Case Law Details
Naroli Resorts Private Limited Vs ACIT (Bombay High Court)
Introduction: The case between Naroli Resorts Private Limited and ACIT took a significant turn in the Bombay High Court. Central to the case was whether the Assessment Officer (AO) was justified in reopening an assessment after the expiry of four years without proof that the assessee failed to disclose material facts.
Detailed Analysis:
1. The Genesis of the Dispute: Naroli Resorts Private Limited challenged a notice dated 30th March 2021, issued under Section 148 of the Income Tax Act, 1961, pertaining to the Assessment Year 2014-2015.
2. The Root Cause: Upon inspection, the respondent found a discrepancy in the assessee’s share capital payment. The matter of contention arose from the premium charged on shares issued to M/s. Kesar Motels Pvt. Ltd., a related party. The AO believed the assessee charged an excess premium, resulting in a significant amount escaping assessment.
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