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Mentioning of wrong section and wrong facts in the reasons recorded for reopening of the assessment u/s 148 made the reassessment liable to be quashed – ITAT Delhi

M/S ADMACH AUTO LIMITED, ITA NO. 9543/DEL/2019

Maheshwari Roller Flour Mills Pvt. Ltd. vs. ITO

ITA No. 4257/Del/2019

Pronounced on 17.12.2020

In the recent judgment by the Hon’ble ITAT Delhi, it was held that mentioning of the wrong section and wrong facts in the reasons recorded for reopening of assessment proceedings u/s 148 of the Income Tax Act, makes the assessment liable to be quashed as the same seems mechanical in nature without application of mind by the Ld. Assessing officer.

Facts of the Case: 

  1. The Assessee Company filed its return of income and same is processed u/s 143(1) of the Income Tax Act, 1961.
  2. Subsequently, on the basis of information received from DDIT(Inv.), the AO issued notice of reassessment u/s 148 of the Income Tax Act, 1961.
  3. On the persual of the reasons recorded for the issuance of notice u/s 148 , it is noticed that the Assessing Officer has mentioned that “reopening have been done under section 147(b) of the I.T. Act as is reproduced above.” Further, such Section under section 147(b) of the I.T. Act have already been omitted from the Income Tax Act w.e.f.01.04.1989.
  4. Furthermore, report of DIT (Inv.) Dated 12.03.2013 which is referred to in the reasons for reopening of the
    assessment is placed before the Hon’ble Tribunal which also was a borrowed satisfaction without applying independent mind by the A.O. to the relevant provision of Law and to the facts of the case.
  5. Thus, the A.O. has mentioned wrong Section, wrong facts in the reasons for reopening of the assessment and has acted in a mechanical manner without application of mind.
  6. An identical issue have been examined by ITAT, Delhi Bench in the case of VRC Township Pvt. Ltd., Delhi
    (supra) in which several decisions of High Court and Tribunal have been referred to on identical issue and reopening of the assessment have been quashed.

To Read Complete Judgement, Maheshwari Roller Flour Mills Pvt. Ltd., ITA.No.4257/Del./2019

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