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TMI Blog2015 (4) TMI 304X X X X Extracts X X X X X X X X Extracts X X X X ..... 2), Jaipur, by which its objections filed thereagainst were rejected. Petitioner-assessee filed its return for assessment year 2007-08 on 29.10.2007 declaring income of Rs. 1,86,790/- and paid the due tax thereon as per the provisions of the Income Tax Act, 1961 (for short, 'the IT Act'). Aforesaid return filed by petitioner-assessee was selected for scrutiny assessment and notices under Section 142(1) and 143(2) were issued on 26.09.2008. The Income Tax Officer, after detailed scrutiny and verification, passed an order dated 06.11.2009 under Section 143(3) of the IT Act. Petitioner-assessee challenged aforesaid order before the Commissioner of Income Tax (Appeals), Jaipur-I, Jaipur, who allowed the same in part after making trading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obtaining sanction. Respondent no.2 ITO, vide letter dated 02.01.2015, provided copy of sanction obtained from Joint Commissioner of Income Tax, Range-1, Jaipur, vide letter dated 27.03.2014. Petitioner-assessee submitted objection against notice under Section 148 of the IT Act, which has been rejected by impugned order dated 15.01.2015. Shri Siddharth Ranka, learned counsel appearing for petitioner-assessee, submitted that there was no failure on the part of petitioner-assessee to disclose fully and truly all material, primary and relevant facts necessary for assessment for assessment year 2007-08. There was no valid reason to believe with the respondents that any income chargeable to Tax has escaped assessment within the meaning of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal assessment stage considered all the material evidence and documents submitted by petitioner-assessee and after due verification and satisfaction passed detailed assessment order under Section 143(3) of the IT Act. Thus, there was no basis with respondent ITO to issue notice under Section 148 of the IT Act. Learned counsel argued that respondent ITO supplied reason to petitioner-assessee and sought to justify the order rejecting the objections submitted by petitioner-assessee to notice under Section 148 of the IT Act, vide the order dated 15.01.2015, and has alternatively maintained that required sanction from Commissioner of the Income Tax Department was not taken due to oversight because assessment of petitioner-assessee has alread ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jecting the objections and from the information received by the Income Tax Department during search and survey proceedings carried out by them, that petitioner-assessee has been involved in obtaining bogus purchase bills and accommodation entries to deflate its profit and to show fictitious expenses. Relying on judgment of the Supreme Court in Rajesh Jhaveri Stock Brokers Private Limited - (2007) 291 ITR 500 (SC), it was argued that expression "reason to believe" in Section 147 of the IT Act would mean "cause or justification to know" and if the assessing officer has cause or justification to know or suppose that income has escaped assessment, he can be said to have reason to believe that income has escaped assessment. Whether or not the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n issued by Joint Commissioner, Income Tax, Range-I, Jaipur. Dealing with similar controversy, Allahabad High Court in Reliable Finhold Limited, supra, has held that where assessment was sought to be reopened beyond the period of four years of the end of the relevant assessment year and if the assessee objected that since original order of assessment was made under Section 143(3), no notice could have been issued without sanction of Chief Commissioner or the Commissioner. The assessee was supplied information under Right to Information Act that no such sanction was obtained. The writ petition was allowed by the Allahabad High Court holding that the proviso to sub-section (1) of Section 151 was attracted. It was held that entire exercise of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to show cause-notice under Section 148 of the IT Act has been rejected by the Income Tax Officer by impugned order dated 15.01.2015 citing, apart from various reasons, also the reason that required sanction of Commissioner of Income Tax was not taken due to oversight that assessment of the assessee firm had already been completed under Section 143(3). It was stated that mistake was committed inadvertently and is curable by recourse to Section 292B of the IT Act. That plea is liable to be rejected because when specific provision has been inserted to the proviso to Section 151 (1), as a prerequisite condition for issuance of notice, namely, sanction of the Commissioner or the Chief Commissioner, the assessing officer cannot find escape rou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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