Montreaux Resorts Pvt Ltd Vs ITO (ITAT Delhi)
ITAT Delhi held that reasons recorded for exercising the jurisdiction is plagued with several defects of critical nature. Thus, due to lack of jurisdiction u/s. 147 of the Income Tax Act reassessment proceedings held as bad-in-law.
Facts- Assessee has preferred the present appeal against order of the National Faceless Appeal Centre. The assessee has inter alia challenged the assumption of jurisdiction under Section 147 of the Act and alleged that the prerequisite of Section 147 and Section 151 of the Act has not been clearly fulfilled in the present case and consequently, the additions made by the AO is not justified on merits too.
Conclusion- No minimal reasons were given regarding his satisfaction for such approval. The approval given is clearly mechanical, perfunctory and routine. Thus, neither the reasons recorded under Section 148 of the Act justify the allegation towards escapement of income nor the approval given by the Addl. CIT stands the test of judicial scrutiny.
Held that reasons recorded for exercising the jurisdiction is plagued with several defects of critical nature. Such defects are incurable under Section 292B of the Act. On the face of such lack of jurisdiction under Section 147 of the Act, the reassessment proceedings itself is bad in law.
