Spirit Global Constructions Pvt. Ltd. Vs ACIT (ITAT Delhi)
Reopening on Wrong PAN Invalid & Mechanical Sanction & Casual Reasons Fatal to Reassessment- Rs. 3.50 Cr Bogus Loan Addition Set Aside on Technical Grounds
In this case Assessee filed its return for AY 2012-13 declaring a loss of Rs. 2.91 crores which was accepted u/s 143(3) vide order dated 28.03.2014. Later, AO issued notice u/s 148 on 31.03.2019 alleging unexplained credits of Rs. 3.50 crores said to have been received from M/s Anamika Steel Traders Pvt. Ltd. & M/s Gajraj Steel Merchants Pvt. Ltd. The reassessment order dated 24.12.2019 added the said sum u/s 68. CIT(A) confirmed the addition & upheld reopening.
Before the Tribunal, Assessee argued that the notice u/s 148 was issued on an incorrect PAN “AAJCS2757B” instead of its correct PAN “AAICS2757B” & therefore no valid notice was served within the statutory period of six years. Screenshots from the income tax portal dated 04.04.2019 were produced showing no valid notice existed, which meant the return could not even be filed. It was only after AO corrected the PAN later that the notice began to appear on the portal, which according to the Assessee was impermissible. Assessee also pointed out that the reasons recorded initially mentioned receipt of Rs. 3.50 crores from one party i.e. Anamika Steel, whereas during reassessment AO changed his stand to allege Rs. 1.75 crores each from Anamika Steel & Gajraj Steel. This, it was submitted, reflected lack of enquiry & non-application of mind at the stage of recording reasons. Further, PCIT’s approval contained a mechanical remark “perused reasons satisfied fit case for 148 proceedings” without any independent application of mind.
