Case Law Details
Manu Stock Broking Private Limited Vs ACIT (ITAT Mumbai)
Introduction: The case of Manu Stock Broking Pvt Ltd Vs ACIT, adjudicated by the Mumbai Income Tax Appellate Tribunal (ITAT), delves into the impact of additional issues on proceedings under sections 147 and 148 of the Income Tax Act. Let’s delve into a detailed analysis of the ruling.
Detailed Analysis: The appeal was filed by the Assessee against the order passed by the Commissioner of Income-tax (Appeals)-47, Mumbai, pertaining to the Assessment Year 2013-14. The Assessee declared its total income at Rs. 6,01,110/- and was subsequently assessed under section 143(3) of the Act, resulting in a computed total income of Rs. 12,555,970/-.
The Assessing Officer (AO) received information regarding alleged bogus accommodation entries received by the Assessee. Despite no additions being made based on these reasons, the AO proceeded to make additional disallowances concerning trading losses and cash expenses on commission.
The Tribunal observed that additions unrelated to the reasons for reopening the assessment are unsustainable without a fresh notice under section 148 of the Act. Citing legal precedents, including the case of Commissioner of Income-tax-5, Mumbai vs. Jet Airways (I) Ltd and Ranbaxy Laboratories Ltd. vs CIT, the Tribunal ruled that such additions render the assessment void ab initio.
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