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Facts
The assessee failed to file income tax returns for multiple assessment years. The Assessing Officer (AO) received information regarding substantial cash deposits made by the assessee in a cooperative society's account, which were found during a search and seizure operation at the society's premises. The AO reopened the assessment u/s 147 of the Income Tax Act.
Held
The Tribunal held that the reopening of assessment u/s 147 was invalid because the information emerged from a search and seizure operation, which necessitates action under Section 153C of the Act. Since the reopening was based on information from a third-party search, the AO should have invoked Section 153C instead of Section 147.
Key Issues
Whether the reopening of assessment under Section 147 was valid when the information leading to it was discovered during a search and seizure operation at a third party's premises, which might attract Section 153C.
Sections Cited
147, 144, 271(1)(c), 142(1), 144B, 69A, 139, 115WD, 115WE, 143, 115WH, 148, 115WF, 132, 132A, 153A, 153C, 153, 132(4), 69A, 115BBE
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Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE
Before: SHRI MANISH BORAD & SHRI VINAY BHAMORE
ORDER PER BENCH : These bunch of six appeals filed by the assessee are directed against the separate orders dated 20.12.2024 passed u/s 147 r.w.s. 144 of the Act and dated 05.02.2025 passed u/s 271(1)(c) of the Act by Ld. CIT(A)/NFAC for the assessment years 2013-14, 2015-16 and 2016-17 respectively. 2. Since the identical facts and common issues are involved in all the above captioned six appeals as per respective grounds of appeal
440, 441, 1089, 1092 & 1093/PUN/2025 emanate from records, we proceed to dispose of the same by this common order.
3. First, we shall take up appeal of the assessee in for A.Y. 2013-14 for adjudication.
1. A.Y 2013-14 : 4. Facts of the case, in brief, are that the assessee is an individual and has not filed his return of income for the year under consideration. The Assessing Officer in this case received information from ACIT, Central Range-1(1), Mumbai that the assessee had made cash deposit of Rs.50,51,750/- as a member of the society in the account maintained with M/s. Shri Renuka Mata Multistate Credit Society Ltd. In the case of M/s. Shri Renuka Mata Multistate Credit Society Ltd. a Search & Seizure Action was carried on 26/05/2017. During the search action, the above information had been revealed. On verification of details available on record it is seen that the assessee had not furnished his return of income although substantial cash of Rs.50,51,750/- has been deposited in the account of M/s. Shri Renuka Mata Multistate Credit Society Ltd. After analyzing above information the Assessing 440, 441, 1089, 1092 & 1093/PUN/2025 Officer came to the conclusion that the source of the cash deposit of Rs.50,51,750/- in the bank account remained unverified. Accordingly, the Assessing Officer was satisfied that the income of Rs.50,51,750/- have escaped from taxation. He, therefore, reopened the case u/s 147 of the IT Act after obtaining prior approval from the competent authority and notice u/s 148 dated 31.03.2021 was issued to the assessee. In response to this notice, the assessee neither requested for any adjournment nor furnished any submission. Therefore, statutory notices u/s 142(1)/reminders/show- cause notice were issued along with questionnaire and the assessee again did not make any compliance. Accordingly, the Assessing Officer completed the assessment u/s 147 r.w.s. 144 r.w.s. 144B of the IT Act by determining the total income at Rs.50,51,750/-. The above assessed income includes addition of Rs.50,51,750/- u/s 69A of the IT Act as unexplained money.
5. Aggrieved with the above assessment order, an appeal was filed before Ld. CIT(A)/NFCA. In appeal, the CIT(A)/NFAC upheld the action of the Assessing Officer by observing as under:- “4. During the course of appeal proceedings, hearing notice was sent on 07.10.2024 wherein the appellant was asked to submit copies of the bank account and the sources for cash deposited into the account of 440, 441, 1089, 1092 & 1093/PUN/2025 the Society. In response, the appellant filed adjournment letter with a request to give two weeks' time to furnish the written submission. As per his request, the case was adjourned to 11.11.2024. On 11.11.2024, the appellant filed one Additional Grounds of Appeal
without any explanation regarding the sources for cash deposits. The Additional Grounds of Appeal submitted by the appellant is as under: Somnath Ramdas Jadhav DIN: ITBA/NFAC/F/APL 1/2024-25/1069487054(1) Appeal No: NFAC/2012-13/10267649 AY 2013
14. Additional Ground of Appeal
6. The learned AO-Ward 2, Ahmednagar erred in law and on facts assuming jurisdiction u/s 147 instead of section 153C of ITA, 1961 considering the convictions & information relied upon for making additions of Rs. 50,51,750/-. Appellant contends that, basis of addition in appellant's case is on account of Information pertaining appellant collected in search & seizure action at third party & hence, consequential proceedings pertaining to search & requisition ought to have been issued u/s 153C rather than 147 of the ITA, 1961. Place: Ahmednagar Date:11/11/2024 Somnath Ramdas Jadhav
5. The appellant, in addition to filing Additional Grounds, also requested to grant further adjournment. However, this cannot be accepted on the fact that the AO issued several notices and the appellant did not bother to file return of income and also did not respond to those notices issued during the course of assessment proceedings. He has also least bothered to file appeal within the statutory time limit. However, in the interest of natural justice, the delay is condoned and the appellant was given an opportunity during the course of appeal proceedings to furnish the sources of cash deposits. The appellant raised the issue of jurisdiction only in Additional Grounds of Appeal and not submitted any evidence in support of cash deposited. In view of the appeal is decided on merits.
6. Adjudication of Additional Grounds: 6.1 The appellant has raised the issue of assumption of jurisdiction in his Additional Grounds of Appeal
. It is to be mentioned here that as 440, 441, 1089, 1092 & 1093/PUN/2025 per Sec. 124(3) of the IT Act, no person shall be entitled to question the jurisdiction of AO after completion of assessment. In this connection, Sec. 124(3) of the IT Act is reproduced below: (3) No person shall be entitled to call in question the jurisdiction of an Assessing Officer- (a) where he has made a return 34 [under sub-section (1) of section 115WD or) under sub-section (1) of section 139, after the expiry of one month from the date on which (a) he was served with a notice under sub-section (1) of section 142 or [sub-section (2) of section 115WE or] sub-section (2) of section 143 or after the completion of the assessment, whichever is earlier; (b) where he has made no such retum, after the expiry of the time allowed by the notice under 35 [sub-section (2) of section 115WD or sub-section (1) of section 142 or under sub-section (1) of section 115WH or under section 148 for the making of the return or by the notice under the first proviso to section 115WF or under the first proviso to section 144] to show cause why the assessment should not be completed to the best of the judgment of the Assessing Officer, whichever is earlier, (c) where an action has been taken under section 132 or section 132A, after the expiry of one month from the date on which he was served with a notice under sub-section (1) of section 153A or sub-section (2) of section 153C or after the completion of the assessment, whichever is earlier.] 6.2 This has been upheld by Hon'ble Delhi High Court in the case of Abhishek Jain Vs. ITO, Ward-55(1), New Delhi [2018] 405 ITR
1. Further, Hon'ble High Court of Punjab & Haryana in the case of Subash Chander Vs. CIT, Rohtak [2008] 167 Taxmann 307 observed that, the appellant raised the issue of jurisdiction only before the CIT(A) and the Ld.CIT(A) opined that, it did not require any adjudication. This has been upheld by Hon'ble ITAT and later the Hon'ble High Court also upheld the same. 6.3 Recently, Hon'ble High Court of Karnataka in the case of Adarsh Developers Vs. DCIT [2024] 158 Taxmann.com 81 also upheld the same that the appellant cannot challenge the issue of jurisdiction after expiry of one month from the date on which the notice was served. In the present case, several notices were issued and the appellant did not respond all those statutory notices.
