Audit Memo do not fall within the ambit of the term “information” as provided in Explanation 1 to Section 148 of the Act w.r.t Finance Act 2021
Case Specifically related to Finance Act 2021.
Can AO reopen the case on the basis of Information received from Internal Audit memo?
Whether the internal audit memo can be considered to be“information” for the purpose of Explanation 1 to Section 148 of the Act?
Which Finance Act will be applicable to the notices issued under section 148 in consequence to Ashish Agarwal Case?
In case of ACIT, Circle – 5(3)(1) vs Rishabh Diamond Private Limited (ITA 1295/M/ 2024 & CO 75/M/2024) the hon’ble ITAT uphold the order of CIT Appeal where it has held that Audit Memo do not fall within the ambit of the term “information” as provided in Explanation 1 to Section 148 of the Act w.r.t Finance Act 2021.
The CIT APPEAL relied on the decision of the Hon’ble Bombay High Court case of Hasmukh Estates Pvt. Ltd. vs. ACIT, reported in (2023) 459 ITR 524 (Bom) held that the internal audit memo upon which the re-assessment is based does not qualify as valid information under the specified criteria as provided in Explanation 1 to Section 148 of the Act w.r.t finance act 2021.
The copy of the order is as under:
