The Income Tax Appellate Tribunal, Delhi Bench ‘SMC’, heard the appeal of Sagplan Academy Pvt Ltd, based in Gurgaon, against the Income Tax Officer, Ward-4(1), Gurgaon, concerning the reassessment for the 2015-16 assessment year. The appeal challenged the order dated 14.09.2022 passed by the National Face Centre (NFC), Delhi.
The key issues revolved around the reassessment proceedings initiated under Section 147 of the Income Tax Act, 1961, after the completion of the original assessment under Section 143(3). Sagplan Academy contended that there was no proper basis for the reopening of the assessment, citing a lack of new tangible material and alleging that the reassessment was merely based on a change of opinion, which is not permitted under the Act.
The tribunal was tasked with determining whether the ITO had appropriately applied the legal provisions for reassessment, especially considering the time lapse and the original assessment details. Key arguments included the appropriateness of the notice under Section 148, the validity of the reasons to believe, and procedural adherence regarding the disclosure of material facts by the assessee.
The decision hinged on interpreting the legal framework around the proviso to Section 147, which restricts reassessment after four years unless there is non-disclosure of material facts by the taxpayer. The tribunal’s analysis and the subsequent ruling emphasized the importance of maintaining stringent standards for reassessment to prevent arbitrary reviews of concluded assessments.
Reassessment Challenge: Sagplan Academy Pvt Ltd vs. ITO, Ward-4(1), Gurgaon
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