily escape High ITA

194C 21-Feb-2013 P 2. 194C 21-Feb-2013 P 3. 194C 28-Jan-2013 P 4. 194C 28-Jan-2013 P 5. 194C 13-Dec-2012 P 6. 194C 13-Dec-2012 P 7. 194C 26-Nov-2012 P 8. 194C 26-Nov-2012 P 9. 194C 05-Nov-2012 P 10. 194C 05-Nov-20I2 P 11. 194C 29-Sep-2012 P 12. 194C 29-Sep-2012 P 13. 194C 31-May-2012 P 14. S94C 31-May-2012 P 15. i94C 07-May-2012 P 16. 194C 07-May-2012 P 3.1 The relevant en receipts in question therefore, no additio reflected in the old contention of the Ld. have been reduced in against old PAN and of contract receipts assessee. High ITA

00 16 25-Jun-20l3 B -818894.00 -1 21-Dec-2012

00 16 21-Dec-2012 B -818895 00 -1 21-Dcc-2012

00 16 21-Dec-20i2 B -818894 00 -1 21-Dec-2012 - 818894.00 16 2l-Dec-2012 B -818894.00 -1 ntries in Form 26AS clearly evid n had been nullified against on was required in the case d PAN of the assessee. We . counsel for the assessee as re n the form of 26AS issued by therefore, no addition was warra which were reflected in the h Volt Electricals P. Ltd 9 A No. 4461/MUM/2025 6378.00 16378.00 6378.00 -16378.00

00 2652 00 -22652.00 6378 00 16378.00 6378.00 -16378.00 6378.00 16378.00 6378 00 -16378.00 6378.00 16378.00 6378.00 -16378.00 6378.00 16378.00 6378 00 -16378.00 6378.00 16378.00 6378.00 -16378.00 6378.00 16378.00 6378 00 -16378.00 denced that the the old PAN, of the receipt agree with the espective receipt the Department anted in respect old PAN of the 3.2 Similarly, regar the Ld. counsel for th of the assessee, wh reported at Rs.31,87 has been provided o charges of Rs.1,53,68 is that this amount PAN and not include PAN. The assessee h Rs.1,53,68,205/- wh ready reference said s “ Date

CIT 4. DR, ITAT, Mumbai 5. Guard file.