The Tax Publishers2020 TaxPub(DT) 3616 (Kol-Trib)

INCOME TAX ACT, 1961

Section 147

During reassessment when AO finds that item on basis of which he reopened does not survive, then reasons recorded to reopen loses its significance and the fall out is that AO's jurisdiction to reassess is without jurisdiction and therefore is illegal and fragile in the eyes of law.

Reassessment - Validity - Additions made on issues other than those on basis of which reassessment was initiated -

On basis of information received by AO regarding bank accounts allegedly maintained by assessee in Switzerland, AO initiated reassessment proceedings. However, while framing reassessment AO made addition on different issues on account of Long Term Capital Gain, Short Term Capital Gain, disallowance under section 14A, etc. Held: During reassessment when AO finds that item on basis of which he reopened does not survive, then reasons recorded to reopen loses its significance and the fall out is that AO's jurisdiction to reassess is without jurisdiction and therefore is illegal and fragile in the eyes of law. Since after having no jurisdiction to reassess his further action of a new fact finding in absence of any item specified in reasons recorded which was the foundation on which he reopened, when no longer subsisted, AO's action was hit being 'quarum non-judice' and, therefore, addition was non-est in the eyes of law.

Followed:CIT v. Infinity Infotech Parks Ltd [ITAT No. 60 of 2014 And G.A. No. 1736 of 2014, dt. 10-9-2014]

REFERRED : Ganga Saran & Sons Private Ltd. v. ITO & Ors. (1981) 130 ITR 1 (SC) : 1981 TaxPub(DT) 0952 (SC) CIT v. Mehak Finvest Pvt. Ltd. 2014 TaxPub(DT) 4080 (P&H-HC) Ranbaxy Laboratories Ltd. v. CIT (2011) 336 ITR 136 (Del.) : 2011 TaxPub(DT) 1457 (Del-HC) Majinder Singh Kang v. CIT 2012 TaxPub(DT) 2028 (P&H-HC) CIT v. Jet Airways (I) Ltd. (2011) 331 ITR 236 (Bom.) : 2011 TaxPub(DT) 0218 (Bom-HC) CIT v. Ram Singh (2008) 306 ITR 346 (Raj) : 2008 TaxPub(DT) 2035 (Raj-HC) CIT v. Atlas Cycle Industries (1989) 180 ITR 319 (P&H) : 1989 TaxPub(DT) 1149 (P&H-HC) DCIT v. Aryan Mining & Trading Corporation Ltd. [ITA No. 122 & 123/Kol/2017 Order, dated 22-5-2019] Dipti Mehta v. ITO (ITA No. 2032/Kol/2018 dated 1-3-2019) : 2019 TaxPub(DT) 1846 (Kol-Trib) Jakhotia Plastics Pvt. Ltd. v. Pr. CIT (2018) 94 taxmann.com 96 (SC) : 2018 TaxPub(DT) 3352 (SC)

FAVOUR : In assessee's favour

A.Y. :

IN THE ITAT, KOLKATA BENCH

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