Tribunal sets aside reassessment and section 263 revision over alleged bogus sales

5-Second Takeaway

The Tribunal set aside the reassessment order making an addition of Rs. 15,44,00,004 as alleged bogus sales and restored the matter to the Assessing Officer for fresh adjudication. It also held that the Principal CIT’s section 263 revision could not survive once the underlying assessment had been set aside.

The assessment was framed under section 147 read with section 144B after the Assessing Officer treated sales aggregating Rs. 15,44,00,004 as bogus and added the entire amount under section 68. The assessee challenged the reassessment, including the validity of the reopening itself.

The Tribunal found it appropriate, in the interest of justice, to set aside the assessment and send the matter back to the Assessing Officer for fresh adjudication. The officer was directed to examine all issues raised by the assessee afresh, including the challenge to the reassessment proceedings under section 147.

The Tribunal also considered the Principal CIT’s order under section 263, which had directed the assessment to be reframed. Since the very assessment order had already been set aside and restored for reconsideration, the revisionary order was held to have no legs to stand on.

Accordingly, the section 263 order was also set aside, and the Assessing Officer was directed to pass a fresh speaking order after giving the assessee a reasonable opportunity of hearing.