“investigation wing”

ReassessmentSection 147Section 14712,584 judgments

The decision most relied on for investigation wing is Sarthak Securities Co. Pvt. Ltd. v. ITO (329 ITR 110), cited in 217 judgments on BharatTax.

Leading authorities on investigation wing

Sarthak Securities Co. Pvt. Ltd. v. ITO

329 ITR 110 · 2010 · High Court

217

citing judgments

Reassessment proceedings under Section 147 are invalid if the Assessing Officer records satisfaction based on borrowed satisfaction or information without independently applying their mind and forming their own 'reason to believe' that income has escaped assessment. The AO must arrive at an independent conclusion, not merely act on a report from an investigation wing without due diligence.

ITO, 19(3) (4) Mumbai v. Shamim M Bharwani

69 Taxmann.com 65 · 2016 · Reported

142

citing judgments

Long Term Capital Gains (LTCG) from penny stock transactions are liable to be treated as bogus and added back under Section 68 as unexplained cash credits, especially when evidence suggests the involvement of entry operators providing accommodation entries.

1. Harikishan S. Virmani v. DCIT

394 ITR 146 · 2017 · High Court

citing judgments

Reassessment proceedings under section 147 cannot be initiated by the Assessing Officer based on borrowed satisfaction, vague information from the Investigation Wing, or incorrect jurisdictional facts without independent application of mind. Reopening beyond four years from the end of the relevant assessment year, especially where an original assessment was completed under section 143(3), requires specific conditions relating to the assessee's failure to disclose material facts.

PCIT v. M/s. Kesoram Industries 57

417 ITR 334 · 2019 · High Court

citing judgments

An assessment completed under Section 143(3) cannot be reopened after four years solely based on third-party information or opinions, such as from an Investigation Wing, without the Assessing Officer applying their own independent mind to the material and having new, independent material on record.

ITO v. Purushottam Das Bangur

224 ITR 362 · 1997 · Supreme Court

citing judgments

Information received from the investigation wing constitutes valid 'reason to believe' for initiating reassessment proceedings under Sections 147/148, provided the Assessing Officer applies their mind to the material and does not act mechanically. Prompt issuance of a notice based on such information does not automatically imply a lack of due diligence or borrowed satisfaction.

AGR Investment v. Additional Commissioner

197 Taxmann 177 · 2011 · High Court

citing judgments

A reassessment under Section 147/148 is valid if initiated based on specific, non-vague information, even from an investigation wing, provided the Assessing Officer applies independent mind to form a 'reason to believe' that income has escaped assessment.

56 (Guj.) (para 6) v. Aaspas Multimedia Ltd. v. Dy. CIT

83 Taxmann.com 82 · 2017 · High Court

citing judgments

Information received from the Investigation Wing, identifying the assessee as a beneficiary of accommodation entries through share application from a third party, constitutes valid tangible material and 'reasons to believe' for initiating reassessment proceedings under Section 147 of the Income Tax Act.

Aradhna Estate Pvt. Ltd. v. DCIT

91 Taxmann.com 119 · 2018 · High Court

citing judgments

The Assessing Officer is justified in reopening assessment proceedings based on information received from the Investigation Wing, even when recording findings also rely on documents already on record, provided all procedural requirements for reassessment are met.

Judgments citing investigation wing

Metallica Tubes & Pipes Pvt Ltd., Mumbai vs. ITO-10(2)(4), Mumbai

In the result, appeal filed by the assessee is partly allowed and the revenue’s appeal is dismissed

