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TMI Blog2010 (10) TMI 850X X X X Extracts X X X X X X X X Extracts X X X X ..... e had set out to verify. If he feels that the case requires further scrutiny on other issues, he will be free to issue a notice initiating comprehensive scrutiny of the return, as is being done presently. Based on the assessment made by the AO, the officer has also initiated penalty as bad in law. Since the addition made by the AO itself is deleted by the Tribunal reccordig a fact that there was no claim made by the assessee with regard to income from house property or the deduction related thereto. In the absence of any such claim, the Tribunal opined, there was no question of assuming the jurisdiction on the basis that such a claim was inadmissible. In favour of assessee. - IT Appeal Nos. 1120 and 1159 of 2005 - - - Dated:- 19-10-2010 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Baid Credit and Portfolio (P) Ltd. 4697/3, Ansari Road, 21A, Darya Ganj, N. Delhi. Dt. 28th Oct., 2002 Sir/Madam, I have perused the return of income made by you on 30th Oct., 2001 for the asst. yr. 2001-02. On going through the said return and its enclosures, I have reason to believe that the below mentioned claims of loss exemption, deduction, allowance or relief are inadmissible:- 1. Filing fee Rs. 6,400. 2. Income from house property not shown. In connection with the above, you are hereby required to attend my office on 14th Nov., 2002 at 11:45 a.m. either in person or by a representative duly authorized by you in this behalf to produce or cause to be produced at the said time the following evidence/part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ieve that 'income from house property not shown'. The reason given by the Tribunal in nullifying the aforesaid notice was that it is not covered by the provisions of s. 143(2)(i) of the Act and notice for that purpose could not have been issued. For appreciating the controversy we reproduce the provision of s. 143(2)(i) of the Act. "143. Assessment:- (2) Where a return has been furnished under s. 139, or in response to a notice under sub-s. (1) of s. 142, the AC) shall,- (i) Where he has reason to believe that any claim of loss, exemption, deduction, allowance or relief made in the return is inadmissible, serve on the assessee a notice specified therein to produce, or cause to be produced, any evidence or particulars specified t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred by the assessee be not rejected. 7. In the present case the Tribunal recorded that there was no claim made by the assessee with regard to income from house property or the deduction related thereto. In the absence of any such claim, the Tribunal opined, there was no question of assuming the jurisdiction on the basis that such a claim was inadmissible. The relevant portion of the decision of the Tribunal in this regard reads as under:- "A conjoint reading of the above two provisions shows that an AO acting under s. 143(2)(i) has a limited scope and cannot travel beyond the return furnished by the assessee. Firstly, the AO should have a reason to believe that the assessee has claimed any inadmissible loss, exemption, deduction, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction by the AO was proper and valid. This submission is predicated on the later portion of the said notice whereby the assessee was directed to produce the evidence of particulars in support of his claim, inter alia, relating to evidence of house property. She submitted that the assessee had claimed depreciation in respect of property in question and in order to find out as to whether the claim was proper and not. Property in question held by the assessee was house for business purpose or not. In this line of argument she has also referred to s. 22 of the Act which relates to income from house property. She argued that normally the annual value of the property is to be treated as income which is to be taxed under head 'Income from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7th Aug., 2002 [(2002) 178 CTR (St) 9] wherein the provisions of s. 143, after insertion of cl. (i) therein are explained in the following manner:- "59. Providing for assessment of income on limited issues under s. 143:- 59.1 Under the existing procedure of assessment laid down in s. 143 of the IT Act, the AO if he considers it necessary or expedient, issue a notice under sub-s. (2) of s. 143 of the IT Act, requiring the assessee to produce any evidence which he may rely on in support of the return. Sub-s. (3) provides that after hearing such evidence and after taking into account all relevant material which he has gathered, the AO shall pass an order of assessment determining the total income or loss, and the sum payable or refunda ..... X X X X Extracts X X X X X X X X Extracts X X X X
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