Reachasia vs. DCIT/ACIT, Circle-29, Kolkata

Parties Involved

Facts Summary

The assessee, Reachasia, filed a return of income on 30.09.2012 declaring a total income of Rs.20,52,420/-. The case was selected for scrutiny, and the assessment was framed under section 143(3) of the Income Tax Act, 1961, on 28.03.2014, assessing the total income at Rs.27,43,530/-. Subsequently, the Assessing Officer reopened the assessment under section 147 by issuing a notice under section 148 on 29.03.2019, based on information that the assessee was a beneficiary of accommodation entries in the form of bogus unsecured loans. The assessee responded to the notice and complied with the statutory notice under section 142(1). The Assessing Officer made an addition of Rs.40,00,000/- under section 68, alleging that the assessee failed to prove the genuineness of the transaction and the creditworthiness of the investor companies.…

Legal Issues

• 1. Whether the reassessment order under section 147 is valid after a period of four years from the end of the relevant assessment year.
• 2. Whether the addition of Rs.40,00,000/- under section 68 is justified.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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