The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) quashed reassessment proceedings initiated on the basis of incorrect facts recorded by the assessing officer.
The Assessee, Anuj Chaudhary filed return of income for AY 2009-10 was originally filed u/s 139 of the Act by the assessee on 22.09.2010 declaring taxable income of Rs. 3,90,294/- offering business income from the business of trading of material supplies and agricultural income.
The assessment of the assessee was sought to be reopened by issuance of notice u/s 148 of the Act. Accordingly the Reassessment was completed by the AO u/s 144 read section 147 of the Act on 09.12.2016 after making addition towards cash deposits in saving bank account of Rs. 13,47,000/- and unexplained investment in purchase of land of Rs. 42 lakhs.
Aggrieved, the assessee filed an appeal before the CIT(A) who upheld the addition made by the AO towards unexplained investment in property of Rs. 42 lakhs and granted partial relief of Rs. 2,32,800/- on account of cash deposit made in the saving bank account. . Therefore the assessee filed another appeal before the tribunal.
The tribunal during the adjudication the tribunal observed that the AO made incorrect assumptions while recording the reasons and the AO had come to conclusion that cash deposit of Rs. 13,47,000/- made in the saving bank account would constitute income escaping assessment in the hands of the assessee, warranting reopening under Section 147 of the Income Tax Act.
After reviewing the submissions of both parties the two-member bench of Dr. B. R. R. Kumar ( Accountant Member ) and Saktijit Dey, ( Vice President ) quashed the reassessment by holding that assumption of jurisdiction under Section 147 of the Income Tax Act in the instant case is based on incorrect facts recorded thereon.
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