VITHAL LEASEFIN(P) LTD ,MUMBAI vs. DCIT, CIRCLE WARD 1(3)(2), MUMBAI

None appeared on behalf of the assessee, when the case was called repeatedly. From the file, we observed that the notice of the present appeal for hearing was already issued to the assessee through RPAD and also through e-mail id. kkirannco@gmail.com as per the report of registry. Since the notice was issued on the address furnished by the assessee and 30 days have already been alapsed from the date of issuance of notice

We have heard Ld. DR and perused the material placed on record. As per the facts of the present case the assessee company had filed its original return of income on 16. 10.2012 declaring total income of Rs. 15,10,340. In response to notice U/s. 148 of the Act the assessee had filed return of income on 10.04.2019. Therefore AO issued notice U/s. 142 (1) of the Act and consequently after considering the case AO made addition in respect of deposits made to decent investment and finance private limited for Rs. 2,25,00,000 invoking provisions of section 68 of the Act as the source remained unexplained.

Aggrieved by the said order the assessee preferred appeal before Ld. CIT(A) which was dismissed and the operative portion of the order of Ld. CIT(A) is contained herein below: DECISION OF THE APPELLATE AUTHORITY: The contentions of both the Assessing officer and the Appellant assesseeresp. have been carefully considered and this Appellate authority has noted the following points: The assesseehad filed its return of income on 16.10.2012 declaring the total income of Rs. 15,10,340/-. The same was processed u/s. 143(1) of the Act on 14.03.2013. i. It came to the knowledge of the AO that, the assessee had given a loan Rs.2,25,00,000/- to M/s. Decent Investment & Finance Private Limited in F.Y 2011-12 (AY 2012-13) the source of which was suspicious or un-explained. Thus, the facts of the case show that, there was reason enough before the AO to consider the re-opening action u/s. 148 of the Act. Thus, placing reliance on the judgernent of the Hon'ble Supreme Court of India in its decision in the ACIT Vs. Tube Investments of India Ltd. (ITAT), Chennai-TM) 133 ITD 79 and M/S Rajat Export Import India Pvt. Ltd. Vs./ ITO(Delhi) 341 ITR 135, it is held that "What is necessary to reopen an assessment is not final verdict but a prima facie reason Once such a reason is recorded by the assessing authority he assumes jurisdiction to issue notice u/s 148". Hence, on the basis of such information, the Assessing Officer was justified in having a reason to believe that the income of assessee would have escaped assessment. The Hon'ble High Court of Bombay in the case of Export Credit relevant. The Hon'ble Supreme Court in the case of Raymond Woollen Mills Ltd v ITO 236 ITR 34(SC) has held that, in determining whether commencement of reassessment proceedings was valid, it has only to be seen whether there was prima facie some material on the basis of which the department could reopen the case, and that the sufficiency or correctness of the material is not a thing to be considered at the stage of reopening. Hence, the reopening of assessment cannot be held to be invalid. Thus, no illegality is found w.r.t the reopening proceedings in this case as such and any contentions in this regard from the appellant are thus untenable. iv. Thereafter, based on the said information the Assessing officer, after obtaining prior permission of the Pr.CIT-1, Mumbai, reopened the assessment of AY 2012-13 by issuing notice dated 30.03.2019 u/s. 148 of the I.T. Act. In response to the notice u/s. 148 of the Act dated 30.03.2018, the assessee filed the return of income of AY 2012-13 on 10.04.2019. Thereafter, reasons for reopening of the assessment were supplied to the assessee vide letter dated 23.10.2019. The assessee filed objection against the reopening of the assessment of A.Y 2012-13 vide letter dated NIL received in this office on 22.11.2019. The objections raised by the assessee were disposed-off by passing a speaking order dated 26.11.2019. A notice u/s. 143(2) of the It Act, 1961 was issued and duly served on assessee on 03.10.2019. Thereafter, notice/su/s. 142(1) of the Act etc. were issued to the assessee seeking such information. And such notice u/s. 142(1) of the Act dated 13.12.2019and SCN etc. were issued. V. The Assessing officer during the course of assessment proceedings sent various notices etc. to the assessee and gave the assessee opportunity to be heard and the assessee did not file such satisfactory submissions before the AO in response to the final show-cause notice. vi. After seeing the negligent behaviour of the assessee, the Assessing officer went ahead and made the addition for Rs. 2,25,00,000/- u/s. 68 of the Income Tax Act, 1961. vii. The appellant assessee has claimed that, "... The appellant strongly urges that the show- cause notice itself is bad in law because there could not be any addition for accounted loan given u/s. 68 of the Act. The appellant strongly urges that it had filed copy of audit report which gives comparative details for F. Y. 2010-11 & 2011-12. The appellant strongly urges that, if one looks into groupings of note no. 7, loan term loans and advances given which is reproduced for ready reference than it is apparent that the assessee had given loan to Grand rose Inf. Venture (P) Ltd and the same was returned during the year and against that a loan was mainly given to Decent Investment & Finance (P) Ltd. The relevant part of the audited accounts are reproduced as under. viii. u/s 142(1) dated 13/12/2019, the assessee did not file any details / explanation / documents. In the The AO in its Assessment order has clearly stated that, "However, in response to notice absence of any explanation along with any documentary evidences, the source of loan given to Mis Decent Investment & Finance Private Limited in F.Y 2011-12 cannot be held genuine. The burden of proof is on the assessee to explain satisfactory with regard to source of loan given in F.Y 2011-12 along with documentary evidences. Sufficient opportunity of was allowed to the assessee to prove the genuineness, however, the assessee failed. This is the duty of assessee to submit all the evidences in support of its claim...