9911796707
TMI Blog2013 (4) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... tone Road, Allahabad (now known as Tashkand Marg, Allahabad) under the Government Grants Act, 1985. Lease of the plot expired in the year, 1962 and was renewed on 7th of May, 1990 for a further period of thirty years with further renewal's clause. It was renewed in the name of Smt. Rukmani Devi, Sri Yogesh Kumar Gupta, brother, and in the name of petitioner Mahesh Kumar Gupta. The leasehold rights were subsequently got converted into freehold rights on 27th of August, 1990. It appears that these persons decided to sell a parcel of the land and they applied for and were granted sanction by the Income Tax Department under section 230(A) (i) of the Income Tax Act. The parcel of the land was sold for a sum of Rs.8,25,000/- and each petitioner g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use (b) or sub- clause (c); (b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to rupees one lakh or more for that year; Explanation.-- In determining income chargeable to tax which has escaped assessment for the purposes of this sub-section, the provisions of Explanation 2 of section 147 shall apply as they apply for the purposes of that section.] (2) The provisions of sub- section (1) as to the issue of notice shall be subject to the provisions of section 151. (3) If the person on whom a notice under section 148 is to be served is a person treated as the agent of a non- resident unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ees One Lakh. In fact there was no suggestion from the side of the proposing officer that the amount was above Rupees One Lakh. The limitation for issuing notice will be enhanced from four years to six years, only if income escaping assessment was in excess of Rupees One Lakh. The notice has admittedly been issued beyond four years and within six years. Counter affidavit may be filed within two weeks, rejoinder affidavit may be filed within two weeks thereafter. List thereafter. The original file has been returned to the learned standing counsel of the Income Tax Department." A counter affidavit has been filed on behalf of the respondents. There it has been stated that an assessee has not disclosed the income under the head 'capital ga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sulting into short term capital gains in view of the judgment of Hon'ble Karnataka High Court in the case of CIT vs. Dr. V.V. Mody (218 ITR page 1). I have, therefore, reason to believe that the income chargeable to tax under the head Short Term Capital Gains has escaped assessment." The reason assigned for reopening is that the petitioner after converting the leasehold land into freehold sold the property within three years after converting the land into freehold resulting into short term capital gain in view of the Karnataka High Court's decision referred to above. What income is said to have been escaped does not find mention therein. Even assuming for the sake of argument, the income was liable to be taxed as short term gain unless th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment Year. The proviso to section 151 (1) fortifies our view which says that after the expiry of four years from the end of the relevant Assessment Year no notice under section 148 shall be issued or unless the Chief Commissioner or Commissioner is satisfied on the reasons recorded by the Assessing Officer that it is a fit case for issue of such notice. On a true and proper constructions of the proviso it is imperative that the Assessing Officer in his reason should state that the escaped income is likely to be Rs.1 Lakh or more so that the Chief Commissioner or the Commissioner may record his satisfaction. The sanctioning authority must be aware that it has exercised power of extended period of limitation under 149 (1) (b) of the Act. Exce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us and we failed to understand the filing of the rulings by the counsel as referred to herein above. The only point urged and pressed before us is whether in absence of anything in the reasons recorded to suggest that the income chargeable to tax which has escaped the assessment is Rs. one lakh or more having not been mentioned the reassessment notice given after four years of the close of the assessment order is valid or not. For the reasons given above, we find sufficient force in the argument of the learned counsel for the petitioner that on the basis of the reasons recorded by the Assessing Officer, the initiation of the reassessment proceedings relevant to the Assessment Year 2000-2001 by means of the notice dated 23.3.2007 a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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