“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

Rajendra Kumar Hirawat (HUF), Chennai vs. ITO Non Corporate Circle 9(5), Chennai

In the result, both the appeals filed by the assessee are allowed for statistical purposes

ITA 2510/CHNY/2018[2014-15]Status: DisposedITAT Chennai02 Jan 2019AY 2014-15

Bench: Shri N.R.S. Ganesan & Shri S. Jayaramanआयकर अपील सं./Ita Nos.2509 & 2510/Chny/2018 "नधा"रण वष" /Assessment Years : 2009-10 & 2014-15

For Appellant: Shri D. Anand, AdvocateFor Respondent: Shri AR.V. Sreenivasan, JCIT

Section 10(38)

claim of the assessee under Section 10(38) of the Act on the basis of the information said to be received from the Investigation Wing of the Department at Kolkata. According to the Ld. counsel, the copies of the investigation report said to be received from Kolkata and other enquiries ... file of the Assessing Officer with a direction to furnish a copy of the investigation report said to be received from the Investigation Wing of the Department at Kolkata and to decide the issue afresh thereafter in accordance with law. The Ld.counsel has also placed his reliance on the order

Rajendra Kumar Hirawat (HUF), Chennai vs. ITO Non Corporate Circle 9(5), Chennai

In the result, both the appeals filed by the assessee are allowed for statistical purposes

ITA 2509/CHNY/2018[2009-10]Status: DisposedITAT Chennai02 Jan 2019AY 2009-10

Bench: Shri N.R.S. Ganesan & Shri S. Jayaramanआयकर अपील सं./Ita Nos.2509 & 2510/Chny/2018 "नधा"रण वष" /Assessment Years : 2009-10 & 2014-15

For Appellant: Shri D. Anand, AdvocateFor Respondent: Shri AR.V. Sreenivasan, JCIT

Section 10(38)

Ketan Dineshchandra Mehta, Chennai vs. Itoncr 11(3), Chennai

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

ITA 2318/CHNY/2018[2014-15]Status: DisposedITAT Chennai02 Jan 2019AY 2014-15

Bench: Shri N.R.S. Ganesan & Shri Abraham P. Georgeआयकर अपील सं./Ita No.2318/Chny/2018 "नधा"रण वष" /Assessment Year : 2014-15 M/S Ketan Dineshchandra Mehta, The Income Tax Officer, 143, Broadway, Parrys, V. Non Corporate Ward 11(3), Chennai - 600 108. Chennai - 600 006. Pan : Aafpm 5926 L (अपीलाथ"/Appellant) (""यथ"/Respondent)

For Appellant: Shri K. Balasubramanian, AdvocateFor Respondent: Shri V.M. Mahidar, JCIT

Section 10(38)Section 68

Shri K. Balasubramanian, the Ld.counsel for the assessee, submitted that the Assessing Officer, placing reliance on the report 2 I.T.A. No.2318/Chny/18 received from the Investigation Wing of the Department at Kolkata, denied exemption under Section 10(38) of the Income-tax Act, 1961 (in short 'the Act') and made addition ... Assessing Officer, however, disallowed the claim of the assessee based upon the investigation report said to be received from the Investigation Wing of the Department at Kolkata. The Ld.counsel further submitted that the Assessing Officer has not furnished copies of investigation report to the assessee, therefore, the matter

ACIT, New Delhi vs. M/S. Kad Housing Pvt. Ltd., Delhi

In the result, appeal filed by the revenue is dismissed

ITA 6288/DEL/2015[2007-08]Status: DisposedITAT Delhi02 Jan 2019AY 2007-08

Bench: Sh. N. K. Billaiya & Ms. Suchitra Kambleassessment Year: 2007-08 Acit Kad Housing Pvt. Ltd. Central Circle –06, Room Vs 151, Savita Vihar No.364, Delhi Ara Centre, Jhadewalan Pan Aacck4705B Extn., New Delhi (Appellant) (Respondent)

