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Facts
The assessee's original assessment u/s 143(3) for AY 2013-14 was completed on 23.12.2015. Subsequently, the case was reopened u/s 147 by notice dated 05.04.2018 (after four years), leading to an addition of Rs.19 lacs for unsecured loans u/s 68. The assessee argued that the information regarding the loan was already disclosed during the original assessment, and the reopening was invalid. There was also a 244-day delay in filing the appeal, which the assessee sought to condone due to technical glitches with their registered email ID.
Held
The Tribunal condoned the delay in filing the appeal, finding the reasons bonafide. On the legal issue, the Tribunal held that since the original assessment was completed u/s 143(3) and the information regarding the unsecured loan was already examined by the AO, and the reasons recorded for reopening did not demonstrate the assessee's failure to disclose material facts, the reopening of assessment u/s 147/148 after four years was invalid, citing the Supreme Court's decision in ACIT vs. CEAT Ltd. Consequently, the reopening was quashed.
Key Issues
1. Whether the delay of 244 days in filing the appeal should be condoned. 2. Whether the reopening of assessment under Section 147/148, after four years from the end of the relevant assessment year and subsequent to a Section 143(3) assessment, was valid when the issue of unsecured loans was already examined during the original assessment and there was no failure on the part of the assessee to disclose material facts.
Sections Cited
147, 148, 143(3), 271(1)(c), 68, 133(6)
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Income Tax Appellate Tribunal, “A” BENCH, KOLKATA
This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 17.07.2023 for the AY 2013-14.
At the outset, we note that there is a delay in filing of appeal by 244 days. Explaining the delay, the Counsel of the assessee stated that the registered mail id of the assessee got corrupted and did not function properly and therefore the notices could not be accessed and complied with. The order passed by the ld. CIT(A) was only became known to the assessee when penalty notice u/s 271(1)(c) of the Act was received by the assessee. Thereafter the appeal was got prepared and filed before the Tribunal with a delay of 244 days. The ld. Counsel
The ld. DR on the other hand submitted that the assessee has not explained the reasons for delay to be sufficient and bonafide and therefore, the appeal may be dismissed.
Having taken into account the affidavit filed by the assessee and reasons explained therein, we are of the view that the delay is for bonafide and genuine reasons and the assessee can not be denied justice on the ground that the appeal being filed late due to technical glitches. Therefore, we are inclined to condone the delay and admit the appeal for adjudication.
The ld. Counsel for the assessee has challenged the order of the ld. CIT(A) on legal issue as well as on merit. So far as the legal issue is concerned, the assessee has challenged the reopening u/s 147 of the Act and as far as merit of the case is concerned, the assessee assailed the order of ld. CIT(A) for sustaining the addition of Rs.19 lacs as made by the ld. AO u/s 68 of the Act.
The facts in brief are that the return was filed on 29.03.2013, declaring total income of Rs.3,04,06,700/-. The assessee is engaged in the business of manufacturing LPG Cylinders. The case of the assessee was selected for scrutiny and assessment was framed vide order dated 23.12.2015 u/s 143(3) of the Act, assessing the total income of ₹3,32,92,260/-. The case of the assessee was reopened u/s 147 of the Act, by issuing notice u/s 148 of the Act dated 05.04.2018,
In the appellate proceedings, before the ld. CIT (A) the appeal was decided ex-parte in limine when the assessee failed to respond on three occasions when the assessee was provided opportunity of hearing.
Now, the ld. Counsel for the assessee has raised a legal issue before us, challenging the reopening of assessment u/s 148 of the Act. The ld. AR stated that impugned assessment year is A.Y. 2013-14 and notice u/s 148 of the Act was dated 04.04.2018, apparently, the reopening of assessment was made four years after the end of the relevant assessment year. The ld. AR referred to the reasons recorded a copy of which is available in the paper book and submitted that issue which was subject matter of the reasons recorded i.e. the assessee being beneficiary of unsecured loans of ₹19 lacs was also the issue which was raised in the original assessment proceeding and all the information/ details were duly furnished before the ld. AO and even the AO issued notice u/s 133(6) of the Act, dated 01.10.2015 to the lender M/s Tirumala Suppliers Pvt. Ltd. calling for the details of transactions, nature of transaction and various other details including the copies of ledger account, acknowledgement of ITR, balance sheet, P & L account, whether the loan was given through banking channel, which was replied by the said party vide letter dated 19.10.2015. The
The ld. DR on the other hand relied on the orders of the ld. lower authorities.
After hearing the rival contentions and perusing the materials available on record, we find that case of the assessee has apparently
In the result, the appeal of the assesseeis allowed on legal issue.
Order pronounced in the open court on 04.03.2025.