Adiparashakti Boards Vs ITO (ITAT Hyderabad)
ITAT Hyderabad held that reopening of assessment u/s. 148 of the Income Tax Act is void-ab-initio since income escaped assessment doesn’t exceed Rs. 50 lakhs or more. Accordingly, assessment order passed by AO is quashed.
Facts- The assessment has been reopened U/s. 147 of the Act for the reasons recorded, as per which, income chargeable to tax had been escaped assessment and accordingly, notice U/s. 148A(b) of the Act, dated 24/03/2022 was issued with the reason that as per the NMS Model of Insight Portal for FY 2014-15, the assessee has entered into various financial transactions including the transactions for purchase of scrap and relevant TCS U/s. 206C of the Act and sale of immovable property valued at Rs. 30 lakhs or more.
AO passed order U/s. 148A(d) of the Act and rejected the explanation of the assessee and observed that it is a fit case for issue of notice U/s. 148 of the Act on the ground that income escaped assessment. CIT(A) dismissed the appeal. Being aggrieved, the present appeal is filed.
Conclusion- Held that the AO assumed jurisdiction by passing order U/s. 148A(d) of the Act on the basis of incorrect information and issued notice beyond three years from the end of the relevant assessment year even though the income escaped assessment does not exceed Rs. 50 lakhs or more. Thus, we are of the considered view that the notice issued by the AO U/s. 148 of the Act, dated 28/04/2022 is illegal, void-ab-initio and consequently the assessment order passed by the AO U/s. 143(3) r.w.s 147 of the Act, dated 18/03/2024 is liable to be quashed. Thus, we quash the assessment order passed by the AO.