Section 143Section 147Section 148

circumstances of the case, the CIT(A) has erred in ignoring the fact that fresh evidence in the form of survey report of the investigation Wing was available for formation of belief that the assessee has introduced its own money in the form of share application money through proper companies

Radhika Garg, Faridabad vs. ITO, Ward-11(2), Faridabad

In the result, ITA.No.2429/Del

ITA 4738/DEL/2018[2015-16]Status: DisposedITAT Delhi01 Jan 2019AY 2015-16

Bench: Shri Bhavnesh Saini

For Appellant: Shri Vivek Bansal And Shri Sanjay Goel, AdvocatesFor Respondent: Shri S.L. Anuragi, Sr. D.R

Section 10(38)Section 68Section 69

account of sale of securities. The case was selected for scrutiny assessment on the basis of information uploaded by the Investigation Wing that “Suspicious Transaction relating to Long Term Capital Gain on sale of shares.” The A.O. discussed about the term ‘Penny Stock’ which transactions are of those shares which ... company, an acting Company on MCA website allowed till recently to trade on recognized stock exchange by the SEBI. No copy of report of Investigation Wing have been provided. Assessee has no control over activity of the company in question whether its price rig etc., The SEBI after detailed investigation

Esha Strips P.Ltd, Faridabad vs. ITO, Ward-8(3), New Delhi

ITA 4689/DEL/2018[2009-10]Status: DisposedITAT Delhi01 Jan 2019AY 2009-10

Bench: Shri Bhavnesh Saini

For Appellant: Shri Ashwani Kumar, CAFor Respondent: Shri S.L. Anuragi, Sr.D.R

Section 133(6)Section 139(1)Section 143(3)Section 147Section 148Section 68

Rs.5,47,858/- for assessment year under appeal was filed by the assessee on 4th September, 2009. Subsequently, certain information was received from Investigation Wing of the Income 2 Tax Department with regard to financial transactions entered by the assessee during the year under consideration. On examining the said information ... reason for objection was that in assessment year 2004-05 and 2005-06 notices u/s.148 were issued on the same information given by the Investigation Wing and after verification returned income was accepted vide order passed u/s.143(3)/147 of the IT Act. M/s. Tauraus Iron and Steel Company

Nishika Aggarwal, Gurgaon vs. ITO, Ward- 3(1), Gurgaon

In the result, ITA.No.2429/Del

ITA 2429/DEL/2018[2014-15]Status: DisposedITAT Delhi01 Jan 2019AY 2014-15

Bench: Shri Bhavnesh Saini

For Appellant: Shri Vivek Bansal And Shri Sanjay Goel, AdvocatesFor Respondent: Shri S.L. Anuragi, Sr. D.R

Section 10(38)Section 68Section 69

M/S Kota Dall Mill, Kota vs. Deputy Commissioner of Income Tax, Central Circle, Kota

ITA 998/JPR/2018[2011-12]Status: DisposedITAT Jaipur31 Dec 2018AY 2011-12

For Appellant: Shri Vijay Goyal & Shri Gulshan Agarwal (CAs)For Respondent: Shri Varinder Mehta (CIT)

Section 132Section 143(3)Section 153ASection 153B(1)(b)Section 68

respect of the unsecured loans and partners’ capital received by the assessee. The AO relied upon the information/details and statement recorded by the Investigation Wing, Kolkata in ITA Nos. 1057 to 1062 & 1210/JP/2018. M/s. Kota Dall Mill, Kota. case of third party. The assessee received unsecured loans and partners’ capital ... clearly evident from the innumerable evidences which came to the fore in the numerous investigations, enquiries, search and survey actions carried out by the Investigation Wing of the Department that the AO received information from the Investigation Wing Kolkata regarding the involvement of KBM Group (assessee) in obtaining entries

M/S Kota Dall Mill, Kota vs. Deputy Commissioner of Income Tax, Central Circle, Kota

ITA 997/JPR/2018[2010-11]Status: DisposedITAT Jaipur31 Dec 2018AY 2010-11

For Appellant: Shri Vijay Goyal & Shri Gulshan Agarwal (CAs)For Respondent: Shri Varinder Mehta (CIT)

