High Court of Delhi was dealing with the petition challenging the order passed by the Income Tax Appellate Tribunal dated 25, August, 2020 rejecting the appellant’s appeal for the Assessment Year 2011-12.
Brief Facts:
The respondent/assessee filed the original return of income on 27, July, 2011. A search was conducted at the premises of the respondent on 22, March, 2012 and the assessment was framed under Section 153A of the Income Tax Act, 1961. A notice of reassessment under Section 148 of the Act was issued and served upon the respondent. The reason for re-opening the assessment was that the Investigation Directorate of Kolkata had informed the Assessing Officer that the respondent had traded in penny stocks and used the said transactions to allegedly book bogus claims of Long-Term Capital Gain.
HC’s Observations And Held:
Court observed that the Long-Term Capital Gain had not only been disclosed in the return of income by the respondent, but the same was also claimed to be exempt. No adverse inference was made to the returned income of the respondent even when the Assessing Officer was fully aware of the Long-Term Capital Gain claimed as exempt from tax.
Court stated that “in the garb of reassessment proceedings, the appellant cannot seek to verify the same details on the strength of material which was already available on record. This Court is also in agreement with the finding of the Tribunal that the assumption of jurisdiction by issuing notice under Section 148 of the Act is bad in law. Accordingly, the present appeal and application are dismissed.”
Bench: Hon'ble Mr. Justice Manmohan And Hon'ble Mr. Justice Navin Chawla
Case Title: Principal Commissioner Of Income Tax v. Ishwar Chand Mittal
Case Details: ITA 7/2022 & CM APPL.1972/2022
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