INCOME TAX ACT, 1961

Section 147

Reassessment - Validity of reopening - Assessee entered into the commodity/share transactions -

As per the information received, assessee had made transaction in commodity/shares. As per the ITD/AST/ITBA information, assessee had not filed his return of income. It was noted that no ITR was filed by assessee with regard to assessment year 2011-12. Since assessee had not furnished return of income for assessment year 2011-12, income from shares/commodities transaction had escaped assessment. However, in absence of any denial, the profit of the total transactions was assumed that the rate of 2%. Accordingly, AO concluded that income had escaped assessment because of failure on part of assessee to disclose fully and truly all material facts of his income. Held: There was a tangible material available with AO in the form of annual information return. The concrete details were available about the broker through Womb the assessee had made the transaction. AO further noted that Assessee had not filed any voluntary return of income under section 139(1). Therefore, it was found that AO was having a tangible material in the nature of Annual Information Return where concrete information about the trading by assessee on commodities/shares were available with a particular broker for which assessee had not disclosed any profit/loss. Information available with AO cannot be found to be vague as there was concrete information with every rupee was found to be correct about the turnover and the name of broker. Therefore, there was a proper application of mind by AO and no infirmity in the action of AO in reopening the assessment under section 147.

REFERRED :

FAVOUR : Against the assessee.

A.Y. : 2011-12

INCOME TAX ACT, 1961

Section 145

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