KALPANA DILIP MEHTA AS LEGAL HEIR OF DILIP DALPATLAL MEHTA,WALKESHWAR vs. ACIT 19(1), MUMBAI

The CIT (A 143(2) of the hence, the as initio void. H quashed. 2. The CIT (A order dated 1 barred, and order is liable 3. The CIT (A assessment u loose, uncer received from the reopening quashed. 4. The CIT reasons con undisclosed survey". As it once recorded make the reop 5. The CIT (A justified in d reopening of without deali Therefore, the bad in law 6 Assessee did much less the has been mad basis of the a the accurate established t outside India. 7. The CIT (A have been unauthenticat in confirming 8. The CIT (A Assessee to s signing the sa Kalpana Dilip IT (A) failed to appreciate that the notice Act was time barred and bad in law, ssessment based on such a notice was Hence, the assessment order is liable t A) failed to appreciate that the assessm 18th March, 2014 passed by the AO was hence, bad in law. Hence, the assessm e to be quashed. A) failed to appreciate that the reopenin u/s 147 of the Act merely on the bas rtified and unverified sheets purport m foreign government is not justified. He g of assessment is bad in law and ma (A) failed to appreciate that the reco ntain factual mistakes that the all bank account was found "consequen t is not possible to improve upon the rea d, the factual mistake in the recorded rea pening of assessment bad in law. A) failed to appreciate that the AO was disposing off the Assessee's objection f assessment in a non-speaking ma ing with any of the Assessee's content e reopening of Assessee's assessment 6. The CIT (A) failed to appreciate that d not have any bank account outside In e bank account in respect of which add de. The CIT (A) failed to appreciate that on alleged 'base note' (which also did not con particulars of the Assessee), it could no that the Assessee held the bank acc . A) failed to appreciate that no addition c made on the basis of uncertif ted loose sheets, and hence, the CIT (A) e the addition of Rs. 19,48,46,625/-. A) failed to appreciate that the refusal of sign the consent waiver form was justifie ame would have amounted to making a f p Mehta as Legal Heir of Dilip Dalpatlal Mehta 2 TA No. 679/MUM/2025 u/s and s ab to be ment time ment ng of is of tedly ence, ay be orded leged nt to asons asons s not ns to anner tions. was t the ndia, dition n the ntain ot be count could fied/ erred f the ed as false statement tha account and subsequently adverse infer to sign the sa 9. The CIT(A) brought any m information Government a authenticated repeated requ of the source 'base note' cou 10. The CIT(A the Assessee, in confirming incorrect alleg the CIT (A) er AO in violatio 11. ⁠11. The the alleged 'b addition with currency in alleged 'base applied to co Hence, the qu in law. The Appellant in addition to each other an amend, alt Grounds of A 2. Briefly stated, fa filed his return of 07.12.2007 declaring was processed u/s 1 Act’). Subsequently, Kalpana Dilip IT at the Assessee was the owner of the all d would have been used against . Hence, the CIT (A) erred in drawing rence from the fact of refusal of the Asse aid consent waiver form. A) failed to appreciate that the AO had material on record to suggest that the all was actually received from Fr as alleged. The CIT(A) further failed to pro d/ certified copies of the same in spit uests which shows the absence of credib of the alleged information. Hence, the all uld not have been relied upon. A) failed to consider the submissions mad , the documents relied upon and further e g the addition on the basis of factu gations and surmises & conjectures. T rred in confirming the addition made by n of the principle of natural justice. CIT (A) failed to appreciate the ambigui base note', and hence, erred in confirming hout there being any evidence to show which the figures were mentioned in e note'. Furthermore, the conversion fa nvert such currency into INR was incor uantification of the amount of addition is t states that the above Grounds of Appea o, in the alternative and without prejudic nd the Appellant further craves leave to ter or delete any of the a Appeal. acts of the case are that