Panaqua Tradecom Pvt. Ltd. Vs ITO (ITAT Agra)
The ITAT Agra allowed the assessee’s appeal against the CIT(A)’s order remanding a reassessment made under Sections 147/144 of the Income-tax Act. The assessee contended that the CIT(A) erred in setting aside the assessment without deciding legal grounds challenging the validity of the reassessment, including jurisdiction under Sections 147, 148, 148A and 151 and the assessment against a non-existing entity.
The Tribunal observed that the proviso to Section 251(1)(a), inserted with effect from 01.10.2024, uses the word “may”, indicating that the CIT(A) is not required to remand every assessment made under Section 144 and should decide jurisdictional issues where raised.
The Tribunal noted that the show cause notice under Section 148A(b) did not specify the nature of the transaction or whether ₹54,99,90,000 represented a receipt or payment. In response, the assessee explained that the amount represented sale proceeds received from M/s Astrogems & Jewellery Pvt. Ltd., formed part of total sales of ₹3,11,78,34,353, and had already been offered as income, supported by bank statements, sales registers, balance confirmation and financial statements.
The Tribunal found that this explanation had been completely ignored by the Assessing Officer while passing the order under Section 148A(b) and issuing notice under Section 148. Holding that the amount was already included in the assessee’s income, the Tribunal concluded that there was no income escaping assessment. It therefore held that the assumption of jurisdiction under Section 147 was flawed, quashed the entire reassessment, left the remaining grounds open as academic, and allowed the appeal.
