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Facts
The assessee's appeal for AY 2015-16 challenged a reopening of assessment initiated under Section 147 of the Income Tax Act, 1961, by the National Faceless Appeal Centre (NFAC). The Assessing Officer had reopened the case based on departmental information, despite the assessee's taxable income of Rs. 52.60 lakhs for the said year already being assessed under Section 143(3) on 22.11.2017. The core issue revolved around the validity of the reopening initiated under Section 148/147.
Held
The Tribunal held that the Assessing Officer's reasons for reopening the assessment were based on mere doubt rather than tangible material, which is not sustainable in law for an assessment already completed under Section 143(3). Citing CIT v. Insecticides India Ltd., the Tribunal concluded that such a reopening was invalid and accordingly quashed it. Consequently, all other pleadings on the merits of the case became academic.
Key Issues
Whether the reopening of assessment under Section 147/148 was valid when it was based on 'mere doubt' rather than 'tangible material' after an assessment under Section 143(3) had already been completed.
Sections Cited
Section 147, Section 148, Section 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’ NEW DELHI
Before: SHRI SATBEER SINGH GODARA
O R D E R PER SATBEER SINGH GODARA, JM:
This assessee’s appeal for assessment year 2015-16 arises against National Faceless Appeal Centre (NFAC), Delhi’s DIN and order no. ITBA/NFAC/S/250/2023-24/1063750276(1), dated 31.03.2024, in case no. NFAC/2014-15/10119326, in proceedings u/s 147 of the Income-tax Act, 1961, hereinafter referred to as the ‘Act’.
Case called twice. None appears at the assessee’s behest. It is accordingly proceeded ex parte.
I advert to first and foremost issue of validity of section 148/147 reopening itself going to root of the matter which had been initiated by the learned Assessing Officer going by the information received from departmental sources.
It is noticed from page 2 in the assessment order that the said reasons recorded by the Assessing Officer are mere in the nature of a doubt than those based on tangible material that assessee’s taxable income of Rs.52.60 lakhs, which had already been assessed in section 143(3) assessment dated 22.11.2017, liable to be assessed had escaped assessment. This being the clinching case, I hereby quote CIT v. Insecticides India Ltd. (2013) 357 ITR 330 (Delhi) that such a reopening initiated by the learned Assessing Officer is not sustainable in law. It is accordingly quashed. All other pleadings on merits stand rendered academic.
This assessee’s appeal is allowed in above terms.
Order pronounced in open court on 29.11.2024.