assesse income for the year under co g total income at Rs. Nil. The re 43(1) of the Income-tax Act, 196 information was received in t p Mehta as Legal Heir of Dilip Dalpatlal Mehta 3 TA No. 679/MUM/2025 leged him g an essee d not leged rench ovide te of bility leged de by erred ually Thus, y the ity in g the w the n the factor rrect. s bad al are ce to add, above ee had originally onsideration on eturn of income 61 (in short ‘the the case of the assessee from the ‘Fr was maintaining a Switzerland. The said note in relation to b personal details of th place of birth, sex, account and amou Subsequently, a sur 30.09.2011 by th Department, Mumba was confronted with account, then, he ac account as undisclo information received the survey proceedin believe that income e of the Act on 30.03. proceedings, a summ assessee. Further a 23.10.2013 calling Rs.19,48,46,625/- e U ) should not be a the assessee howeve opened nor operated Kalpana Dilip IT rench’ Government indicating th a foreign bank account in d information is commonly kno bank account. The said base he assessee including his name nationality along with date o unt of the balance in p rvey u/s 133A of the Act was e Investigation Wing of t ai. During the survey proceeding h the information related to th ccepted the amount lying in th osed income in his hands. I coupled with the finding durin ngs, the Assessing Officer recor escaped assessment and issued .2012. During the course of th mon u/s 131 of the Act was als a show cause notice was a upon as why the balanc equivalent to U 43,29,943 added to the total income of the er responded that said accou or controlled by him. The Ld. A p Mehta as Legal Heir of Dilip Dalpatlal Mehta 4 TA No. 679/MUM/2025 hat the assessee HSBC Geneva, own as the base note containing e, date of birth, f opening bank articular year. carried out on he Income-tax gs, the assessee he foreign bank he foreign bank In view of the ng the course of rded reasons to d notice u/s 148 he reassessment so issued to the also issued on ce amount of (@ 45 INR per e assessee. But, unt was neither Assessing Officer keeping in view the f balance lying in for unexplained income of the Act. 3. On further app grounds raised by the assessee on merit of t 4. Aggrieved the as of raising grounds as 5. With reference t for the assessee refe 85. The Ld. counsel 30.03.2012, a copy The Ld. counsel subm Act, no notice u/s 1 assessee, which is a scrutiny thereafter Officer was required limitation of six mon the return of income notice u/s 143(2) of t the limitation for i 30.09.2013 , since th Kalpana Dilip IT facts and circumstances of the c reign bank account of Rs.19, as part of total income of the as peal, the Ld. CIT(A) rejected th e assessee and also dismissed t the addition. ssessee is in appeal before the T s reproduced above. to ground No. 1 of the appeal, erred to the Paper Book contain referred to notice u/s 148 of th of which is available on Paper mitted that after issuing notice 43(2) of the Act was issued in juri ictional requirement for t as juri ictional requirement. to issue notice u/s 143(2) of th nth from the end of the financia was filed. The Ld. counsel sub the Act was issued only on 23.1 ssuing the notice under 143 he return of income in respons p Mehta as Legal Heir of Dilip Dalpatlal Mehta 5 TA No. 679/MUM/2025 case treated the 48,46,625/- as ssessee u/s 69A he various legal he appeal of the Tribunal by way the Ld. counsel ning pages 1 to he Act issued on r Book page 11. e u/s 148 of the the case of the aking a case for The Assessing he Act within the al year in which mitted that first 0.2013 whereas 3(2) expired on se to notice u/s 148 was filed on 25/ the Act issued is bey proceedings are not assessee in support Hon’ble Supreme Co (2010) 188 taxman High Court in the ca Ltd. ITA No. 887-88 of the Tribunal in th ITA No. 2532/Mum/ 6. In support of g submitted that the barred by the limitati counsel referred to submitted that reas within one year from notice u/s 148 of th the Act has been se reassessment procee 31.03.2013 whereas completed on 18.03.2 7. The Ld. Departm relied on the finding Kalpana Dilip IT /04/2012 , therefore, the notic yond the limitation period. Hen sustainable in law. The Ld. t of contention relied on the ourt in the case of ACIT v. H nn.com 113 (SC) , decision o ase of PCIT v. Paramount Biot 88/2017 and decision of the Co he case of Dhaval Exim Pvt. L /2023. ground No. 2 of the appeal, t reassessment order passed b ion and therefore, liable to be qu the provisions of section 153 ssessment proceedings have to m the end of the relevant financia he Act was served. Since the no erved on 30/03/2012, therefor edings was to be completed the present assessment procee 2014. mental Representative (DR) on of the Ld. CIT(A) wherein he h p Mehta as Legal Heir of Dilip Dalpatlal Mehta 6 TA No. 679/MUM/2025 ce u/s 143(2) of nce, the scrutiny counsel for the decision of the Hotel Bluemoon f Hon’ble Delhi tech Industries -ordinate Bench Ltd. v. ACIT in the Ld. counsel by the AO was uashed. The Ld. of the Act and o be completed al year in which otice u/s 148 of re, accordingly d on or before edings has been the other hand, held that in view of the information so & TR Division of the year for completion was within the limita reproduced as under “5.1 In the 1s the validity of that the asse the appellant 30.03.2012 a by 31.03.201 has therefore has been p prescribed in contention of comments an vide his lette instant case a CBDT on 12. Swiss Author - Switzerland the Competen Division on 12 this letter. It i by explanatio that the time between forw date of receip less. In the 12.03.2013 a one year and appellant tha been passed of 31.03.20 appellant is 8. The Ld. couns during the relevant p Switzerland regardin Kalpana Dilip IT ought under exchange of inform CBDT, the Assessing Officer go of the assessment and therefo ation. The relevant finding of th : t ground of appeal the appellant has cha f the order U/s 143(3) r.w.s. 147 on the essment is time barred. In support of the t states that the notice U/s 148 was ser and hence the order was required to be 3 as against the order passed on 31.03.2 e been argued by the appellant that th passed beyond the statutory time li n the Act and hence is time barred the appellant was forwarded to the AO nd report vide letter dated 13.07.2015. T er dated 01.06.2015 has informed that a reference was made to the FT & TR Div 03.2012 to obtain certain information fr rities under the Articles of Exchange in th d DTAA and this request was duly forwa nt Authority of Switzerland by the FT 2.03.2013. The AO has also furnished a is thus noticed that the instant case ius c on to Section 153 of the Act which lays e barring period shall not include the warding of request to another juri iction a pt of the information or one year which instant case the request was forward and hence the period of limitation is exten d thus there is no merit in the argument at the case is time barred with the order on 18.03.2014 as against the time barrin 013. This ground of appeal o dismissed.” sel for the assessee however period there was no treaty bet g exchange of information. In t p Mehta as Legal Heir of Dilip Dalpatlal Mehta 7 TA No. 679/MUM/2025 mation by the FT ot additional one ore, assessment he Ld. CIT(A) is allenged ground e same, rved on passed 2014. It e order mit as d. This O for his The AO t in the vision of rom the he India arded to T & TR copy of covered s down period and the hever is ded on nded by t of the having ng date of the submitted that tween India and the treaty which has been signed is o relevant assessment by the FT&TR Divisio was ‘invalid reference extension of limitatio the decision of the C Sawhney v. ACIT in 9. We have heard the relevant material ground is the perio required to complete 147 of the Act. The under section 147 153(2) of the Act . T reproduced as under “(2) No order shall be mad from the end section 148 w Provided tha on or after th April, 2000, s may be made Provided fur was served o the 1st day o shall have ef "nine months" Kalpana Dilip IT operative from the subsequent year. Therefore, the reference on for the assessment year unde e’ and the invalid reference can on. The Ld. counsel for the ass Co-ordinate Bench in the case ITA No. 