Chandra Mohan Vs Office of the ACIT (ITAT Delhi)
Summary: The Delhi Bench of the Income Tax Appellate Tribunal disposed of eight connected appeals filed by Chandra Mohan for Assessment Years 2014-15 to 2021-22. The appeals arose from reassessment proceedings initiated after a search under section 132 in the case of M/s Ravindra Oil & Ginning Mills on 02.06.2022. During the search, digital data described as “Sanjeev Tally” was found, which according to the Revenue contained details of out-of-books sales and purchases. The Assessing Officer treated alleged purchases by the assessee from M/s Ravindra Oil & Ginning Mills as undisclosed purchases and made additions under section 69C read with section 115BBE. The CIT(A) upheld the additions.
The assessee challenged, among other matters, the jurisdiction assumed under section 148, limitation under Section 149 the treatment of third-party “Sanjeev Tally” data as relevant books or entries, non-issuance of notice under section 143(2), and denial of an opportunity to cross-examine persons whose statements or material were relied upon.
On the challenge to the satisfaction recorded under Explanation 2(iv) to section 148, the Tribunal rejected the assessee’s objection. It held that, under the amended reassessment framework, the Assessing Officer was required at that stage to examine whether the information contained in seized material related to the assessee and to obtain the requisite prior approval. The Tribunal found that the Assessing Officer had examined the Investigation Wing information and compared it with the assessee’s return. The Tribunal therefore held that the satisfaction was valid and was not merely borrowed satisfaction. The Tribunal also distinguished the cases relied upon by the assessee because those decisions concerned section 153C satisfaction.
