Maithan Ceramic Limited Vs ACIT (ITAT Kolkata)
In Maithan Ceramic Limited vs. ACIT (ITA No.1944/KOL/2025, AY 2011-12), the Kolkata ITAT “C” Bench dismissed the Assessee’s appeal and upheld both the reopening u/s 147 and the addition of ₹1 crore u/s 68. The Tribunal held that the reassessment initiated on the basis of Investigation Wing inputs alleging accommodation entries was valid and not hit by the first proviso to Section 147, despite the original assessment having been completed u/s 143(3).
The Assessee had received a loan of ₹1 crore from M/s Nidhi Agro Pvt. Ltd. on 02.07.2010, which was duly reflected in books, tax audit report, confirmations were filed, interest paid with TDS, and the loan was later repaid. However, the reopening notice dated 23.03.2018 alleged that the Assessee was a beneficiary of accommodation entries routed through shell entities, including Vista Dealcom Pvt. Ltd., based on FIU-IND / Investigation Wing material.
Rejecting the Assessee’s plea of “change of opinion”, “fishing & roving enquiry”, limitation u/s 149, and absence of failure to disclose material facts, the Tribunal held that the reasons recorded sufficiently indicated escapement of income of ₹1 crore and that the proviso to Section 147 did not bar reopening. The Bench also noted that repayment of loan, by itself, does not conclusively establish genuineness. On merits, the Tribunal concluded that the Assessee failed to prove the genuineness of the loan transaction, and therefore sustained the addition u/s 68. Consequently, the appeal was dismissed in toto
FULL TEXT OF THE ORDER OF ITAT KOLKATA