1539-1544/Mum/20 rival submissions of the parti ls on record. The issue in dispu od within which the Assessi e the reassessment proceedings e relevant limitation period for of the Act has been provided he relevant provision during re : r of assessment, reassessment or recom de under section 147 after the expiry of o of the financial year in which the notic was served : at where the notice under section 148 wa e 1st day of April, 1999 but before the is such assessment, reassessment or recom e at any time up to the 31st day of March, rther that where the notice under sec on or after the 1st day of April, 2005 bu of April, 2011, the provisions of this su ffect as if for the words "one year", th " had been substituted :109 p Mehta as Legal Heir of Dilip Dalpatlal Mehta 8 TA No. 679/MUM/2025 period from the which was sent er consideration nnot validate the sessee relied on of Shri Pravin 17. ies and perused ute raised in the ng Officer was s under section r passing order d under section elevant period is mputation one year ce under as served st day of mputation , 2002 : ction 148 ut before b-section he words

The con appellant refe and, therefore any force in elsewhere, si the Assessing 2008-09 only Act also refers for A.Y 2008-0 17. The quar order framed limitation per considered op examine whe in accordance u/s 142(2A) assessment o which are int the amount ground before by limitation, material aspe assessment o 18. The co-o Bhushan Lal 64/190 ITD 2 Lata Sawhne 439/DEL/20 Swiss author would be per ordinate Benc "Learned Cou letter Dated 2 addressed to specifically m provided from covered by t Double Taxat Switzerland. from 1-4-2011 on record Not Switzerland C These would Kalpana Dilip IT tention of the ld. DR that the letter erred to both the A.Ys i.e. 2008-09 and 2 e, there is no error in the same. We do n this contention of the ld. DR. As me ince each A.Y is considered as a separa g Officer should have made out a case y and since the order framed u/s 142(2) s to A.Y 2009-10, then the same cannot b 09. rrel before us is as to whether the asse d u/s 143(3) is passed within the pe riod prescribed under the Act or not. pinion, for coming to such a conclusion, ether the order passed u/s 142(2A) of the e with law or not. It is true that the order p of the Act is not appealable but wh order is challenged, then the different a tegral to the process and ultimate comple can be challenged in appeal and sin e us is challenged for assessment being we are well within our rights to cons ects which were considered while fram order u/s 143(3) of the Act." ordinate bench in one of the group ca Sawhney v. Dy. CIT [2021] 127 taxma 225 (Delhi -Trib) through his L/H wife Sm ey ITA Nos. 427 to 432/DEL/2017 & 17 had the occasion to consider refere rity and reply received by Swiss autho rtinent to refer to the said observation of ch which reads as under: unsel for the Assessee also placed on 26-6-2015 issued by Swiss Competent Au o the Government of India in which mentioned that information as required co m F.Y. 2011-2012 as the prior years a temporal scope of Article 26 of the Am tion Avoidance Agreement between Ind Therefore, such information could be p 1. Learned Counsel for the Assessee also tification Dated 27-12-2011 between Ind Confederation for avoidance of double ta clearly show that these are applicabl p Mehta as Legal Heir of Dilip Dalpatlal Mehta 12 TA No. 679/MUM/2025 to the 2009-10 not find ntioned ate unit for A.Y ) of the be used essment eriod of In our we can e Act is passed hen an aspects, etion of nce the barred ider all ming the ases of ann.com mt. Sneh 434 to ence to ority. It the Co- record uthority h it is ould be are not mended dia and rovided o placed dia and axation. le after assessment y provided vide could be pr Authorities h Authorities in HSBC, Genev & ITA.Nos.43 Sawhney thr New Delhi. fo 2006-2007 to 19. In light of considered v department f received by th would be a f that too, by a opinion, the p claimed by t clearly bared 20. Since we limitation, we of the case. T allowed.” 