ITA 4604/MUM/2019[2010-11]Status: DisposedITAT Mumbai26 Nov 2020AY 2010-11

Bench: Shri Shamim Yahya (Am) & Shri Ram Lal Negi (Jm) Assessment Year: 2010-11 M/S Metallica Tubes & Pipes Pvt. The Income Tax Officer- Ltd., Ward 10(2)(4) 106, Kanchanban, Dixit Road, Aayakar Bhavan, Vile Parle (E), Vs. Mumbai - 400020 Mumbai - 400057 Pan: Aafcm6609K (Appellant) (Respondent) Assessment Year: 2010-11 The Ito – 10(2)(4), M/S Metallica Tubes & Pipes R. No. 216-A, Aayakar Bhavan, Pvt. Ltd., M.K. Road, 106, Kanchanban, Dixit Road, Mumbai - 400020 Vs. Vile Parle (E), Mumbai - 400057 Pan: Aafcm6609K (Appellant) (Respondent)

For Appellant: Shri Haridas Bhat (AR)For Respondent: Shri Jeetendra Kumar (DR)

Section 115JSection 143Section 148

substantiate its purchase from the claimed supplier i.e. N B Enterprises, who had been already established hawala dealers from Sales Tax Department and investigation wing of the Income Tax Department. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred

M/S Mojika Real Estate & Developers Pvt. Ltd., Jaipur vs. Deputy Commissioner of Income Tax, Circle-3, Jaipur

In the result, the sole ground of appeal taken by the assessee is hereby dismissed

ITA 1429/JPR/2018[2014-15]Status: DisposedITAT Jaipur25 Nov 2020AY 2014-15

For Appellant: Sh. Manish Agarwal (CA)For Respondent: Sh. Ranjan Kumar (CIT)

Section 133ASection 133A(3)Section 145(3)

making any investigation or enquiry where even no proceedings under the Act are pending and normally exercised by the officers of the investigation wing and not by the officers of the assessment units. It has already been mentioned earlier that in its DCIT, Jaipur vs. M/s Mojika Real Estate & Developers

Deputy Commissioner of Income Tax, Circle-3, Jaipur vs. M/S Mojika Real Estate & Developers Pvt. Ltd., Jaipur

In the result, the sole ground of appeal taken by the assessee is hereby dismissed

ITA 1236/JPR/2018[2014-15]Status: DisposedITAT Jaipur25 Nov 2020AY 2014-15

For Appellant: Sh. Manish Agarwal (CA)For Respondent: Sh. Ranjan Kumar (CIT)

Section 133ASection 133A(3)Section 145(3)

Aash Trading Company Pvt. Ltd, Delhi vs. ITO Ward-1(2), New Delhi

In the result, the Assessee’s Appeal is allowed

ITA 4797/DEL/2019[2011-12]Status: DisposedITAT Delhi25 Nov 2020AY 2011-12

Bench: Shri H.S. Sidhu & Shri Prashant Maharishi(Through Video Conference) A.Y. : 2011-12

Section 147Section 148Section 68

aforesaid recent decision dated 10.09.2020 is reproduced as under:- “8.1 The above reasons clearly show that information was supplied by the Investigation Wing to the AO that assessee is beneficiary of accommodation entries received entries received from Shri Pramod Kumar Jindal in whose case search was carried ... relied upon the materials supplied by the Investigation Wing to him and statements recorded by the Investigation Wing during ITA NO. 4797/DEL/2019 – AY – 2011-12 the course of search. The A.O. formed his opinion that assessee received accommodation entries of Rs.15 lakhs from M/s. Timon Infrastructure Pvt. Ltd. However, later

Nisa Industrial Services Pvt. Ltd., Mumbai vs. ACIT- WD -10(3)(1), Mumbai

ITA 3171/MUM/2018[2014-15]Status: DisposedITAT Mumbai24 Nov 2020AY 2014-15

Bench: Shri C. N. Prasad, Jm & Shri S. Rifaur Rahman, Am

For Appellant: Respondent byFor Respondent: Ms. Kavita P. Kaushik, DR

Section 131Section 133Section 133ASection 143Section 143(2)

disallowable under section 68 of the Act. f) M/s Daffodil Traders Private Limited: A commission under section 131 (d) was sent to the investigation wing Kolkata on 17.11.2016 to verify the party and the address was as per the audit report submitted by the assessee. The investigation wing found that ... assessee and assessee submitted that the party has moved to new address and gave the new address. Based on the report from investigation wing Kolkata that the party has declared returned income of ₹ 8172/– and the turnover is ₹ 19 lakhs. The company has only reserves and surplus on the liability

