Seema Puri Vs ITO (ITAT Delhi)
The Delhi Bench (SMC) of the ITAT allowed the appeal of Seema Puri for AY 2011-12 and quashed the reassessment proceedings initiated under sections 147/148 as being bad in law.
The Tribunal found that the very foundation of the reopening was factually incorrect. One of the core reasons recorded by the Assessing Officer was that the assessee had not filed her return of income, whereas, in reality, the assessee had duly filed her return under section 139(1) on 31.07.2011, a fact also acknowledged by the AO in the assessment order. Reopening an assessment on such a demonstrably wrong premise was held to show non-application of mind, rendering the notice invalid.
Placing reliance on binding precedents including ITO v. Sumitra Devi and the Gujarat High Court decision in Sunrise Education Trust, the ITAT held that where reasons for reopening proceed on erroneous factual assumptions, the entire reassessment collapses. The Tribunal also noted infirmities in the approval under section 151, which further vitiated the reopening.
Since the reassessment was quashed on this jurisdictional defect, the Tribunal did not examine the additions on merits (₹21 lakh treated as unexplained cash credit and ₹52,500 as alleged commission), leaving those issues open.
Accordingly, the reassessment order passed under section 143(3) read with section 147 was declared void ab initio, and the appeal was partly allowed on legal grounds.
FULL TEXT OF THE ORDER OF ITAT DELHI
