Reassessment merely on the ground of cash deposit and non-filing of return not possible when return was actually been filed

Sunrise Education Trust Vs ITO (Exemption) (Gujarat High Court)

Petitioner has challenged a Notice dated 31^st March 2017 issued by the respondent-Assessing Officer to reopen the petitioner’s assessment for Assessment Year 2010-2011.

Brief facts are as under :

The petitioner is a registered Public Charitable Trust. For the Assessment Year 2010-2011, the petitioner had filed return of income on 13^th August 2010 declaring nil income. Such return was accepted by the Assessing Officer under Section 143 [1] of the Income-tax Act, 1961 [“the Act” for short] without scrutiny. To reopen such assessment, the Assessing Officer issued the impugned notice. In order to do so, he had recorded the following reasons :

“As per information available with this office, assessee trust had deposited Cash of Rs. 33,97,775/- in Gandhidham during the year under consideration. It is seen from the office records that no return of income filed by the assessee trust for A.Y. 2010-11. As it is evidence from the office records that assessee trust failed to disclose true and correct financial statement of its income for A.Y. 2010-11 and also not offered any income for tax purpose. Thus I have reasons to believe that cash deposited in bank by the trust, ought to have been brought to tax has escaped the assessment within the meaning of section 147 of the I.T. Act. Therefore, I propose to assess/reassess the income of the assessee trust for A.Y.2010-11 as per the provisions of section 147 of the Income tax Act, subject to the provisions of Section 148 to 153 of the Income Tax Act, 1961.”

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