Chetan S. Londhe, Thane vs. DCIT, Circle-1, Thane

In the result, appeal is allowed

ITA 1575/MUM/2019[2007-08]Status: DisposedITAT Mumbai24 Nov 2020AY 2007-08

Bench: Shri Saktijit Dey

For Appellant: Shri Kishore PoddarFor Respondent: Shri Sanjay J. Sethi

Section 132(4)Section 147

money by the assessee. Though, in the assessment order the Assessing Officer has stated that relevant portion of the statement recorded by the Investigation Wing was furnished to the assessee, however, from the submissions made by the assessee before learned Commissioner (Appeals), it is evident, the assessee has very clearly

Ramila Diam Private Limited, Mumbai vs. Pr.CIT-5, Mumbai

Accordingly, the impugned order is quashed and the appeal of assessee is allowed

ITA 2340/MUM/2018[2011-12]Status: DisposedITAT Mumbai24 Nov 2020AY 2011-12

Bench: Shri Vikas Awasthy & Shri Rajesh Kumarआयकर अपील सं./ Ita No. 2340/Mum/2018 (यिर्ाारण िर्ा / Assessment Year 2011-12) आयकर अपील सं./ Ita No. 2341/Mum/2018 (यिर्ाारण िर्ा / Assessment Year 2012-13) आयकर अपील सं./ Ita No. 2342/Mum/2018 (यिर्ाारण िर्ा / Assessment Year 2013-14) Ramila Diam Pvt. Ltd. The Pr. Commissioner Of B-401, 4 Th Floor, Anand Building, Income Tax-5, Tirupati Apartments, Bhulabhai बिाम/ Aayakar Bhavan, Maharshi Desai Road, Mumbai-400 026 Karve Road, Vs. Mumbai-400 020 (अपीलाथी / Appellant) (प्रत्यथी/ Respondent) स्थायी लेखा सं./Pan No. Aaecr8201P अपीलाथी की ओर से/ Appellant By : Shri M Subramanian, Ar प्रत्यथी की ओर से/ Respondent By : Shri K. Madhusudan, Dr सुििाई की तारीख / Date Of Hearing: 21.10.2020 घोर्णा की तारीख / Date Of Pronouncement: 24.11.2020

For Appellant: Shri M Subramanian, ARFor Respondent: Shri K. Madhusudan, DR

Section 143(3)Section 147Section 263

assessee. 2.1 The AR submitted that the assessment for Assessment Year 2011-12 was reopened on the basis of information received from investigation Wing regarding assessee’s alleged involvement in obtaining accommodation entries from Bhanwarlal Jain group. It was alleged that the assessee had obtained accommodation entries to the tune ... assessment in the case of assessee for Assessment Year 2011-12 was reopened on the basis of information received by Investigation Wing ITA Nos.2340 to 2342/ Mum/2018 Ramila Diam Pvt. Ltd. ; AY 2011-12 to 2013-14 after search on Bhanwarlal Jain group. As per the information, the assessee

Eminent Computers Pvt Ltd, New Delhi vs. ITO Ward - 8(2), New Delhi

ITA 6372/DEL/2019[2010-11]Status: DisposedITAT Delhi24 Nov 2020AY 2010-11

Bench: Shri Anil Chaturvedi & Shri Kuldip Singh(Through Video Conference)

For Appellant: Shri Shaantanu Jain, AdvocateFor Respondent: Shri Jagdish Singh, Senior DR

