Case Law Details
DCIT Vs Saarthak Vanijya India Ltd (ITAT Delhi)
The case of DCIT Vs Saarthak Vanijya India Ltd recently adjudicated by the Income Tax Appellate Tribunal (ITAT), Delhi raised a critical legal question: Can a case be reopened based solely on a retracted statement in the absence of other tangible materials?
The case involved a reassessment based on the statement of a Director of the assessee company. The statement was later retracted, and it was contended that the reassessment was unjustifiably initiated based solely on this retracted statement, in violation of Section 153A of the Income Tax Act. After reviewing the evidence presented, including bank account details and balance sheets of the investor companies, ITAT Delhi arrived at its decision. The Tribunal agreed with the contention that the statement of the Director alone, particularly given its subsequent retraction, was insufficient grounds for the reassessment.
The ruling of the ITAT Delhi in the DCIT Vs Saarthak Vanijya India Ltd case has profound implications for future cases involving reassessment under the Income Tax Act. It highlights the importance of concrete, corroborative evidence, beyond merely relying on individual statements, particularly when they have been retracted.
FULL TEXT OF THE ORDER OF ITAT DELHI
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