440, 441, 1089, 1092 & 1093/PUN/2025 6.4 Without prejudice to the above, the issue raised by the appellant in his additional grounds of appeal is not maintainable on the fact that the AO only received certain information that the appellant maintained an account with Shri Renuka Matha Multi-State Urban Co-operative Credit Society Ltd and deposited cash into that account. As the appellant did not file any return of income for the relevant AY, the AO reopened the assessment u/s 147 of the IT Act. The reasons recorded by the AO are as under. Brief details of assessee The above named assessee is having PAN. As per information available on records the assessee has carried out significant financial transactions, however, the assessee has not filed return of income.
2. Brief details of Information collected/received by the AO In this case as per the information received in category of High Risk Transaction CRIU/VRU Information on Insight Portal of the department, it is noticed that the assessee has entered into significant financial transactions as mentioned hereunder in Para 5
3. Analysis of information collected/received On perusal and analysis of information received from ACIT, Central Range 1(1), Mumbai disseminated through Insight portal, it is noticed that during the course of search & Seizure action u/s 132 of the IT Act, 1961 carried out in case of the M/s. Shri Renuka Mate Multi State Urban Co-operative Credit Society Ltd. (in short Society/SRMSCS) on 26.05.2017, it was found that the huge money was deposited in the bank accounts maintained in the society and during the course of assessment proceedings the society could not explain the source for the same. During this search action, it is further found that the assessee had maintained accounts in the society and entered into financial transactions exceeding the taxable limits. The assessee has undertaken transactions as per the details given in the following chart; however despite making these financial transactions the assessee has not truly and correctly disclosed the quantum of transactions done during the year under consideration.
4. Enquiries made by the AO as sequel to information collected/received Necessary verification was made from the entire details available on records and database of ITBA and ITD and therefore, I have sufficient form of 'Reason to believe' to frame my opinion. The information available with this office has been 440, 441, 1089, 1092 & 1093/PUN/2025 analyzed and I have framed my opinion after due application of all the facts and mind.
Finding of the AO During the year under consideration, assessee had undertaken following financial transactions: Sr. No. Type of transactions Amount 1. Deposited Cash in Account with 5051750 Shri Renukamata Multi State Urban Co-operative Credit Society Limited Total income escaping assessment 5051750 Thus, on perusal of the details available on record, it is noticed that during the previous year relevant to the assessment year under consideration, the assessee has undertaken financial transactions much beyond the taxable limit. However, the source of entering such huge transactions is not conclusively proved. Further, the assessee has not filed return of income, therefore the income to the above extent has escaped assessment.
Basis of forming reason to believe and details of escapement of income In light of the details available on records and the above facts and findings, I have reason to believe that income chargeable to tax quantified as above has escaped the assessment. Applicability of provisions of section 147/151 to the facts of the case.
Considering all the details and materials available on records, it is clear that the assessee was having taxable income; however, the assessee has not filed return of income and therefore the income chargeable to tax for Rs. 5051750/- has escaped the assessment. I have reasons to believe that this is a fit case for reopening and there is escapement of income within the meaning of Explanation 2(a) to Section 147 of the Income Tax Act, 1961. 6.5 There is no dispute that appellant had maintained an account with Shri Renuka Matha Multi-State Urban Co-operative Credit Society Ltd. and deposited huge amount of cash into that account. However, upon verification, it is noticed that he did not file any return 440, 441, 1089, 1092 & 1093/PUN/2025 of income for the relevant assessment year. Hence, on the basis of that information, reasons were recorded by the AO and notice u/s 148 of the IT Act was issued on 31.03.2021. Hence, assumption of jurisdiction by the AO u/s 147 of the IT Act was well within the scope of Sec.
Accordingly, this Additional Ground is not maintainable and dismissed.