9.2 Fact in the insta Shri Praveen Sawhn exchange of informa April, 2011 whereas t assessment year 200 therefore, said proto relevant to the asses sent by the AO in the of precedent in the c assessment order sh the end of the finan Kalpana Dilip IT years under appeals and as per infor e letter Dated 26-6-2015 no such infor rovided prior to 1-4-2011. Therefore, ave not provided any information to R n India about assessee's bank accoun va, Switzerland ITA.Nos.427 to 432/Del 34 to 439/Del./2017 Late Shri Bhush rough his L.R./Wife Smt. Sneh Lata Sa for assessment years under appeals i.e 2011-2012." f the aforementioned discussion, we are view that the information called for from Swiss authorities could not hav hem for the period prior to 1-4-2011. Ther futile exercise to wait for such informatio an invalid reference. Therefore, in our con period of limitation could not be exten the Revenue. The impugned assessmen by limitation and deserve to be quashed. e have quashed the assessments as bar e do not find it necessary to dwell into the The common ground in the captioned app ant case are identical to the fac ney (supra) as the protocol in tion came into operation from the relevant financial year corre 07-08 is from 01.04.2006 to 3 ocol was not in operation du sment year therefore, this refer e year under consideration was case of Shri Praveen Sawhney hould have been passed within cial year in under section 148 p Mehta as Legal Heir of Dilip Dalpatlal Mehta 13 TA No. 679/MUM/2025 rmation rmation Swiss Revenue nt with l./2017 han Lal awhney, ., A.Ys. e of the by the e been refore, it on, and sidered ded as nts are . rred by e merits peals is ts in the case of relation to the the first day of esponding to the 31.03.2007 and ring the period rence which was invalid. In view (supra), the re- n one year from of the Act was served. Since in the served on 30/03/201 been completed on o order has been pass period of limitation, quashed. The ground 9.1 The Ld. counsel of the appeal and s Bench of the Tribuna Kalra in ITA No. 53 simply on the basis o bank account witho finding of the Tribuna “151. We ma statement ca corroborative is no evidence statement. Mo the informat maintained w evident from response has made to Sw material wha search. Unde provisions of the instant ye of suspicion p 152. Keeping that the addi 2006-07 and direct the AO Kalpana Dilip IT case notice under section 148 12 and therefore the reassessme or before 31/03/2013 whereas sed on 18/03/2014, which be , the entire reassessment pro d No.2 of the appeal of the asses l for the assessee also referred submitted that on the merit a al in the case of ACIT v. Sh. Pa 330/Del/2016 that addition c of photocopy of document indica out corroboration of the same al (supra) is reproduced as unde ay further point out that it is settled la annot be read in isolation withou material. In the present case, we find tha e placed on record by the AO to corrobor oreover, the Revenue itself is not clear w tion pertains to the alleged bank a with HSBC, Zurich or HSBC, Geneva m the paper book filed by the Reven s been received in response to the ref wiss Competent Authority. No incrim tsoever has been found during the cours er the facts and circumstances in our vie Section 69 are not attracted to the asse ear. The AO has made the addition on th pertains to the bank account. g in view, the overall facts, we are of th ition made by the AO in the assessmen 2007-08 cannot be sustained. According to delete the same.” p Mehta as Legal Heir of Dilip Dalpatlal Mehta 14 TA No. 679/MUM/2025 8 of the act was ent should have the assessment eing beyond the oceedings stand ssee is allowed to ground No. 3 also Co-ordinate arminder Singh cannot be made ating balance in e. The relevant er: aw that ut any at there rate the whether account a as is nue. No eference minating e of the ew, the essee in he basis he view nt years gly, we

2 In the instant c of photocopy of a do bank account with H by a nonofficial route been forwarded to th bank account has Therefore following Tribunal (supra), no Since we have alrea the ground of limitat on merit is rendered 10. In the result, th Order pronounced (RAJ KUMAR C JUDICIAL M Mumbai; Dated: 15/04/2025 Rahul Sharma, Sr. P.S.