KEC International Ltd. Vs Union of India (Bombay High Court)
Jurisdictional Assessing office other than AO Lehandas Arjun Janbandhu to pass fresh orders, after furnishing report received from DGGI to the petitioner.
The petitioner is a trader. It purchases goods from one M/s EMI transmission and exported the same. Some of the goods were supplied to power grids. Notice under section 148(a)(b) of the Income Tax was issued proposing addition on the ground that a report has been received from DGGI that one M/s Curzen is engaged in preparing fake/bogus bills and has dealt with M/s EMI Transmission, who has in turn dealt with the assessee. The petitioner replied. However, order under section 148(a)(d) came to be passed and a notice was issued under section 148 of the Income Tax Act. Petition was filed challenging the same.
The Hon’ble Bombay High Court allows the petition and set aside notice issued under section 148 and order passed under section 148(a)(d). It holds: (i) there is total non-application of mind on part of be assessing officer while passing order under section 148(a)(d) and equally while granting sanction under section 151; (ii) there has been no independent verification of the information received by the AO from DGGI and examination of the documents submitted by the assessee vis-à-vis the said information; (iii) petitioner has supplied documents showing sale of goods and there cannot be sale without purchase of goods; (iv) lambasts AO and directs re-adjudication by Jurisdictional Assessing office other than AO Lehandas Arjun Janbandhu to pass fresh orders, after furnishing report received from DGGI to the petitioner.
