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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM & HON’BLE SHRI MANU KUMAR GIRI, JM
आयकर अपीलीय अिधकरण ‘ए’ "ायपीठ चे"ई म"। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI माननीय +ी मनोज कुमार अ/वाल ,लेखा सद4 एवं माननीय +ी मनु कुमार िग7र, "ाियक सद4 के सम8। BEFORE HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM AND HON’BLE SHRI MANU KUMAR GIRI, JM आयकरअपील सं./ (िनधा9रणवष9 / Assessment Year: 2012-13) Ms. Juby Benny ITO बनाम/ 274, 5th Street, Non- Corporate Ward 2(5), Vs. K.K. Pudur, Coimbatore – 641 038. Coimbatore. "थायीलेखासं./जीआइआरसं./PAN/GIR No. AEBPJ-4432-N (अपीलाथ"/Appellant) : (" थ" / Respondent) अपीलाथ" कीओरसे/ Appellant by : Shri D.Anand (Advocate) for Mr.T.Vasudevan (Advocate) - Ld.AR " थ"कीओरसे/Respondent by : Shri AR V Sreenivasan (Addl.CIT)-Ld. Sr. DR सुनवाई की तारीख/Date of Hearing : 30-04-2024 घोषणा की तारीख /Date of Pronouncement : 02-05-2024 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member)
The grievance of the assessee in the captioned appeal is confirmation of addition of Rs.21.55 Lacs on account of low gross profit. The assessee also assails reassessment jurisdiction on merits. Upon perusal of assessment order dated 24.12.2019, it could be seen that the case of the assessee has been reopened by issue of notice u/s 148 on 15.03.2019. The perusal of show-cause notice dated 13.12.2019 as extracted in assessment order would show that the case has been reopened on the pretext that the assessee has shown low gross profit.
Though the assessee assailed reassessment proceedings, Ld. AO estimated Gross Profit @5% instead of 1.85% as reflected by the assessee and added differential of Rs.21.55 Lacs to the income of the assessee.
During appellate proceedings, the assessee reiterated that the reopening has been done merely on ‘reasons to suspect’ rather than ‘reasons to believe’. The Ld. CIT(A) rejected the legal ground and also confirmed estimation of gross profit. Aggrieved, the assessee is in further appeal before us.
We are of the considered opinion that the case could be reopened only if Ld. AO has reasons to believe that certain income has escaped assessment. The reopening cannot be resorted only on suspicion that the assessee has reflected low gross profit. The Ld. AO should have some tangible material to arrive at such a conclusion. In the present case, the essential ingredients to reopen the case are clearly missing and therefore, we have no hesitation in quashing the assessment order. Consequently, delving into merits of the case has been rendered mere academic in nature.
The appeal stand allowed. Order pronounced on 2nd May, 2024 (MANU KUMAR GIRI) (MANOJ KUMAR AGGARWAL) "ाियक सद4 / JUDICIAL MEMBER लेखा सद4 / ACCOUNTANT MEMBER चे3ई Chennai; िदनांक Dated : 02-05-2024 DS आदेशकीNितिलिपअ/ेिषत/Copy of the Order forwarded to : 1. अपीलाथ"/Appellant 2. " थ"/Respondent 3. आयकरआयु</CIT 4. िवभागीय"ितिनिध/DR 5. गाडAफाईल/GF