Bhawani Castings P. Ltd Vs DCIT (ITAT Delhi)
ITAT Delhi held that appeal of the assessee is allowed since reasons for reopening doesn’t coincide with the addition made in reassessment proceedings. It is a well settled law that if no addition is made on the basis of reasons recorded for reopening, no other addition can be made.
Facts- The assessee filed its return of income for AY 2018-19 on 28.09.2018 declaring total loss of Rs. 12,52,594/-. The notice u/s. 148A(b) of the Income Tax Act, 1961 was issued to the assessee, along with the notice reasons recorded for reopening assessment were also supplied to the assessee. The AO proceeded with the reassessment proceedings and vide assessment order dated 30.03.2023 passed u/s. 147 r.w.s 144B of the Act made addition of Rs.1,35,40,359/-on account of alleged bogus purchases made from M/s. G.S Industries.
Assessee mainly contested that the addition made by the AO in assessment proceedings is in respect of alleged bogus purchases from M/s. G.S Industries, whereas in the reasons recorded for reopening the AO has alleged that the assessee has obtained accommodation entries of bogus purchase from the concerns of Shri Deepak Sharma namely M/s. Mahinderpal & Sons and M/s. Jai Bhole Traders in the name of Gurdeep Singh and Parminder Singh, respectively. The additions made by the AO do not coincide with the reasons recorded for reopening, hence, the addition is not sustainable.
