Shroff Properties Pvt. Ltd. Vs ITO (ITAT Kolkata)
ITAT Kolkata held that re-assessment proceedings initiated under section 148 of the Income Tax Act without any tangible material and without independent application of mind is not sustainable in law. Accordingly, reassessment is quashed.
Facts- Assessee has preferred the present appeal. The assessee has raised various grounds of appeal. The grievance of the assessee is twofold, firstly on the legal issue challenging the validity of reopening proceedings contending them to be bad in law and based on borrowed satisfaction without establishing any tangible nexus between the information received and belief formed, secondly, on the merits of the case that the sum of Rs.10.00 lakh received during the year was through banking channel and the same was utilised for purchasing Equity Shares and thus the transaction is genuine and addition made as unexplained cash credit u/s.68 of the Act is uncalled for.
Conclusion- Held that the re-assessment proceedings carried out in the instant case by the AO are without any tangible material and without independent application of mind even when all the details of the alleged transaction were duly explained by the assessee. Since I have held the legal issue in favour of the assessee and quashed the reassessment proceedings, no addition survives and therefore, the grounds raised by the assessee on merits became merely academic in nature.
