Ravi Dilip Waghela Vs ITO (ITAT Mumbai)
Summary: Issuing a section 148 notice within time is one requirement. Serving it on the assessee is another. In this case, the Department sent a reopening notice to one address and later claimed service by pasting it on the door of a locked room at another. The Mumbai ITAT found no evidence connecting that room to the assessee. It quashed the reassessment and the consequential additions aggregating to ₹1,46,47,500.
The case also involved an unusual dispute about identity. The assessee said that the PAN and pharmaceutical business on which the Department’s information was based had been created through misuse of documents he had given to a former employer. The Tribunal did not decide whether that allegation was true. It decided the appeal on the prior question: was the jurisdictional notice ever validly served?
The information that led to reopening
The Department received information concerning M/s Brown Pharmaceuticals and Chemicals, identified in an enquiry as a concern providing accommodation entries. Bank transactions of ₹1,27,62,500 and ₹18,85,000 appeared in the name of M/s Kingsy Pharma, which the information described as Ravi Waghela’s proprietary concern under PAN ABRPW5450E. A notice under section 148 was issued on 27 March 2019, and the Assessing Officer ultimately made additions of ₹1,27,62,500 under section 69C and ₹18,85,000 under section 68.
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