No Revision Where AO Examined Issues in Detail Under Black Money Act: ITAT

The assessees, Chintan Navnitlal Parikh and Shefali Chintan Parikh, were beneficiaries of the “Nutshel Trust,” a discretionary offshore trust set up in Jersey in 1990. In 2015, they made a voluntary disclosure under Section 59 of the Black Money Act, declaring their beneficial interest in the trust at about Rs. 25.66 crore and paying the applicable tax and penalty. The Assessing Officer passed an order under Section 10(3) accepting the disclosures.

Thereafter, the Principal Director of Income Tax (Investigation) invoked revisionary powers under Section 23, alleging inadequate examination of alleged “capital distributions” reflected in old trust minutes and certain foreign bank accounts.

Main Issue: Whether revision under Section 23 of the Black Money Act is permissible when the AO has already conducted detailed inquiries and taken a conscious, plausible view on the same material.

Tribunal Ruled: The ITAT quashed the revision order and restored the original assessment. The Tribunal held that the alleged capital distributions and foreign bank accounts had already been thoroughly examined during the investigation and were part of the record considered by the Assessing Officer.

It was noted that the capital distributions were merely historical entries in trust minutes dating back to 1990-2006 and did not represent any actual receipt by the assessees, the amounts having already formed part of the disclosed trust corpus.

The Tribunal held that once the Assessing Officer had taken a legally sustainable view after due inquiry, revisionary powers could not be exercised merely to re-examine the same material or to conduct a roving and fishing enquiry.

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