Section 132Section 143(3)Section 153ASection 153B(1)(b)Section 68

Deputy Commissioner of Income Tax, Central Circle, Kota vs. M/S Kota Dall Mill, Kota

ITA 1057/JPR/2018[2010-11]Status: DisposedITAT Jaipur31 Dec 2018AY 2010-11

For Appellant: Shri Vijay Goyal & Shri Gulshan Agarwal (CAs)For Respondent: Shri Varinder Mehta (CIT)

Section 132Section 143(3)Section 153ASection 153B(1)(b)Section 68

Sri Subrata Banerjee, Kolkata vs. ACIT, Circle - 51(1), Kolkata

ITA 2275/KOL/2018[2014-15]Status: DisposedITAT Kolkata31 Dec 2018AY 2014-15

Bench: Shri S.S.Godara & Shri, M. Balaganesh

Section 143(3)Section 69C

Services Ltd. finds mention in the list of bogus long term / short term capital loss as per information and data provided by Income Tax Investigation Wing, Kolkata 6. Ld. AO. has also relied upon the financial results and graph showing increase and subsequent fall of price of share ... different persons generating bogus entries of Long Term including Sri Sunil Kumar Dokania recorded Capital Gains (LTCG) which is exempt from by the Investigation Wing of Kolkata who tax and the modus operandi adopted by the explained the modus operandi of providing operators to make the beneficiary by shares accommodation

ITO, Ward - 4(1), Kolkata vs. M/S. Tribute Trading and Finance Ltd., Kolkata

ITA 1496/KOL/2017[2014-15]Status: DisposedITAT Kolkata31 Dec 2018AY 2014-15

Bench: Shri S.S.Godara & Shri, M. Balaganesh

Section 143(3)Section 69C

ITO, Ward - 4(1), Kolkata vs. M/S. Tribute Trading and Finance Ltd., Kolkata

ITA 1495/KOL/2017[2013-14]Status: DisposedITAT Kolkata31 Dec 2018AY 2013-14

Bench: Shri S.S.Godara & Shri, M. Balaganesh

Section 143(3)Section 69C

Nawal Kishore Dhupar, New Delhi vs. ITO, Ward- 63(1), New Delhi

In the result, the appeal filed by the assessee is Partly Allowed for statistical purpose

ITA 3972/DEL/2018[2014-15]Status: DisposedITAT Delhi31 Dec 2018AY 2014-15

Bench: Sh. R.K. Pandaassessment Year: 2014-15

Section 10Section 10(38)Section 115Section 68

conducted by the Directorate of Investigation, Kolkata, Delhi, Mumbai & Ahmedabad and the modus operandi of providing accommodation entry in such cases were found. Further, Investigation Wing, Kolkata identified 84 listed penny stock companies, shares of which were used for generating bogus LTCG by various entry operators for the beneficiaries

Rr Distributors Pvt. Ltd., New Delhi vs. ITO, Ward- 20(3), New Delhi

In the result, the Assessee’s appeal is allowed for statistical

ITA 2718/DEL/2018[2009-10]Status: DisposedITAT Delhi31 Dec 2018AY 2009-10

Bench: Shri H.S. Sidhuassessment Year: 2009-10

For Appellant: Sh. Shafiq Khan, AdvocateFor Respondent: Sh. SL Anuragi, Sr. DR

Section 142(1)Section 147Section 234BSection 271(1)Section 68

principle of natural justice. Secondly, in para 4.3 of the appellate order, Ld. CIT(A) has wrongly held that Report of the Investigation Wing relied upon by the AO for the addition in dispute has not been supplied to the assessee and held that no negative inference could be drawn

M/S Kota Dall Mill, Kota vs. Deputy Commissioner of Income Tax, Central Circle, Kota

ITA 999/JPR/2018[2012-13]Status: DisposedITAT Jaipur28 Dec 2018AY 2012-13

For Appellant: Shri Vijay Goyal & Shri Gulshan Agarwal (CAs)For Respondent: Shri Varinder Mehta (CIT)

