9911796707
TMI Blog2005 (2) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue: "Whether, on the facts and circumstances of the case, the Income-tax Appellate Tribunal, Bombay, is right in law in holding that the action of the Assessing Officer in reopening the assessment under section 147 of the Income-tax Act, 1961 is invalid and also in deletion of additions made on account of unproved loans and cash credits?" The relevant assessment year in the above is 1988-1989. It appears that the assessee had filed a return on March 25, 1991 and no regular assessment order was passed, however on October 10,1991, a notice was sent to the respondent-assessee under section 143(1) for reopening of the assessment under section 148 of the Income-tax Act. The relevant portion of the said notice dated October 10, 1991, reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turn, issued under section 143(2) of the Income-tax Act and ought not to have resorted to section 148 for reopening of the assessment. The main submission of the respondent-assessee was that the notice issued by the Assessing Officer dated October 10, 1991, as quoted hereinabove, only seeks to find out the source of the funds and the same does not constitute "any reason for the belief that the income had escaped the assessment", so as to invoke section 148 of the Income-tax Act. The Tribunal by its judgment and order dated October 15, 1999, had categorically come to a conclusion that if the Assessing Officer wanted to verify the correctness of the return and the details and particulars therein, he ought to have issued notice under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the part of the assessee to disclose fully and truly all material facts necessary for his assessment. If either of these conditions is not fulfilled, the notice issued by the Income-tax Officer would be without jurisdiction. The important words under section 147(a) are 'has reason to believe' and these words are stronger than the words 'is satisfied'. The belief entertained by the Income-tax Officer must not be arbitrary or irrational. It must be reasonable or in other words it must be based on reasons which are relevant and material. The court, of course, cannot investigate into the adequacy or sufficiency of the reasons which have weighed with the Income-tax Officer in coming to the belief, but the court can certainly examine whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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