SHO SINGH TYAGI,GHAZIABAD vs. ITO WARD-2(2)(3), GHAZIABAD

The brief facts leading to the case are that an AIR information was received that the assessee had deposited cash in his Saving Bank account maintained with Punjab National Bank during the year under consideration. During the year under consideration, the assessee has not filed any return of income. After recording the reasons and upon obtaining a prior approval from the PCIT, Ghaziabad, notice under Section 148 of the Act dated 26.03.2019 was issued and served upon the assessee. Subsequently, on 06.08.2019 notice under Section 142(1) was issued and following the other procedures the assessment was finalized upon making addition of the said cash deposit made by the assessee, since remained unexplained, in the hands of the assessee which was further confirmed by the First Appellate Authority. Hence, the instant appeal before us.

At the time of the hearing of the instant appeal, the Ld. Counsel appearing for the assessee submitted before us that while recording reasons the Ld. CIT(A) recorded incorrect fact and initiated proceeding under Section 148 of the Act. It was particularly recorded by the Ld. AO that the assessee has not filed return of income which is also reflecting from the assessment order dated 07.10.2019 whereas the assessee duly filed its return of income on 26.10.2012 for the year under consideration declaring Sho Singh Tyagi total income at Rs.1,81,607/-. In fact, reason recorded for reopening shows that the trigger for reopening of assessment was the purported failure on the part of the assessee to file return for the year under consideration which is not correct rather the assessee filed return long back on 26.10.2012 and therefore, the AO’s opinion that the aspect of cash deposit made by the assessee could not be verified because of non-filing of return of income is factually incorrect. In that view of the matter, the reason to believe recorded by the AO and the so called approval obtained from the superior is on the wrong finding of fact and thus, the same is liable to be quashed, as was the crux of the submission made by the Ld. A.R. In this regard, he has relied upon the judgment passed by the Hon’ble Delhi High Court in the case of Shri Tarlochan Lal Goel Vs. ACIT, CC-62(1) a copy whereof has also been submitted before us.