INCOME TAX ACT, 1961

Section 147

Reassessment - Reopening based on information emanated from investigation Wing - Non-application of mind by AO -

AO received information from investigation wing as to assessee having made bogus purchases. Accordingly, AO reopened assessment and made addition. Assessee challenged this on the ground of non-application of mind by AO and re-opening was based on wrong facts. Held: Reasons recorded were not provided to the assessee when they were originally sought for, in the manner in which they were recorded, so as to enable the assessee to furnish his objections, if any. Non-disposal of objections raised by speaking order specifically when figures of purchases were recorded in the reasons were factually incorrect when purchases were only to the tune of Rs. 5,98,336 in the reasons given to assessee the amount was reflected as Rs. 31,20,073 and Rs. 78,315 and in the reasons given in the assessment order the figure was given as Rs. 19,28,589. The facts were all mixed up and errors have crept into the reasons recorded. Thus, re-opening was bad in law for the reason that there was total non-application of mind by AO to the information received from Investigation Wing. No preliminary verification had been made. Factual inaccuracies, though pointed out, were not corrected. Re-opening based on such wrong facts recorded in the reasons for re-opening rendered the re-opening bad in law.

Applied:Pr. CIT v. SNG Developers Ltd. (2018) 404 ITR 31 (Del-HC) : 2018 TaxPub(DT) 3140 (Del-HC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2013-14

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