The Income Tax Appellate Tribunal (ITAT), Delhi bench comprising Shri C.M. Garg, Judicial Member and Shri Pradip Kumar Kedia, Accountant Member has held that the re-assessment under section 148 of the Income Tax Act, 1961 invoked on the basis of incorrect and irrelevant facts is not sustainable under law.
The assessee, Mr. Kesav Saran approached the Tribunal against the order of the Assessing Officer on the ground that satisfaction has been recorded by considering wrong facts and without application of mind.
Relying on the Supreme Court decision in the case of National Thermal Power Co. Ltd. vs. CIT, the Tribunal held that “in our considered opinion, the initiation of re-assessment proceeding u/s. 147 and notice u/s. 148 of the Act has to be held as bad in law and not sustainable, as the Assessing Officer has taken into consideration incorrect and irrelevant facts at the time of taking action u/s. 147 and 148 of the Act and thus, we safely presume that the Assessing Officer has not applied his mind to the assessment file of the assessee before initiating reassessment proceedings.”
Quashing the order, the Tribunal concluded that “The facts and circumstances of the present case are quite similar to the facts and circumstances of the case of Hafizuddin Hazi vs. ITO. Therefore, respectfully following the same, we hold that in the present case, the assessee has actually filed the return of income and the Assessing Officer in the satisfaction note noted that the assessee has not filed return of income. Thus, we safely presume that the Assessing Officer has initiated reassessment proceedings by mentioning wrong and incorrect facts of the case and on the sole premise that the assessee has not filed return of income for the A.Y. 2009-10. Therefore, we safely presume that the Assessing Officer has initiated the reassessment proceedings and passed reassessment order on the basis of incorrect facts and without application of mind.”
Advocate Sh. Navin Gargh appeared for the assessee.
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