Section 143Section 147Section 68

section 143 (1) of the 3 ITA No.6372/Del./2019 Income-tax Act, 1961 (for short ‘the Act’). Subsequently, on receipt of information from the Investigation Wing for providing accommodation entries to different beneficiaries by the companies floated by Pradeep Kumar Jindal Group on the basis of search and seizure operation ... Rs.45,00,000/- in AY 2010-11 from three corporate entities managed and controlled by Pradeep Kumar Jindal, as shown in the report of Investigation Wing, which are as under :- S.No. From To Amount Date 1. M/s. Hajima M/s. Eminent Rs.15,00,000 23.06.2009 Resorts Ltd. Computers

ITO - 4(2)(4), Mumbai vs. M/S Maya Jewels Private Limited, Mumbai

In the result, appeal by the Revenue is dismissed

ITA 2994/MUM/2019[2009-10]Status: DisposedITAT Mumbai23 Nov 2020AY 2009-10

Bench: Shri Vikas Awasthyआअसं. 2994/मुं/2019 ("न.व.2009-10) Ito-4(2)(4), Room No.647, 6Th Floor, Aaykar Bhavan, M.K.Road, : अपीलाथ"/ Appellant Mumbai 400 020 बनाम/ Vs.

For Appellant: NoneFor Respondent: Ms. Smita Verma

Section 133(6)Section 143(3)

manufacturer of gold, silver, diamond and imitation jewellery. On the basis of information received from the Sales Tax Department, Government of Maharashtra by the Investigation Wing of Income Tax Department reassessment proceedings were initiated in the case of the assessee for the impugned assessment year. During the course of reassessment

Khetan Twist Net P.Ltd, Mumbai vs. ITO 12(3)(2), Mumbai

In the result, the appeal is partly allowed

ITA 3031/MUM/2017[2007-08]Status: DisposedITAT Mumbai23 Nov 2020AY 2007-08

Bench: Shri Saktijit Dey () & Shri N.K. Pradhan () Assessment Year: 2007-08

For Appellant: Smt. Arati Vissanji, ARFor Respondent: Shri Sunil Deshpande, DR

Section 132Section 132(4)Section 143(1)Section 143(3)Section 148

Tribunal concluded, from the reasons recorded, that the AO issued notice only on the basis of information received from the Investigation Wing but without coming to an independent conclusion for reason to believe that income had escaped assessment and allowed the appeal of the assessee. On appeal by the Revenue ... Kolkata and who were involved in giving accommodation entries of various nature to several beneficiaries including the assessee. The information supplied by the Investigation Wing to the Assessing Officer formed a prima facie basis to enable the Assessing Officer to form a belief of income chargeable to tax having escaped

Manju Sharma, New Delhi vs. ITO Ward - 45(5), New Delhi

In the result, the appeal filed by the assessee is partly allowed

ITA 8275/DEL/2019[2014-15]Status: DisposedITAT Delhi23 Nov 2020AY 2014-15

Bench: Shri R.K. Panda & Ms Suchitra Kambleassessment Year: 2014-15 Manju Sharma, Vs Ito, Wz-43B, Meenakshi Garden, Ward-45(5), New Delhi. New Delhi. Pan: Aatps2170A (Appellant) (Respondent) Assessee By : Shri Krishnan Sampath, Advocate Revenue By : Ms Rinku Singh, Sr. Dr Date Of Hearing : 03.11.2020 Date Of Pronouncement : 23.11.2020 Order Per R.K. Panda, Am: This Appeal Filed By The Assessee Is Directed Against The Order Dated 05.09.2019 Passed By The Ld. Cit(A)-15, New Delhi, Relating To Assessment Year 2014-15. 2. Facts Of The Case, In Brief, Are That The Assessee Is An Individual & Is Proprietor Of M/S Eastern Galaxy Which Is Engaged In The Business Of Export Of Handicrafts & Decorative Items. She Filed Her Return Of Income On 29.11.2014 Declaring Taxable Income Of Rs.47,10,000/-. The Case Of The Assessee Was Selected For Limited Scrutiny Under Cass With The Reason That There Is “Large Increase In Sundry Creditors With Respect To Turnover As Compared To Preceding Year.”