7. Decision on Ground Nos. 1 to 4: 7.1 As discussed earlier, the appellant did not file any return of income in response to the notice issued u/s 148 of the IT Act. If we go through the grounds of appeal, it is seen that the appellant did not dispute the cash deposit of Rs.50,51,750/- in the relevant assessment year. His only ground was that entire credits into the bank account cannot be treated as undisclosed income and it was out of past withdrawals, past savings and gifts from relatives. As per the appellant, the AO ought to have granted the benefit of telescoping. No one has prevented the appellant in submitting the evidences in support of his claim made in the Grounds of Appeal. It is for this reason, several notices were issued the course of assessment proceedings and further opportunity was given during the course of appeal proceedings. The appellant, after taking adjournment, filed only Additional Grounds of Appeal and did not furnish the copy of the bank account and the sources for cash deposit. It is to be mentioned here that the appeal has been filed a delay of 480 days. In spite of such inordinate delay, the delay in filing is condoned as per the principles of natural justice. 7.2 The appellant, instead of availing the opportunity to explain the sources for cash deposits, wanted to thrash the entire reassessment proceedings by challenging the assumption of jurisdiction in spite of knowing that it is not maintainable in accordance with law. This attitude of the appellant clearly demonstrated that he had evaded tax by not filing the return of income within the due date specified u/s 139(1) of the IT Act and also after receipt of notice u/s 148 of the IT Act. It is further demonstrated that the appellant did not have any evidence in support of past savings, earlier withdrawal and gift from relatives. In spite of the facts discussed above, one more notice dated 25.11.2024 was issued to the appellant by posting the case on 10.12.2024 wherein the appellant was asked to submit ground wise written submission. The appellant once again raised the issue of assumption of jurisdiction without substantiating the source of cash deposit. He has also failed to give any evidence in support of business activities carried out by him. 7.3 In the written submission, the appellant has requested for hearing through VC. As per the request of the appellant, letter granting opportunity for the VC was given vide notice dated: 11.12.2024 by posting the case on 18.12.2024. However, he did not bother to respond to that notice. Hence, it is evident that, even that request was made just 440, 441, 1089, 1092 & 1093/PUN/2025 for formality. In the present case, the appellant failed to give any evidence in support of the cash deposited into the bank account. In the absence of any such document to explain the sources of cash deposits, I uphold the addition made by the AO and dismiss Ground Nos. 1 to 4.
As a result, this appeal is dismissed.”
6. Aggrieved with such order of Ld. CIT(A)/NFAC, the assessee is in appeal before this Tribunal.
7. Ld. AR appearing from side of the assessee submitted before us that the order passed by Ld. CIT(A)/NFCA is unjustified. Ld. AR submitted before us that under identical facts and similar circumstances a coordinate bench of this Tribunal in the case of Vijaykumar Mangilal Chordiya vs. NFAC, in order dated 19.09.2024 has allowed the appeal of the assessee by holding that the case was reopened on the basis of information that emerged at the time of search at the premises of M/s. Shri Renuka Mata Multistate Credit Society Ltd. therefore, the proper course of action by the Assessing Officer should have been under the provisions of section 153C and not under the provisions of section 147 of the Act. Accordingly, Ld. AR prayed before the Bench to set-aside the order passed by Ld. CIT(A)/NFAC and quash the assessment order passed u/s 147 r.w.s. 144 of the Act by the Assessing Officer.
440, 441, 1089, 1092 & 1093/PUN/2025 8. Ld. DR appearing from side of the Revenue relied on the orders passed by the subordinate authorities and requested to confirm the same. Ld. DR also furnished written submission in support of his contentions.
