ITO Vs Nikhil Vinod Aggarwal (ITAT Mumbai)
Income Tax Appellate Tribunal (ITAT), Mumbai Bench, in the case of ITO vs. Nikhil Vinod Aggarwal, for the assessment year 2007-08, has dismissed the Revenue’s appeal and allowed the assessee’s cross-objection. The tribunal’s decision, pronounced on October 13, 2017, hinged on two key aspects: the procedural invalidity of the assessment reopening and the lack of conclusive evidence to support an “on-money” payment allegation.
Background of the Case
Nikhil Vinod Aggarwal, the assessee, filed his income tax return for the assessment year 2007-08, declaring a total income of ₹7,75,521. This return was initially processed and accepted under Section 143(1) of the Income-tax Act, 1961.
However, the assessment was subsequently reopened on March 30, 2014, by the Assessing Officer (AO) under Section 147 of the Act. This action was based on information received from the DIT (Investigation) – II, Mumbai, alleging that the assessee had paid “on-money” amounting to ₹79,26,400 to M/s. Crescendo Associates, a Hiranandani Group concern, for the purchase of flats. The AO’s re-assessment order included this alleged “on-money” as an addition to the assessee’s income, citing an admission from Hiranandani Group directors during a search operation in March 2014 that they had accepted “on-money” from various flat buyers.
