J. G’s Departmental Store Vs ITO Ward 60(1) & Ors. (Delhi High Court)
Delhi High Court held that reassessment order passed under section 148A(d) of the Income Tax Act beyond the scope of notice issued under section 148A(b) of the Income Tax Act is not sustainable and liable to be set aside.
Facts- The Assessee is a partnership firm engaged in the business of operating a chain of departmental stores. The Assessee is running seven departmental stores in Delhi and held the necessary licenses for the sale of wine and beer. Being involved in retail trade, more than 90% of its sales were made in cash, which the Assessee regularly deposited into its bank accounts.
The case for scrutiny was to examine the cash deposits made by the Assessee during the demonetization period. AO passed the assessment order dated 21.12.2019 u/s. 143(3) of the Act, accepting the Assessee’s contentions.
Thereafter, the AO issued show cause notices to the Assessee u/s. 148A(b) of the Act, asking the Assessee to explain why the assessment in respect of AY 2017-18 should not be reopened and the income be reassessed u/s. 147 of the Act. It was alleged that during the assessment year under consideration, the transactions, as mentioned, aggregating ₹17,80,23,257/-, remained unexplained and the same were not considered while passing the assessment order u/s. 143(3) of the Act. It was also alleged that these transactions were not disclosed in the income tax returns filed by the Assessee.
