ITAT quashes Reassessment Proceedings Initiated by Assessing Officer  without having Tangible  Materials [Read Order]

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently quashed the  reassessment proceedings initiated by the Assessing officer without having tangible materials.

The assessee  Boston Scientific International is a foreign company dealing with trading and distribution of medical consumable and equipment and marketing support services.

The original assessment for Assessment year  2013-14 was completed under Section 143(3) of the Income Tax Act, 1961 on 29.03.2019 determining the total income of the assessee at Rs. 2,21,02,144/- under Section 115JB of the Income Tax Act. This completed assessment was sought to be reopened by the AO by issuance of notice under Section  148 of the Income Tax Acton 26.03.2021 after obtaining the approval under Section  151 of the Income Tax Act  from the competent authority.

Aggrieved by the order, the assessee filed an appeal before the Assistant Commissioner of Income Tax (Appeals)[ACIT(A)] who dismissed the appeal of the assessee. Therefore, the assessee filed a second appeal before the tribunal.

The tribunal while considering the submission of the parties observed that the  AO did not have any tangible material which would enable him to form a reasonable belief that income of the assessee had escaped assessment warranting reopening under Section 147 of the Income Tax Act.

The Assessing Officer (AO) had merely looked into the records available with him and the tax audit report in form 3CD which is also part of records available with him.

Further, it was also observed  there is absolutely no whisper of the failure committed by the assessee to disclose fully and truly all material facts relevant for the purpose of assessment.

The bench further relied upon the decision of  Bombay High Court in the case of Hindustan Lever Ltd. vs R.B. Wadkar had categorically held that reasons recorded by the ld AO should speak for itself and there cannot be any substitution by way of addition or deletion thereon.

Hence, a bench consisting of two members, M. Balaganesh, (Accountant Member)  Kul Bharat, (JudicialMember) held that AO had invalidly assumed the jurisdiction under Section  147 of the  Income Tax Act.

Deepak Kumar, counsel appeared for the assessee and Vijay B. Vasanta, counsel appeared for the revenue.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates