Primit Shambhuprasad Purani Vs ITO (Gujarat High Court)
Gujarat High Court held that reopening of assessment under section 148 of the Income Tax Act is liable to be quashed in as much as source of funds for purchasing crypto currency duly explained. Accordingly, order quashed.
Facts- The respondent AO issued notice u/s. 148A(b) of the Income Tax Act on 17.03.2022 on the ground that the petitioner has purchased crypto currency amounting to Rs. 19,00,000/- during the year under consideration and has failed to explain the source of investment before DDIT (Investigation). Notably, respondent AO without considering the reply of the petitioner passed the impugned order dated 30.03.2022 under section 148A(d) of the Act. By this petition under Article 226 of the Constitution of India, the petitioner has challenged notice dated 30.03.2022 issued under section 148 of the Income Tax Act, 1961.
Conclusion- Held that the impugned order dated 30.03.2022 passed under section 148A(d) of the Act is a classic example of order passed without application of mind by the respondent Assessing Officer ignoring the fact on record.
Held that it is not in dispute that the petitioner has filed bank statement of his father from whom he had borrowed funds to purchase crypto currency which is available on record and not disputed by the learned advocate for the respondent. Thus, we are therefore, of the opinion that impugned order dated 30.03.2022 passed under section 148A(d) of the Act is liable to be quashed and set aside and is hereby quashed and set aside. Consequently notice issued under section 148 of the Act of the even date would not survive and is accordingly quashed and set aside. Special Civil Application No.7305/2022 stands disposed off.