Section 132Section 143(3)Section 153ASection 153B(1)(b)Section 68

Prabhu Finsec Pvt. Ltd., New Delhi vs. ITO, Ward- 20(1), New Delhi

ITA 1221/DEL/2018[2008-09]Status: DisposedITAT Delhi28 Dec 2018AY 2008-09

Bench: Sh. K. N. Chary & Dr. Mitha Lal Meenaassessment Year: 2008-09 Ito Prabhu Finsec Pvt. Ltd.403, Vs W A R D - 2 0 ( 1 ) 405 M G House, Community Centre, W Azirpur Industrial New Delhi Area, New Delhi-110052 Pan Aaacp5228J (Appellant) (Respondent)

Section 147Section 148Section 151Section 68Section 69

vehemently contended that in the reasons recorded, the AO, made a short note without applying mind to the information received from the Investigation Wing, and recorded that he has reason to believe that an income of Rs. 10,00,000/- has escaped assessment which clearly shows that the AO proceeded ... having any valid satisfaction on the basis of borrowed satisfaction as there was no independent application of mind to the tangible material received from Investigation Wing, which could form the basis for reason to believe that income has escaped assessment. 10. Again, placing reliance on the decision

Latha C.Mohan, Chennai vs. Commissioner of Income Tax (Appeals)-2, Chennai

In the result, the assessee’s appeal is treated as allowed for

ITA 2113/CHNY/2017[2012-13]Status: DisposedITAT Chennai27 Dec 2018AY 2012-13

Bench: Shri N.R.S. Ganesan & Shri S. Jayaramanआयकर अपील सं/.I.T.A. No. 2113/Chny/2017 "नधा"रण वष"/Assessment Year : 2012-13 Smt. Mohan Latha Chandra, Assistant Commissioner Of Income Shop No. 4, Luz Ginza, Vs. Tax, 140A, Royapettah High Road, Non Corporate Circle 1, Mylapore, Chennai. Chennai – 600 004. [Pan: Aabpl 3991Q] (अपीलाथ"/Appellant) (#$यथ&/Respondent)

For Appellant: Shri. K. Senguttuvan &For Respondent: Shri. B. Sagadevan, JCIT

also very low for a service provider etc, a Survey was conducted in the business premises of the assessee on 10.5.2013 by the Investigation Wing of the Department to verify the correctness of the accounts maintained by the assessee. In the course of Survey, certain books and documents were impounded

Shri Udit Agarwal, Kolkata vs. DCIT(It)-2(1), Kolkata

Appeal is allowed accordingly

ITA 1839/KOL/2017[2014-15]Status: DisposedITAT Kolkata26 Dec 2018AY 2014-15

Bench: Shri S.S.Godara & Shri, M. Balaganeshassessment Year :2014-15 Shri Udit Agarwal V/S. Dcit (It)-2(1), 110, 3, Madan Mohan Burman Shanti Pally, Kolkata- Street, Kolkataa-007 107 [Pan No.Ahupa 0424 B] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Subash Agarwal, Advocate अपीलाथ" क" ओर से/By Appellant Shri Robin Choudhury, Addl. Cit-Dr ""यथ" क" ओर से/By Respondent 03-12-2018 सुनवाई क" तार"ख/Date Of Hearing 26-12-2018 घोषणा क" तार"ख/Date Of Pronouncement आदेश /O R D E R Per S.S.Godara:- This Assessee’S Appeal For Assessment Year 2014-15 Arises Against The Commissioner Of Income Tax (Appeals)-22,Kolkata’S Order Dated 10.05.2017 Passed In Case No.71/Cit(A)/22/Kol/14-15/16-17 Involving Proceedings U/S 143(3) Of The Income Tax Act, 1961; In Short ‘The Act’. Heard Both The Learned Representatives. Case File Perused. 2. The Assessee’S Sole Substantive Ground Challenges Correctness Of Both The Lower Authorities’ Action Treating Its Long Term Capital Gains (Ltcg) Of ₹64,99,391/- To Be Unexplained Cash Credits U/S 68 Of The Act. The Cit(A)’S Detailed Discussion To This Effect Reads As Under:- ”06. Decision: 1. I Have Carefully Considered The Action Of The Ld. Ao In Treating The Amount Of Rs.67,24,391/- Being Claimed By The Appellant To Be Proceeds Of Shares Sold To Be Ltcg & Claimed As Exempt. The Findings Of The Ld. Ao Are Based On The Information Being Supplied By The Investigation Wing Of The Department At Kolkata. I Have Also Carefully Examined The Submissions Of The Appellant, Wherein

