SH. ASHOK AMBWANI,NEW DELHI vs. ITO, NEW DELHI

Ground Nos.1 to 4 of the assessee’s appeal are against the reopening of assessment u/s 147 of the Income-tax Act, 1961.

At the time of hearing before us, it is submitted by the learned counsel that this issue is now squarely covered in favour of the assessee by the decision of ITAT Delhi Bench in the case of Jiten Gurnani Vs. ITO vide order dated 31st March, 2015. He pointed out that the assessment of the assessee has been reopened on the basis of information received from DDIT (Investigation) wherein it was informed that Shri Harish Pawar is an entry provider and he has admitted to have given entries to various

2 ITA-186/Del/2013 persons. That on the basis of same statement of Shri Harish Pawar, the case of Jiten Gurnani was reopened. However, ITAT, after considering the facts of the case and relying upon the decision of Hon'ble Jurisdictional High Court in the case of CIT Vs. Pradeep Kumar Gupta – 303 ITR 95, held that on the basis of those facts, reassessment was legally unsustainable. He furnished the copy of reasons recorded in the case of Jiten Gurnani and compared the same with the reasons recorded in the case of the assessee and pointed out that identical reasons were recorded in the case of Jiten Gurnani. He also relied upon the decision of Hon'ble Jurisdictional High Court in the case of Pr.Commissioner of Income Tax-4 Vs. G & G Pharma India Ltd. vide dated 8th October, 2015.

Learned DR, on the other hand, relied upon the orders of authorities below and he stated that the assessment was reopened on the basis of specific information.

We have carefully considered the submissions of both the sides and perused the material placed before us. On a perusal of the reasons recorded in the case of the assessee as well as Jiten Gurnani, we find that identical reasons were recorded for reopening of assessment in both the cases. Both the assessments were reopened on the basis of statement of Shri Harish Pawar. Therefore, the case of the assessee is squarely covered by the decision of ITAT Delhi ‘D’ Bench in the case of Jiten Gurnani (supra). On these facts, the decision of Hon'ble Jurisdictional High Court in the case of Pradeep Kumar Gupta (supra) and G & G Pharma India Ltd. (supra) would be squarely applicable. The Assessing Officer has only referred to the information received from DDIT (Investigation). However, he has not discussed what has been disclosed by the assessee in his books of account and how on the basis of the information received from DDIT (Investigation), a prima-facie view of escapement of income can be formed in the case of the assessee. The Assessing Officer has not discussed the nature of 3 ITA-186/Del/2013 the credit in the case of the assessee, whether it is in the form of loan, share capital, gift etc. The Assessing Officer mechanically reopened the case just on the basis of information received from DDIT without application of independent mind with reference to the facts of the assessee’s case. In view of the above, we, respectfully following the decision of Hon'ble Jurisdictional High Court in the case of Pradeep Kumar Gupta (supra), G & G Pharma India Ltd. (supra) and the decision of ITAT Delhi ‘D’ Bench in the case of Jiten Gurnani (supra), hold that the reopening of assessment was not valid. Accordingly, the notice issued u/s 148 of the Act is quashed and consequentially, the assessment order passed in pursuance to such notice is also quashed. Once the assessment order itself has been quashed, the other grounds of the assessee’s appeal wherein the assessee has challenged the additions made in the assessment order do not survive for adjudication.

In the result, the appeal of the assessee is allowed. Decision pronounced in the open Court on 04.05.2016.