We have heard Ld. Counsels from both the side and perused the material available on record including the paper book and case laws furnished by the both the parties. In this regard, we find that the case of the assessee was reopened u/s 147 of the Act on the basis of information emerged at the time of search action carried out at the premises of M/s. Shri Renuka Mata Multistate Credit Society Ltd.. In first appeal, apart from regular grounds, the assessee raised an additional ground challenging the reopening u/s 147 of the Act by claiming that the proper course of action was assessment u/s 153C of the Act instead of u/s 147/148 of the Act. Being unsatisfied with the grounds of the assessee, Ld. CIT(A)/NFAC dismissed the appeal filed by the assessee and rejected the additional ground as well as regular grounds on merits.
It was the contention of Ld. Counsel of the assessee that under identical facts and similar circumstances a coordinate bench of this Tribunal in the case of Vijaykumar Mangilal Chordiya vs. NFAC, in 440, 441, 1089, 1092 & 1093/PUN/2025 order dated 19.09.2024 has allowed the appeal of the assessee by observing as under :- “14. We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the Assessing Officer on the basis of information available that the assessee has deposited cash of Rs.3,16,38,294/- in M/s. Shri Renuka Mata Multistate Credit Society Ltd. in which search and seizure operation was carried out on 26.05.2017, reopened the assessment u/s 147 of the Act, reasons of which are already reproduced in the preceding paragraphs. It is the submission of the assessee through the additional ground that since the information came to light during the course of search in the case of M/s. Shri Renuka Mata Multistate Credit Society Ltd., the proper course of action should have been invoking the provisions of section 153C of the Act and not the provisions of section 147 of the Act.
We find some force in the above arguments of the Ld. Counsel for the assessee. We find an identical issue had come up before the Tribunal in the case of ITO vs. Narendra Sampatlal Bafna vide order dated 19.08.2024 for assessment year 2017- 18. We find the Tribunal after considering the various decisions has held that in such a situation the proper course of action should be the provisions of section 153C of the Act and not section 147 of the Act. The relevant observations of the Tribunal from para 16 to 22 of the order read as under: “16. We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC and the paper book filed by both the sides. We have also considered the various decisions cited before us. We find the Assessing Officer, on the basis of information available that the assessee has taken cash loan of Rs.6,20,00,000/- from various persons through Shri Sachin Nahar, who made a statement u/s 132(4) of the Act to this effect during the course of search proceedings at his premises and on the basis of entries found in the loose sheets and other books of account maintained by him, reopened the assessment u/s 147 of the Act after recording reasons which have already been reproduced earlier. Since the assessee could not give any satisfactory explanation regarding the loan of Rs.6,20,00,000/- provided by Shri Sachin Nahar, the Assessing Officer, invoking the provisions of section 69A of the Act read with section 115BBE made addition to the total income 440, 441, 1089, 1092 & 1093/PUN/2025 of the assessee. We find the CIT(A) / NFAC quashed the re- assessment proceedings holding that the proper course of action before the Assessing Officer should have been u/s 153C of the Act. He also deleted the addition on merit by holding that the said addition was made merely on the basis of the statement recorded u/s 132(4) of the Act of Shri Sachin Nahar and no other corroborative material or evidence was available with the Assessing Officer. Further, despite two reminders, the Assessing Officer could not supply any evidence to the CIT(A) / NFAC regarding the existence of such material before him based on which the addition was made.
So far as the first issue raised by the Revenue in the grounds of appeal challenging the order of the CIT(A) / NFAC in quashing the re-assessment proceedings are concerned, we find that the case of the assessee was reopened on the basis of information received from the DCIT, Central Circle – 1, Pune according to which details emerged during the statement recorded u/s 132(4) of the Act of Shri Sachin Nahar and during search and post search enquiries by the Investigation wing and also during the course of enquiries conducted during search proceedings by the Central Circle – 1(1), Pune that the assessee has received cash loan of Rs.6,20,00,000/- through Shri Sachin Nahar. Further, the various documents, note books, note pads and loose sheets found during the course of search contained the business details of Shri Sachin Nahar. The provisions of section 153C of the Act read as under: “153C. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,— (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153A, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person in accordance with the provisions of section 153A, if, that Assessing Officer is satisfied that the books of account or 440, 441, 1089, 1092 & 1093/PUN/2025 documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and for the relevant assessment year or years referred to in sub-section (1) of section 153A : ……………..”