Section 143(3)Section 68

shares sold to be LTCG and claimed as exempt. The findings of the Ld. AO are based on the information being supplied by the Investigation wing of the Department at Kolkata. I have also carefully examined the submissions of the appellant, wherein ITA No.1839/Kol/2017 A.Y 2014-15 Sh. Udit Agarwal ... Term Loss seekers or dummy paper entities. g. The statement of Narendra Probu Dayal (Promoter of Tuni Textile Mills Limited, as forwarded by the Investigation Wing) was recorded on 022.06.2015. The relevant extracts are as under follows. [quote] Statement on oath recoded of Shri Narendra Prabhudayal Sureka, aged 61 years

ITO, Ward - 40(2), Kolkata vs. Shri Suresh Chand Gupta, Kolkata

Appeal is dismissed

ITA 1730/KOL/2017[2014-15]Status: DisposedITAT Kolkata26 Dec 2018AY 2014-15

Bench: Shri S.S.Godara & Dr. A.L. Sainiassessment Year :2014-15 Ito Ward-40(2) V/S. Shri Suresh Chand Gupta 2Nd Floor, 3 16, Tara Chand Dutta Government Place Street, Kolkata-700073 West,Kolkata-700001 [Pan No.Aczpg 0724 C] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Ajoy Kr. Singh, Cit-Dr अपीलाथ" क" ओर से/By Appellant Shri Manish Tiwari, Fca ""यथ" क" ओर से/By Respondent 26-11-2018 सुनवाई क" तार"ख/Date Of Hearing 26-12-2018 घोषणा क" तार"ख/Date Of Pronouncement आदेश /O R D E R Per S.S.Godara:- This Revenue’S Appeal For Assessment Year 2014-15 Arises From The Commissioner Of Income Tax (Appeals)-12, Kolkata’S Order Dated 20.04.2017, Passed In Case No.10190/Cit(A)-12/Kol/Ward-40(2)/2016-17, In Proceedings U/S. 143(3) Of The Income Tax Act, 1961; In Short ‘The Act’. Heard Both The Parties. Case File Perused. 2. The Revenue’S Sole Substantive Ground Raised In The Instant Appeal Pleads That The Cit(A) Has Erred In Law & On Facts In Reversing The Assessing Officer’S Action Treating Assessee’S Alleged Long Term Capital Gains (Ltcg) Of ₹3,84,74,960/- To Be Bogus In The Nature Of Unexplained Cash Credits U/S 68 Of The Act. The Cit(A)’S Detailed Discussion Qua The Impugned Sole Issue Reads As Under:- “3.2 I Have Perused The Observations & Findings Contained In The Assessment Order. I Have Also Considered The Submission Of The Appellant Along With Paper Book Filed By Ld. A/R Which Contained, Inter-Alia, The Following Documents:-

Section 10(38)Section 142(1)Section 143(3)Section 68

instead of actual figure of Rs. 3,58,81,1321-. I find that AO besides relying upon the general report of the Investigation wing, Kolkata has not brought on record, any cogent, relevant evidences which can prove that in reality there was no purchase & sale of' shares by the appellant ... claim of the appellant and treated the long term gain as unexplained cash credit solely on the basis of general report of the Investigation wing, Kolkata. The AD's observations are purely based on suspicion and surmises. I find from the paper book that the appellant had applied