No Sufficient Reason to Prove Income Escaped Assessment: ITAT dismisses Revenue’s Appeal for Reopening Assessment [Read Order]

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The Kolkata Bench of Income Tax Appellate Tribunal ( ITAT )has held that no sufficient reason to prove income escaped assessment and dismissed revenue appeal for reopening the assessment.

The Revenue is aggrieved by the action of the CIT(A) in holding that there was no sufficient reason available for the Assessing Officer to believe that the income of the assessee, Sri Deepak Bajaj, for the assessment year under consideration has escaped assessment. Hence the revenue preferred appeal before ITAT.

The assessee submitted that the assessment year involved is 2008-09, whereas, the reasons have been recorded for reopening of the assessment on 31.03.2015, i.e., the reasons for reopening of the assessment were on the last date of the limitation period to reopen the assessment. The assessee further submitted that he was not given any opportunity to file objections against the reopening of the assessment. Since the assessee has been denied the opportunity to contest the reopening, therefore, the reopening of the assessment was bad in law.

The Tribunal observed that the only information available to the Assessing Officer was that there was a turnover of more than Rs.3 crores out of which there was the withdrawal of cash was Rs.94.97 lakhs in the bank account of the assessee. Except for the aforesaid information, there was no information available to the Assessing Officer that the income of the assessee in any manner has escaped assessment. Without correlating the same with the accounts and with the nature of the business of the assessee, in the opinion of the Tribunal, that was not enough to form a belief of escapement of income of the assessee for the assessment year under consideration.

The Coram of Sri Sanjay Garg and Sri Girish Agrawalby relies upon the decision of the Bombay High Court in the case of CIT Vs. Jet Airways Limited has held that “wherein it has been held that if the Assessing Officer fails to make any addition on the basis of reasons recorded, the Assessing Officer gets no jurisdiction to add any other item of income. In view of the above discussion, we do not find any infirmity in the order of the CIT(A) and the same is upheld”.

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Shri Deepak Bajaj vs ITO, Ward-40(1)

Counsel for Appellant:   Shri Dilip Chantterjee

Counsel for Respondent:   Smt. Ranu Biswas


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