18. A perusal of the above provisions shows that the same is applicable if any money, bullion, jewellery or other valuable article or thing seized or requisitioned belongs to or any books of account or documents seized or requisitioned pertains or pertain to or any information contained therein relates to a person other than the person referred to in section 153A, then the books of account or documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and issue notice and assess or re-assess the income of the other person in accordance with the provisions of section 153A of the Act (emphasis supplied by us).
In the instant case, the reopening of the assessment was based on the basis of information that emerged from the statement of Shri Sachin Nahar u/s 132(4) and on the basis of details of notings in his money lending business which contained the name of the assessee as stated by the Assessing Officer. We find the letter No.Pn/DCIT/Cen.Cir.1(1)/Sharing of lnfo./2020- 21/dated 05.03.2021 of ACIT Central Circle 1(1), Pune addressed to the Income Tax Officer, Ward 1, Ahmednagar which reads as under: "To The Income Tax Officer, Ward 1, Ahmednagar Sub: Sharing of Information in the case of Shri Sachin Nahar -reg. Ref: This office letter No. Pn/DCIT/CC 1(1)/Info./2019-20 dated 10.06.2019 Reference may kindly be made to this office letter No. Pn/DCIT/CC 1(1)/Info./2019-20 dated 10.06.2019 vide which information about the cash loan was provided to you. In the case of Shri Sachin Nahar, Search was carried out on 04/08/2017, wherein Shri Sachin Nahar has admitted that various parties have taken cash loans from other parties through him, since he 440, 441, 1089, 1092 & 1093/PUN/2025 was a broker between these two parties, Shri Sachin Nahar has received commission for this transaction. The details of the parties who have taken cash loans have been obtained from Shri Sachin Nahar. There is also a mention of these persons in the seized documents (copy enclosed).
The case of NARENDRA BAFNA (PAN: AAVPB7561N), who has taken cash loan from various parties through Shri Sachin Nahar, pertains to your charge. The copy of statement recorded u/s. 132(4) of the IT Act, 1961 on 04.08.2017 of Shri Sachin Nahar as well as related documents regarding cash loan taken by the party along with the related pages of Shri Sachin Nahar's submission containing name of the above mentioned person and the Assessment Years in which the transactions were made are enclosed herewith for reference and necessary action at your end."
We find the Assessing Officer at para 2 of the reasons recorded has mentioned as under: “During search at his residence, various notebooks, notepad and loose papers were found and seized as Bundle No 1 to 28. In his statement recorded u/s. 132(4) of the Act at his residence on 02.08.2017, Shri Sachin Nahar stated that this seized material contain details of his money lending business in Cash and the Notings therein are related to Principal amount lent by lenders & borrowed by borrowers, names of lenders & borrowers, interest component etc. In the said seized registers, there are two types of notings, one which contains the accounts of borrowers and other registers contain notings of names of investors (depositors) in coded words. Here it is important to mention that Sachin Nahar used to write the name of investors and borrowers in certain coded words. Further the amounts mentioned in the seized documents are short by three zeros. For example for amount 100000, the noting is made 100 in seized registers.”
From the above it is clear that certain documents were seized from the premises of Shri Sachin Nahar which contained information relating to the present assessee. Therefore, the provisions of section 153C are applicable as according to the said section, it is applicable if any information contained in the seized document relates to the assessee.
Under these circumstances and in view of the detailed reasoning given by the CIT(A) / NFAC based on various decisions, we uphold the order of the Ld. CIT(A) / NFAC that the 440, 441, 1089, 1092 & 1093/PUN/2025 reopening of the assessment u/s 147 was not valid and the proper course of action that should have been taken by the Assessing Officer was u/s 153C as the provisions of section 153C of the Act are clearly applicable to the facts of the case. We, therefore, uphold the order of the CIT(A) / NFAC on the issue of validity of re-assessment proceedings. The first issue raised by the Revenue is accordingly dismissed.”
