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Facts
The revenue filed appeals against the orders of the CIT(A) who had quashed the reopening proceedings initiated under Section 147/148 of the Income Tax Act. The original assessment was completed under Section 143(3) and the reopening was done beyond four years from the end of the assessment year.
Held
The Tribunal held that the reopening of the assessment beyond four years was not justified as there was no allegation of failure on the part of the assessee to disclose material facts. The reopening was based on 'borrowed satisfaction' and attracted the first proviso to Section 147.
Key Issues
Whether reopening of assessment beyond four years is valid when there's no allegation of non-disclosure of material facts by the assessee.
Sections Cited
147, 148, 250, 143(1), 143(2), 142(1), 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH KOLKATA
Before: Shri Rajesh Kumar & Shri Pradip Kumar Choubey
आयकर अपील�य अ�धकरण, कोलकाता पीठ, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH KOLKATA Before Shri Rajesh Kumar, Accountant Member and Shri Pradip Kumar Choubey, Judicial Member & 1242/Kol/2025 Assessment Years: 2009-10 & 2010-11 DCIT, Circle-13(2), Kolkata……..……………………...… ….……….……Appellant vs. Padma Logistic And Khanij Pvt. Ltd.…………………….....……...…..…..Respondent 3C, 3rd Floor, Mukti World, 9/3B, Leelaroy Sarani, Kol– 19.. [PAN: AAECP2189C] Appearances by: Shri Sanat Kr. Raha, CIT-DR, appeared on behalf of the appellant. Shri Subhash Agarwal, Adv., appeared on behalf of the Respondent. Date of concluding the hearing : December 02, 2025 Date of pronouncing the order : December 12, 2025
ORDER Per Pradip Kumar Choubey, Judicial Member: Both the captioned appeals filed by the revenue are directed against the separate orders both dated 28.03.25 of the National Faceless Appeal Centre [‘CIT(A)’] passed under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) respectively. Since the issues involved in both the appeals are common and relate to the same assessee, therefore, these appeals have been heard together and are being disposed of by this consolidated order.
& 1242/Kol/2025 Padma Logistic And Khanij Pvt. Ltd 2. Both the appeals have been filed by the revenue with delays of 5 days. The revenue has filed separate affidavits for condonation of the delays. After considering the reasons cited in the affidavits for condonation of delay, we find that the reasons are valid and consequently, the delays in filing both the appeals are hereby condoned and we proceed to dispose of the appeals on merits.
Assessment Year 2009-10 – For the sake of convenience and narrations of facts, this appeal is taken as lead case.
Brief facts of the case are that the assessee Company filed its return declaring a total income of Rs.7,18,83,570/- on 24/09/2009 electronically and the Return was processed u/s.143(1). The case was subsequently selected for a regular assessment under the CASS. Accordingly, Notices were issued u/s. 143(2) & u/s 142(1) and in response to the same, the assessee furnished submissions and the Assessing Officer after through the submissions made by the assessee made the addition of Rs.4,98,92,473/- on account of disallowance of loss claimed in derivative transaction.
Aggrieved by the said order, the assessee filed an appeal before the CIT(A) wherein the appeal of the assessee has been allowed by quashing notice issued u/s 148 of the Act.
Being aggrieved and dissatisfied, the department has come in appeal raising the following grounds:
& 1242/Kol/2025 Padma Logistic And Khanij Pvt. Ltd
Contrary to that, the ld. AR supports the impugned order thereby submitting that the notice u/s 148 is time-barred and the same is bad in law as the said notice issued beyond four years from the end of assessment year under consideration. The ld. AR submits that the original assessment of the assessee was completed under Section 143(3) dated 02.12.2011 and the case was re-opened on 30.03.2016 which is beyond the four years from the end of assessment year, therefore, & 1242/Kol/2025 Padma Logistic And Khanij Pvt. Ltd proviso to Section 147 comes into play as there is no allegation found by the Assessing Officer regarding any failure on the part of the assessee to fully and truly disclose all material facts necessary for the assessment. The ld. AR also submits that in this case, the Assessing Officer has not made any independent verification of facts of assessee even though the relevant materials was in his possession. The ld. AR further submits that the notice u/s. 148 of the Act was issued on borrowed satisfaction of the Assessing Officer and the same may be quashed.
Upon hearing of the counsels of the both the parties and perusing the materials available on record, we find that in this case, the assessee filed original return of income on 24.09.2009, declaring total income of Rs.7,18,83,570/- and thereafter, the case was selected for scrutiny under CASS and assessment order u/s. 143(3) of the Act was passed on 02.12.2011 and further the case was reopened on 30.03.2016, which clearly shows that the reopening was done after the lapse of 4 years. We further find that the Assessing Officer has not recorded any allegation regarding any failure on the part of the assessee to fully and truly disclose all material facts necessary for the assessment. We note that the Assessing Officer has reopened the assessment beyond four years merely based on the borrowed satisfaction even there is no allegation that the income of the assessee has escaped assessment due to non-disclosure of the facts necessary for the assessment and since the assessment has been reopened after four years of the end of relevant assessment year, hence, the 1st Proviso to section 147 is attracted. Considering the above discussion, we do not find any reason to interfere with the order of the CIT(A) and the same is upheld and the appeal of the revenue is hereby dismissed.
& 1242/Kol/2025 Padma Logistic And Khanij Pvt. Ltd 9.
- Since the facts and issues involved in both the appeals are identical, therefore, our findings/directions given above in ITA No.1242/Kol/2025. Hence, is also dismissed.
In the result, both the appeals of the revenue are dismissed.
Kolkata, the 12th December, 2025.