Case Law Details
Hiteshkumar Babulal Ramani Vs ACIT (Gujrat High Court)
Conclusion: Reassessment by AO was justified as it could not be said that there was no material before AO to reopen the assessment and he proceeded mechanically based on the sole information received from the Investigation Wing and the impugned notice was without jurisdiction and contrary to Section 147.
Held: Assessee had filed his return of income for A.Y. 2014-15 declaring total income of Rs.8,56,000/ and same was processed under Section 143 (1) and thus, accepted without any scrutiny. Survey under Section 130 A was conducted in the case of Aphrodite Infra Pvt. Ltd, Surat and back up of computer, laptop and mobiles were taken in Hard Disk and the gadgets were impounded. After verification of the back up data, the authority found one undisclosed bank account of assessee bearing Account No.1002100006771 with the Prime Cooperative Bank Ltd. at Surat during the F.Y. 2013-14. During the course of survey, the statement of assessee was recorded under Section 133, wherein, he admitted that the alleged bank account was maintained by him and the same was opened and closed in the F.Y 2013-14. After receiving the information, the authority had verified the return of income and other documents related to the undisclosed bank account and the information was found correct as there was credit entries of Rs.85,11,543/, which was not reflected in the IT return as this amount was chargeable to tax and had escaped assessment within the meaning of Section 147. It was held that it was the duty of assessee to bring to the notice of the officer with regard to transactions made in the bank account which were relevant for the assessment for that year. Merely submission or production of books of accounts or other documents was not sufficient. It was profitable to refer the explanation 1 of Section 147, which explained that, the production before AO of the account books or other evidence from which material evidence could with due diligence had been discovered by AO would not necessarily amount to disclosure within the meaning of foregoing proviso. The details available in the books of account for balance sheet or profit or loss account could not absolve assessee from his disclosure obligation under Section 147 as in the instant case, without any scrutiny, the original return was process under Section 143(1). It could not be said that there was no material before the Assessing Officer to reopen the assessment and he proceeded mechanically based on the sole information received from the Investigation Wing and the impugned notice was without jurisdiction and contrary to Section 147. Therefore, there was enough material before AO and he was justified to reopen the assessment for the year under consideration.
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
1. By this writ application under Article 226 of the Constitution of India, the writ applicant has assailed the legality and validity of the impugned notice dated 26.03.2018 issued by the Assessing Officer under Section 148 of the Income Tax Act, 1961 (for short “the Act, 1961”), whereby, the assessment for the assessment year 201415 is sought to be reopened in exercise of the powers under Section 147 of the Act.
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