Point of Law: Assessing Officer having arrived at his subjective satisfaction based on additional fresh material placed before him that the petitioner had not fully and truly disclosed all the material facts necessary for his assessment for the relevant assessment year and prima facie his income chargeable to tax had escaped assessment, he was fully justified in initiating the proceedings under section 147/148 of the said Act.

JUDGMENT :

BELA M. TRIVEDI, J.

1. The present petition filed by the petitioner-Zaveri and Company Private Limited through its Director-Kishor Pranjivandas Mandalia, under Article 226/227 of the Constitution of India, is directed against the impugned notice dated 30.03.2019 (Annexure-F) issued under section 148 of the Income Tax Act, 1961, (hereinafter referred to as ‘the said Act’) and the order dated 10.10.2019 (Annexure K) passed by the respondent rejecting the objections filed by the petitioner against the said notice.

2. The facts in nutshell as emerging from the record of the petition are that the petitioner-company is engaged in the business of manufacturing and trading in jewellery, bullion trading, trading and speculation in commodities, shares and securities, units of mutual funds and derivatives, generation and sales of electric power through windmills and trading in SEZ unit as well as gold and silver refinery business. The petitioner had filed the return for the A.Y. 2012-13 and thereafter had filed a revised return. After the scrutiny assessment having been undertaken on various points and after issuing the show-cause notice, the Assessing Officer had framed the assessment order under section 143(3) of the said Act on 28.03.2014. Thereafter the petitioner received a notice under section 148 on 28.03.2017 seeking re-opening of the assessment for the A.Y. 2012-13 on the ground of the alleged accommodation entries obtained by the petitioner-company, as revealed during the search proceedings in case of one Bhanwarlal Jain Group. The said proceedings terminated in the assessment order dated 29.12.2017 passed under section 143(3) read with Section 147 of the said Act (Annexure E). According to the petitioner, the petitioner again received the impugned notice dated 30.03.2019 issued by the respondent for reopening of the assessment in the case of the petitioner for the assessment year 2012-13 under section 148 of the said Act (Annexure F). The petitioner filed return of income in response to the said notice as per Annexure G. The petitioner received the reasons dated 18.04.2019 recorded for reopening of the assessment under section 147 of the Act for the year 2012-13 (Annexure H). On the receipt of the said reasons for reopening, the petitioner filed exhaustive objections on 13.06.2019 along with the supporting documents (Annexure I). The respondent vide the order dated 10.10.2019, rejected the said objections (Annexure K). Being aggrieved by the said order, the present petition has been filed.

3. The gist of the reasons recorded for reopening of the assessment under section 147 of the Act for the assessment year 2012-13, as emerging from Annexure-H is that the office of the respondent had received the information from the office of DDIT (Inv.) Unit-1(3), Ahmedabad on 24.03.2019 inter-alia that the petitioner-company was identified as one of the beneficiaries of the accommodation entries unearthed during the course of search proceedings conducted on 11.09.2018 in case of Sanjay Shah and Jignesh Shah of Ahmedabad, which had resulted into seizure of unaccounted cash of Rs. 19.37 crores along with the incriminating digital as well as documentary evidences. The clandestine record of unaccounted cash, synchronized trading, proving bogus LTCG in various BSE listed scrips and transport of such cash through angadiyas was found to be maintained in secret Tally Data file. In the said secret file, against the transactions of shares on BSE platform, movement and delivery of cash, the receipt of commission in cash under the head into “LTG Commission” was recorded, which manifested the record of the accommodation entries of LTCG against the receipt of cash. The data analysis coupled with the circumstantial evidences led to the discovery that 15 BSE listed scrips were used for generating bogus LTCG and contrived losses, as admitted by the accommodation entry providers. Further, the respondent office also received an information in the case