For Appellant: Shri Krishnan Sampath, AdvocateFor Respondent: Ms Rinku Singh, Sr. DR

Section 131Section 142(1)Section 144ASection 68

observing as under:- “10. Submissions made have been considered. 11. In the assessment proceedings Assessing Officer had relied upon information obtained from the Investigation Wing of the Department at Mumbai which in turn had obtained the information from the Sales Tax Department, Government of Maharashtra. The information ... Nikunj Eximp Enterprises Pvt. Ltd. that the revenue is required to furnish the information received from the Sales Tax Department or from the Investigation Wing of the Department to the assessee allowing the assessee to test the veracity of such information otherwise such information could not be relied upon. This

DCIT, Central Circle - 1(1), Kolkata vs. M/S. Alembic Merchants Pvt. Ltd., Kolkata

In the result, the appeal of revenue fails

ITA 1826/KOL/2018[2009-10]Status: DisposedITAT Kolkata20 Nov 2020AY 2009-10

Bench: Hon’Ble Shri J.Sudhakar Reddy, Am & Hon’Ble Shri A. T. Varkey, Jm Assessment Year: 2009-10 Dcit, Central Cir-1(1), Kolkata Vs. M/S. Alembic Merchants Pvt. Ltd Pan: Aacca 0918Q Appellant Respondent

Section 142(1)Section 147Section 148Section 153(2)Section 68

reasons recorded for reopening which is placed at page 31 of the paper book, which reads as under: "The office has been informed that Investigation Wing has conducted enquiry on the basis of some credible information in respect of cash deposits in a manner of dubious A/cs. The A/cs stood ... that the AO has proceeded to issue notice u/s 148 of the Act solely on the basis of some (not specific) information received from Investigation Wing without even specifying as to which correspondence of Investigation Wing he 11 A.Y 2009-10 M/s. Alembic Merchants P.Ltd received prompted him to base

Arshia Global Tradecom Pvt Ltd, Kolkata vs. ACIT, Circle-7(1), Kolkata

In the result, the appeal of the assessees (ITA No

ITA 2042/KOL/2019[2011-12]Status: DisposedITAT Kolkata18 Nov 2020AY 2011-12

Bench: Shri J.Sudhakar Reddy, Am & Smt. Madhumita Roy, Jm ]

Section 142(1)Section 143(2)Section 143(3)Section 144Section 147Section 148Section 68

Industrial Engineers (P) Ltd., reported in 73 taxmann. Com 185 in support of re-opening of assessment on the basis of information obtained from investigation wing to the AO. 8. The Ld. Counsel appearing on behalf of the assessee in reply to such arguments as advanced by the Ld.DR submitted ... bank of the assessee through various entities i.e. companies, proprietorship or partnership firm. On the basis of database available with the directorate of Investigation Wing, Kolkata the companies in which the fund of the assessee were transferred and sometimes received are merely paper/shell companies, which are controlled/managed

Anil Kumar Agarwal (HUF), Bangalore vs. Income Tax Officer, Ward- 3(2)(1), Bangalore

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 1586/BANG/2019[2015-16]Status: DisposedITAT Bangalore18 Nov 2020AY 2015-16

Bench: Shri George George K

For Appellant: --- None ---For Respondent: Sri.Ganesh R.Ghale

Section 10(38)Section 68

price of Rs.41.98 per share. The Assessing Officer carried out investigation by examining BSE data, financials of 3 ITA Nos.1584-1586/Bang/2019 Snehalatha Agarwal & Ors. KAFL, Investigation Wing report and the findings of the SEBI. The A.O. held that KAFL was one of the companies which were investigated by the Directorate ... operators. The A.O. discussed in detail the modus operandi of providing accommodation entry by the entry operators as well as the findings of the Investigation Wing in relation to KAFL scrip price rigging. The Assessing Officer concluded that the assessee had entered into engineered transaction to generate artificial long term

Santhosh Devi Agarwal, Bangalore vs. Income Tax Officer, Ward- 3(2)(1), Bangalore

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 1585/BANG/2019[2015-16]Status: DisposedITAT Bangalore18 Nov 2020AY 2015-16

Bench: Shri George George K

For Appellant: --- None ---For Respondent: Sri.Ganesh R.Ghale

Section 10(38)Section 68

Snehlatha Agarwal, Bangalore vs. Income Tax Officer, Ward- 3(2)(1), Bangalore

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 1584/BANG/2019[2015-16]Status: DisposedITAT Bangalore18 Nov 2020AY 2015-16

Bench: Shri George George K

For Appellant: --- None ---For Respondent: Sri.Ganesh R.Ghale

Section 10(38)Section 68

M/S Gunjeet Singh & Sons, Ludhiana vs. ITO-Ward-VI(1), Ludhiana

In the result the appeal of the assessee stands allowed

ITA 112/CHANDI/2020[1999-2000]Status: DisposedITAT Chandigarh17 Nov 2020AY 1999-2000

Bench: Or During The Course Of Hearing.

For Appellant: Shri Tej Mohan Singh, AdvocateFor Respondent: Smt.Meenakshi Vohra, Addl. CIT

account on account of amount received from sale of diamond jewellery was rejected by the AO on the basis of the report of the Investigation Wing in the case of M/s Tambi Exports, Jaipur, the alleged purchaser of the jewellery, wherein, it has been reported that M/s Tambi Exports ... further considering the submissions/evidences furnished by the assessee and observations of the AO based on the investigation report held that the report of the Investigation Wing on the basis of which the impugned additions were made into the income of the assessee by ITA-112/CHD/2020 A.Y. 1999-2000 Page

M/S. Om Prakash Badaya (HUF), Jaipur vs. Pr.CIT, Alwar

In the result, the appeal filed by the assessee is allowed

ITA 217/JPR/2020[2015-16]Status: DisposedITAT Jaipur13 Nov 2020AY 2015-16

For Appellant: Shri Manish Agrawal (AR)For Respondent: Shri A.S. Nehra (ACIT-DR)

Section 10(38)Section 143(3)Section 263

unexplained income of the assessee in view of the fact that there were survey and enquiries were conducted in this respect by the Investigation wing of the department at Kolkatta and further the company M/s Jackson Investment Ltd. was a penny stock company. After considering the entire material available ... lack of enquiry by the assessing officer as he failed to make proper investigation in respect of the material gathered by the investigation wing. He further contended that after amendment in the law when the explanation (2) section 263 has been inserted and the Ld. Pr. CIT is empowered

Ravish Lakhmani, Kolkata vs. Pr.CIT - 10, Kolkata

In the result, all the appeals filed by the assessees are allowed

ITA 47/KOL/2019[2014-15]Status: DisposedITAT Kolkata13 Nov 2020AY 2014-15

Bench: Sri J. Sudhakar Reddy & Ms. Madhumita Roy)

Section 10(38)Section 133(6)Section 143(3)Section 263Section 68

written submissions filed. It was confessed 'by several entry operators, share brokers, exit operators, etc. in the course of search/survey proceedings conducted by the Investigation Wing of the Department that they had received commission from the beneficiaries in lieu of such accommodation entries. Based on their statements, it would

Rachit Lakhmani, Kolkata vs. Pr.CIT - 10, Kolkata

In the result, all the appeals filed by the assessees are allowed

ITA 46/KOL/2019[2014-15]Status: DisposedITAT Kolkata13 Nov 2020AY 2014-15

Bench: Sri J. Sudhakar Reddy & Ms. Madhumita Roy)

Section 10(38)Section 133(6)Section 143(3)Section 263Section 68