BASANT JAIN,C - SHIVAJI PARK vs. DCIT, CENTRAL CIRCLE 29, JHANDEWALLAN

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ITA 2725/DEL/2023Status: DisposedITAT Delhi17 November 2023AY 2012-13Bench: Dr. B. R. R. Kumar (Accountant Member)3 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the AO had not applied their mind to the basic fact of whether a return was filed, leading to a flawed reopening. Consequently, the notice issued for reassessment was quashed, and the assessment order was deemed void ab initio.

What were the facts?

The Assessing Officer (AO) initiated reassessment proceedings under Section 147 for AY 2012-13, citing that the assessee had not filed a return of income. However, the AO's reasoning contained contradictory statements regarding whether a return was filed and processed.

What were the issues?

Whether the reopening of assessment was valid when the Assessing Officer had contradictory findings on whether the assessee had filed a return of income.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 151,Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, DELHI

Before: Dr. B. R. R. Kumar

For Appellant: Shri R.S. Singhvi, CA, Shri Satyajeet Goel, CA
For Respondent: Shri Atiq Ahmed, Sr. DR
Hearing: 14.11.2023Pronounced: 16.11.2023

ORDER Per Dr. B. R. R. Kumar, AM:- The present appeal has been filed by the assessee against the order of Ld. CIT(A)-30, Delhi dated 25.07.2023.

2.

Heard the arguments of both the parties and perused the material available on record.

3.

The reasons recorded by the Assessing Officer while issuing of notice u/s. 148 is as under:-

1………. The assessee is also proprietor in firm M/s Jainsons Jewellers situated at Kachay Quarter, Sonepat. The assessee didn’t file his return of income for AY 2012-13, and also remains non-filer for AY 2013-14 and AY 2014-15. Therefore, no regular assessment was made.

Basant Jain 7(i) In this case no return of income was filed for the year under consideration, Also, no scrutiny assessment under the Act for the year under consideration was made. Accordingly, in this case, the only requirement to initiate proceedings u/s 147 is reason to believe which has been recorded above (refer paragraphs 1 to 6).

7(ii) It is pertinent to mention here that in this case the assessee has filed return of income for the year under consideration but no assessment as stipulated u/s 2(40) of the Act was made and the return of income was only processed u/s 143(1) of the Act. In view of the above, provisions of clause (b) of Explanation 2 to section 147 are applicable to facts of this case and the assessment year under consideration is deemed to be a case where income chargeable to tax has escaped assessment.

7(iii) This case is within six years from the end of the assessment year under consideration. Approval for issuance of notice j/s 148 for A.Y. 2012-13 is solicited in accordance with provisions of Sec. 151 of the Income Tax Act, 1961.

4.

From the above contradictory findings of the AO, we find that the Assessing Officer is not very sure of the basic fact, whether the assessee filed return of income or not, which goes to prove that the Revenue Authorities have not applied their mind to the very factum whether the return of income has been filed or not. Since the reopening of the case has been resorted to without application of mind, the notice issued is liable to be quashed. The assessment order passed is treated as void ab initio.

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