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TMI Blog2017 (9) TMI 1223X X X X Extracts X X X X X X X X Extracts X X X X ..... e. In the present case, a perusal of reasons for initiating reassessment proceedings clearly show that they are against the sprit of provisions of section 147 of the Act. The Assessing Officer has issued notice u/s. 148 on the directions of JCIT and CIT. Therefore, in our considered opinion the notice issued u/s. 148 is bad in law and thus, the subsequent proceedings arising there from are vitiated. Appeal of assessee is allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... escaped assessment. It is the opinion and belief of the Assessing Officer which ignites reassessment proceedings and not the directions of any other superior authority. Further, the ld. AR submitted that the Assessing Officer has violated the law laid down by Hon'ble Supreme Court of India in the case of GKN Driveshafts (India) Ltd. Vs. Income Tax Officer & Ors. reported as 259 ITR 19. The Hon'ble Apex Court has mandated that after issuance of notice u/s. 148, the proper course of action for the noticee is to file return and if he so desires, seek reasons for issuing notice. The Assessing Officer is bound to furnish reasons within a reasonable time. The assessee is thereafter required to file objections. The Assessing Officer before proceeding with the assessment has to dispose of the objections filed by the assessee by passing a speaking order. In the present case, the notice u/s. 148 was issued to the assessee on 19-01-2012. The assessee vide letter dated 07-02-2012 requested for providing reasons for reopening the assessment. The Assessing Officer without supplying the reasons for reopening, issued notice u/s. 143(2) on 30-07-2012 followed by notice u/s. 142(1) on 11-09-2012. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... infructuous as the Commissioner of Income Tax, Thane had invoked the provisions of section 263 and has set aside the assessment order dated 25-03-2013 passed u/s. 143(3) r.w.s. 147 of the Act. validity of reopening before deciding the issue on merits. To support his submissions, the ld. AR placed reliance on the decision of Delhi Bench of the Tribunal in the case of Ballarpur Industries Ltd. Vs. Income Tax Officer reported as 80 taxmann.com 79. The ld. AR finally contended that the Commissioner of Income Tax (Appeals) has erred in dismissing the appeal of assessee as infructuous as the Commissioner of Income Tax, Thane had invoked the provisions of section 263 and has set aside the assessment order dated 25-03-2013 passed u/s. 143(3) r.w.s. 147 of the Act. 4. On the other hand Shri Rajeev Kumar representing the Department strongly defended the impugned order. The ld. DR submitted that once the assessment order impugned by the assessee in present appeal has been set aside by the Commissioner of Income Tax in revision proceedings, the present appeal filed by the assessee does not survive. The ld. DR further contended that reassessment proceedings were carried out in a fair manner. P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee has wrongly manipulated the benchmarking of its international transactions relating to its medical imaging activity. The Jt. CIT, Range-1, Thane, as per directions, has informed this office on 13.01.2012 to issue necessary notice. Armed with the Transfer Pricing information, the CIT-1, Thane too, vide letter No.THN/CIT-1/TP/AI/2011-12/2395 dated 16.01.2012, has given directions to take necessary action. Based on the above facts and perusal of the information, it is seen that the assessee has overpaid its AE in transaction of import from AE relating to medical imaging segment. The difference had been worked out after holding the benchmark margin of 4.17%. The communication received from the Addl.CIT, Transfer Pricing-1(1), Mumbai is self explanatory in this aspect. As per requirements by the law, the assessee was required to benchmark each international transaction separately. The assessee has clubbed the international transactions of medical imaging segments with its entity level results wherein income has escaped assessment. Considering the above facts, I have reason to believe that income chargeable to tax has escaped assessment due to the proceedings conducted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eopen a completed assessment." A perusal of above observations of Hon'ble High Court makes it unambiguous clear that 'reason to believe'that income chargeable to tax has escaped assessment should be of Assessing Officer. It is Assessing Officer's 'reason to believe' that taxable income has escaped assessment that forms bedrock for reopening assessment u/s. 147 of the Act. Directions from JCIT or CIT to issue notice cannot in any manner be construed as Assessing Officer's 'reason to believe' for initiating reassessment proceedings. The provisions of section 147 in unambiguous terms mandates that the 'reason to believe' for reopening assessment should be of Assessing Officer. In other words the Assessing Officer should carryout independent exercise to examine fresh material in his possession to come to a conclusion that the assessment warrants reopening on account of escapement of income. In the present case, a perusal of reasons for initiating reassessment proceedings clearly show that they are against the sprit of provisions of section 147 of the Act. The Assessing Officer has issued notice u/s. 148 on the directions of JCIT and CIT. Therefore, in our considered opinion the notic ..... 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