ITO Vs Rakhi Vipul Jogi (ITAT Mumbai)
Investigation Wing Can Give the Tip-Off, But AO Must Do His Own Homework – Reassessment u/s 147 Quashed for Borrowed Satisfaction Despite Specific Purchase & Sale Figures
Facts — NMCE Information Triggers Reopening
The assessee had filed her return declaring income of ₹7,36,940, which was processed u/s 143(1). Subsequently, the AO received information from the Investigation Wing, Kolkata regarding alleged misuse of the National Multi Commodity Exchange (NMCE) for providing accommodation entries through contrived transactions.
The information referred to transactions allegedly undertaken by the assessee involving purchases of ₹2,77,12,725 & sales of ₹2,78,29,475. Based on this information, the AO reopened the assessment & issued notice u/s 148 on 29.03.2019.
Assessment — F&O Profit Treated as Accommodation Entry
During reassessment, the AO noticed that the assessee had undertaken F&O/commodity transactions through M/s Star Commodities & earned profit of ₹8,07,420.
Treating the transactions as accommodation entries, the AO added ₹8,07,420 u/s 68. He further added ₹24,225 u/s 69C, representing 3% estimated commission allegedly paid for obtaining the accommodation entry.
Additionally, the AO noticed purchase of an immovable property for ₹50 lakh. Finding the explanation regarding its source unsatisfactory, he treated the amount as unexplained investment u/s 69. The reassessment was ultimately completed at total income of ₹66,68,584.
