INCOME TAX OFFICER, JAIPUR vs. ABHILASHA JAIN, JAIPUR
Facts
The assessee filed her return of income for the assessment year 2010-11. The Assessing Officer (AO) reopened the case and made additions on account of commodity profit and commission paid, totaling Rs. 30,82,510/-. The assessee appealed to the CIT(A).
Held
The CIT(A) allowed the appeal, holding that the additions made by the AO were without jurisdiction. The CIT(A) relied on various High Court and ITAT judgments, stating that additions in reassessment proceedings can only be made based on the formation of belief on which the case was reopened, not on other transactions. The Tribunal upheld the CIT(A)'s order.
Key Issues
Whether the additions made by the AO were beyond the scope of reassessment proceedings and thus without jurisdiction.
Sections Cited
Section 147, Section 148, Section 143(2)
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Income Tax Appellate Tribunal, JAIPUR BENCHES,”SMC’’ JAIPUR
Before: Hon’ble SHRI SANDEEP GOSAINvk;dj vihy la-@ITA No.673/JP/2024
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC’’ JAIPUR Jh lanhi xkslkbZ] U;kf;d lnL; ds le{k BEFORE: Hon’ble SHRI SANDEEP GOSAIN, JUDICIAL MEMBER vk;dj vihy la-@ITA No.673/JP/2024 fu/kZkj.k o"kZ@Assessment Year : 2010-11 The ITO cuke Smt. Abhilasha Jain Vs. Ward 6(3) SB-107C, Sethi House Jaipur Lal Kothi, Tonk Road, Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AIRPG 2820 P vihykFkhZ@Appellant izR;FkhZ@Respondent jktLo dh vksj ls@Revenue by: Mrs. Monisha Choudhary, Addl. CIT-DR fu/kZkfjrh dh vksj ls@Assessee by : Shri P.C. Parwal, CA lquokbZ dh rkjh[k@Date of Hearing : 11/07/2024 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 22/08/2024 vkns'k@ORDER PER: SANDEEP GOSAIN, JM This appeal filed by the Revenue is directed against order of the CIT(A)-4, Jaipur dated 07-02-2024 for the assessment year 2010-11 raising therein following grounds of appeal. ‘’(i) "On the facts and in the circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition without appreciating the facts that the reasons were recorded for taking bogus accommodation entry by misused of NMCE platform and addition was also made on transaction done on NMCE platform which was misused for booking bogus loss/profit."
2 ITA NO.673/JP/2024 INCOME TAX OFFICER, WARD 6(3), JAIPUR VS ABHILASHA JAIN, JAIPUR 2 "On the facts and in the circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs.23,40,518/- made on account of commodity profit without considering the fact that the profit of Rs.23,40,518/- in commodity transaction is factitious in nature". 3 "On the facts and in the circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs.46,810/- made on account of commission paid without considering the fact that the assessee had paid the commission on the alleged accommodation profits."
2.1 Brief facts of the case are the assessee had filed her return of income on 13- 10-2010 at Rs.13,35,170/-. The case was reopened by invoking the provisions of Section 147 of the Act after recording the reasons and proceedings u/s 147 of the Act was initiated in this case after getting approval of the competent authority. Notice u/s 148 of the Act was issued on 28-03-2017. In response to notice u/s 148 of the Act, the ld. AR of the assesee submitted copy of ITR filed on17-04-2017. Further the AO had issued notice u/s 143(2) on 22-06-2017. Finally the AO completed the assessment vide order dated 20-12-2017 at a total income of Rs.30,82,510/- by making an addition of Rs.23,40,518/- on account of commodity profit and addition of Rs.46,810/- on account of commission paid. 2.2 Aggrieved by the order of the order of the AO, the assessee carried the matter before the ld. CIT(A) who allowed the appeal of the assesee with the observations at para 4.2 and 5.2 of his order that the addition made in the
3 ITA NO.673/JP/2024 INCOME TAX OFFICER, WARD 6(3), JAIPUR VS ABHILASHA JAIN, JAIPUR assessment order is without jurisdiction. The relevant observations of the ld. CIT(A) are mentioned as under:- ‘’4.2…….In the assessment order the addition has not been done on the basis of formation of believe for the reasons of reopening. The addition has been done with respect to other transactions. Respectfully following the judgement of Hon’ble Delhi High Court in the case of Ranbaxy Laboratories Ltd vs CIT [2011] 12 taxmann.com 74 (Delhi)/2011 200 Taxman 242 (Delhi)/[2022] 336 ITR 136 (Delhi)/[2011] 242 CTR 117 (Delhi) [03-06-2011], Hon’ble Bomaby High Court in the case of Commissioner of Income- tax-5, Mumbai v. Jet Airways (I) Ltd. [2010] 195 Taxman 117 (Bombay)/[2011] 331 ITR 236 (Bombay)/[2011] 239 CTR 183 (Bombay)[12-04- 2010] and Hon'ble ITAT, Jaipur Bench in the case of Assistant Commissioner of Income-tax, Circle-7, Jaipur v. M.K. Exim (India) Ltd., it is hereby held that the addition made in the assessment order is without jurisdiction as other additions can be made in the reassessment proceedings only when the addition has been made on basis of formation of believe on which the case of the taxpayer is reopened. Accordingly, this ground of appeal is hereby allowed.’’ 5.2 I have considered the facts of the case and written submissions of the appellant as against the observations/findings of the AO in the assessment order for the year under consideration. The contentions/submissions of the appellant are being discussed and decided as under:- In this order the addition made in the assessment order has been held to be without jurisdiction following the judgments of Hon'ble High Courts and Hon'ble Tribunal. Once the additions stand deleted on technical ground, the adjudication of the same on the merits is rendered merely academic and does not require detailed adjudication. In view of this discussion this ground of Appeal of the appellant is treated as disposed off.’’ 2.3 During the course of hearing, the ld. DR supported the order of the AO. 2.4 On the other hand, the ld. AR of the assessee supported the order of the ld CIT(A) 2.5 The Bench has heard both the parties and perused the materials available on record. It is not imperative to repeat the facts of the case as the ld. CIT(A) has
4 ITA NO.673/JP/2024 INCOME TAX OFFICER, WARD 6(3), JAIPUR VS ABHILASHA JAIN, JAIPUR explicitly dealt with the above issues. It is also noticed that the ld. DR has not filed any contrary documents relating to the issue as mentioned hereinabove except relying upon the order of the AO. In this situation, the Bench taking into consideration the facts and circumstances of the case feels that it does not find any infirmity in order of the ld. CIT(A) and the same is sustained. Thus the appeal of the Department is dismissed. In the result, the appeal of the Department is dismissed with no order as to 3.0 costs.
Order pronounced in the open court on 22 /08/2024.
Sd/- ¼lanhi xkslkbZ½ (Sandeep Gosain) U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 22/08/2024 *Mishra आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- The ITO, Ward 6(3), Jaipur 2. izR;FkhZ@ The Respondent- Smt. Abhilasha Jain, Jaipur 3. vk;dj vk;qDr@ The ld CIT 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 673/JP/2024) vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेजज. त्महपेजतंत
