PURE DEPARTMENTAL STORE PVT. LTD.,NEW DELHI vs. DCIT, CIRCLE-11(1), NEW DELHI
In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal ruled that reopening assessment proceedings solely for the purpose of verification, especially when no verification was carried out during the initial assessment, is not legally sustainable. Citing High Court precedents, the Tribunal quashed the impugned reopening proceedings.
What were the facts?
The assessee filed four appeals challenging the validity of reopening proceedings initiated by the National Faceless Appeal Centre for assessment years 2013-14 to 2016-17. The reopening was based on the premise that credits under section 68 and income from undisclosed sources were not verified during the original assessment proceedings.
What were the issues?
Whether reopening of assessment under Section 147/148 is valid when the original assessment did not verify credits under Section 68, and the reopening is solely for verification.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cases cited in this judgment(2)Show listHide list
Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.
- PCIT v. Manzil Dinesh Kumar Shah24 citing454 ITR 755 · 2018 · HC
- Sunil Kumar Rastogi v. CIT15 citing406 ITR 306 · 2018 · HC
Income Tax Appellate Tribunal, DELHI BENCH “SMC”: NEW DELHI
Before: SHRI SATBEER SINGH GODARA
O R D E R PER SATBEER SINGH GODARA, JM:
These assessee’s four appeals - 2231, 2232 & 2234/Del/2023 for corresponding assessment years 2013-14, 2014-15, 2015-16 & 2016-17, arise against National Faceless Appeal Centre (INFAC), Delhi’s separate DIN and order nos. ITBA/NFAC/S/250/2023-24/1053622060(1), ITBA/NFAC/S/250/2023- 24/1053622137(1), ITBA/NFAC/S/250/2023-24/1053622174(1) and ITBA/NFAC/S/250/2023-24/1053622213(1), all dated 08.06.2023 in case nos.
CIT(A), Delhi-4/10276/2018-19, CIT(A), Delhi-4/10277/2018-19, CIT(A), Delhi- u/s 143(3) read with section 147 of the Income-tax Act, 1961, hereinafter referred to as the “Act”.
Heard both the parties at length. Case files perused.
It emerges at the outset that the first and foremost substantive issue that arises for the undersigned adjudication is that of validity of the impugned reopening itself wherein the learned assessing authority duly observes in it’s identical wordings that the credits forming subject matter of section 68 along with income from undisclosed source had not been verified in the course of normal assessment at any point.
The Revenue is indeed fair enough in not rebutting this clinching factual position emanating from the case files.
Faced with this situation, I hereby quote PCIT v. Manzil Dinesh Kumar Shah (2018) 406 ITR 306 (Guj.) and PCIT v. Maheshwari Devi (2023) 454 ITR 755 (Jharkhand) to conclude that such a recourse to 148/147 proceedings for the purpose of verification only is not sustainable in law. The impugned reopening stand quashed in very terms.
All other pleadings on merits stand rendered academic.
This assessee’s appeals are allowed in above terms. A copy of this common order be placed in the respective case files.
Order pronounced in open court on 21.11.2024.
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