DCIT Vs Avani Ferro Alloys Pvt. Ltd. (ITAT Raipur)
ITAT Raipur Quashes Reassessment Notice as Time-Barred for A.Y. 2015-16; ITAT Raipur Holds Invalid Section 151 Approval Vitiates Reassessment
Summary: The Raipur Bench of the ITAT dealt with four Revenue appeals concerning Avani Ferro Alloys Pvt. Ltd. for assessment years 2015-16 to 2018-19. The appeals arose from reassessment proceedings in which additions were made principally on account of alleged bogus sales and, in one year, a further disallowance under section 40(a)(ia) of the Income Tax Act, 1961. For A.Y. 2015-16, the Assessing Officer had made an addition of Rs.6,92,46,463/- under section 68 r.w.s. 115BBE in respect of alleged bogus sales. Although the CIT(A)/NFAC deleted the addition on merits, it had rejected the assessee’s challenge to reassessment.
The assessee invoked Rule 27 before the Tribunal and contended that the reassessment notice was time-barred. The Tribunal admitted the legal ground, relying on the principles stated in Peter Vaz and Dahod Sahakari Kharid Vechan Sangh Ltd. It then held, following the decisions cited before it, including Union of India v. Rajeev Bansal and Deepak Steel and Power Pvt. Ltd. v. CBDT, that the notice under section 148 for A.Y. 2015-16 was barred by limitation. The reassessment proceedings were therefore quashed and the Revenue’s appeal was dismissed as infructuous. For A.Y. 2016-17, the CIT(A)/NFAC had already quashed the reassessment on limitation.