Since admittedly the Assessing Officer in the instant case has reopened the assessment on the basis of information that emerged at the time of search at the premises of M/s. Shri Renuka Mata Multistate Credit Society Ltd., therefore, the proper course of action by the Assessing Officer should have been under the provisions of section 153C and not under the provisions of section 147 of the Act. Therefore, we hold that the initiation of provisions of section 147 are not in accordance with law and liable to be quashed. In this view of the matter, we allow the additional ground raised
by the assessee challenging the validity of re-assessment proceedings and quash the assessment made u/s 147 r.w.s. 143(3) of the Act instead of 153C of the Act. The additional ground raised by the assessee is accordingly allowed.
17. Since the assessee succeeds on the legal ground, the grounds challenging on the merit of the issue becomes academic in nature and are not being adjudicated.
18. In the result, the appeal filed by the assessee is allowed.”
11. Respectfully following the above decision passed in the case of Vijaykumar Mangilal Chordiya (supra), we are of the considered opinion that in the instant case in hand the proper course of action by the Assessing Officer should have been under the provisions of section 153C of the Act and not under the provisions of section 147 of the Act. Since admittedly the Assessing Officer in the instant case has reopened the assessment on the basis of information that emerged at the time of search action u/s 132 of the Act at the 440, 441, 1089, 1092 & 1093/PUN/2025 premises of M/s. Shri Renuka Mata Multistate Credit Society Ltd.. Therefore, we hold that the initiation of proceedings u/s 147 of the Act in the instant case in hand are not in accordance with law and liable to be quashed. In this view of the matter, we allow the legal ground no.4 with regard to the validity of reassessment proceedings and quash the assessment order dated 21.03.2022 passed u/s 147 r.w.s. 143(3) of the Act for assessment year 2013-14. Thus, the ground no.4 raised by the assessee is allowed.
Since the assessee succeeds on the legal ground, the grounds challenging on the merit of the issue becomes academic in nature and are not being adjudicated.
In the result, the appeal filed by the assessee in A.Y. 2013-14 is allowed.
& 441/PUN/2025, A.Ys. 2015-16 & 2016-17: 14. Since the facts and issues involved in the appeal of the assessee for the assessment year 2013-14 are identical to the facts of the case for assessment years 2015-16 & 2016-17, therefore, our decision in A.Y. 2013-14 shall apply mutatis mutandis to these appeals of the assessee in & 440, 441, 1089, 1092 & 1093/PUN/2025 441/PUN/2025 for A.Ys. 2015-16 & 2016-17. Accordingly, the appeals of the assessee in & 441/PUN/2025 for A.Ys. 2015-16 & 2016-17 are also allowed. ITA No.1092/PUN/2025, A.Y. 2013-14 : 15. Since we have already quashed the quantum assessment order which formed the very basis for levy of penalty u/s 271(1)(c) of the Act, the above penalty does not survive. Consequently, the penalty u/s 271(1)(c) of the Act is hereby deleted. Accordingly, the appeal in ITA No.1092/PUN/2025 for A.Y. 2013-14 involving the issue of penalty u/s 271(1)(c) of the Act is allowed. ITA Nos.1089 & 1093/PUN/2025, A.Ys. 2015-16 & 2016-17: 16. Since the facts and issues involved in the appeal of the assessee for the assessment year 2013-14 are identical to the facts of the case for assessment years 2015-16 & 2016-17, therefore, our decision in ITA No.1092/PUN/2025 for A.Y. 2013-14 shall apply mutatis mutandis to these appeals of the assessee in ITA Nos.1089 & 1093/PUN/2025 for A.Ys. 2015-16 & 2016-17 involving the issue of penalty u/s 271(1)(c) of the Act. Accordingly, the appeals