Himadri Speciality Chemical Limited Vs A/DCIT (Calcutta High Court)
Calcutta High Court held that reassessment proceedings initiated under section 148 of the Income Tax Act based on the same survey material which was already accepted by AO in earlier proceedings is not sustainable in law. Accordingly, reassessment proceedings cannot be sustained.
Facts- The petitioner is engaged in the business of manufacturing of coal tar pitch, carbon black etc. Based on the information/material gathered during the survey operation, AO initiated reassessment proceedings in respect of the income of the transporter for A.Y. 2019-20 by issuing a notice dated June 28, 2022 u/s. 148 of the 1961 Act. Ultimately, AO completed the assessment of the transporter by an order dated August 26, 2022 passed u/s. 143(3)/147 of the 1961 Act thereby accepting the submissions of the transporter and the explanation furnished by petitioner without making any addition on the basis of the allegation of return of cash of Rs.80,62,000/-.
Subsequently, a notice dated March 31, 2022 u/s. 148 of the 1961 Act was issued to the petitioner with a view to reassess the petitioner’s income for the assessment year 2018-19. Such reopening of assessment was also based on the same information gathered by the revenue authorities during the survey proceedings conducted at the office premises of the transporter. On August 26, 2022 AO passed an order of assessment u/s. 147 of the 1961 Act without making any addition on the ground of cash return of Rs.4,75,00,000/- that formed the basis for reassessment of the petitioner’s income for the assessment year 2018-19.
