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TMI Blog2018 (4) TMI 1287X X X X Extracts X X X X X X X X Extracts X X X X ..... ed position in law that reopening notice has to be issued by the Assessing Office on his own satisfaction and not on borrowed satisfaction. The view taken by the impugned order of the Tribunal cannot be found fault with. This view of the Tribunal is in accordance with the settled position in law. - Income Tax Appeal No. 1297 of 2015 - - - Dated:- 16-4-2018 - M.S. SANKLECHA SANDEEP K. SHINDE, JJ. Mr. N. C. Mohanty, for the Appellant. Mr. Nitesh Joshi i/b. Mr. Sameer Dalal, for the Respondent. P.C: This Appeal under Section 260A of the Income Tax Act, 1961 (the Act), challenges the order dated 12th December, 2014, passed by the Income Tax Appellate Tribunal (the Tribunal). The impugned order dated 12th December, 2014 is in respect of Assessment Year 2003-04. 2. Revenue urges the following question of law, for our consideration: Whether on the facts and in the circumstance of the case and in law, the Tribunal was justified in law in holding that the reopening of Assessment is not sustainable in law? 3. The Respondent is a company, engaged in Investment and Trading in shares and debentures. For the subject Assessment Year 2003-04, the Respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to believe that there is escapement of the income within meaning of u/s. 147 of the I.T. Act, 1961. As per proviso of section 151(2) of the I.T. Act, no notice u/s. 148 issued by the assessing officer below the rank of the J.C. after the expiry of 4 years from the end of relevant A.Y. unless the Joint CIT is satisfied on the assessee recorded by the AO that it is fit case for the issue of such notice. In view of the above, sanction of issue of notice u/s. 148 of the I.T. Act, 1961 for A.Y. 2003-04 may be accorded if deemed fit. On the basis of the above reasons as recorded, the impugned order of the Tribunal found that the reasons proceed on the basis that there was no assessee such as Respondent in its charge. Nevertheless, the reopening notice was issued to the Respondent-Assessee. It further holds that the reasons as recorded did not indicate any application of mind on the part of the Assessing Office to the information received from the DDIT (Investigation). It observes that the reason as recorded only records that intimation received from the DDIT (Inv.) only mentions that the Mahasagar Securities Pvt. Ltd., was engaged in suspicious transactions. However, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, on the above ground itself, the question as proposed does not give rise to any substantial question of law as it is covered by the decision of this Court in Videsh Sanchar Nigam Ltd., (supra) against the Revenue in the present facts. 10. Besides, the submissions made on behalf of the Revenue that in view of the decision of the Apex Court in Rajesh Jhaveri Stock Brokers Pvt. Ltd., (supra), the Assessing Officer is entitled to reopen the Assessment for whatever reasons and the same cannot be subjected to jurisdictional review, is preposterous. First of all, taking out a word or sentence from the entire judgment, divorced from the context and relying upon it, is not permissible (see CIT v/s. Sun Engineering Works (P) Ltd., 198 ITR 297 ). It may be useful to reproduce the context in which the sentence in Rajesh Jhaveri Stock Brokers Pvt. Ltd., (supra) being relied upon by the Revenue to support its case, was made. The context, is as under: The scope and effect of section 147 as substituted with effect from April 1, 1989, as also sections 148 to 152 are substantially different from the provisions as they stood prior to such substitutions. Under the old provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e evident from the fact that in para 16 of the decision in Rajesh Jhaveri Stock Brokers Pvt., Ltd., (supra), it is observed that the word 'reason' in the . 'reason to believe' would mean cause or justification. Therefore, it can only be the basis of forming the belief However, the belief must be independently formed in the context of the material obtained that there is an escapement of income. Otherwise, no meaning is being given to the words 'to believe' as found in Section 147 of the Act. Therefore, the words 'whatever reasons' in Rajesh Jhaveri Stock Brokers Pvt. Ltd., (supra), only means whatever the material, the reasons recorded must indicate the reasons to believe that income has escaped assessment. This is so as reasons as recorded alone give the Assessing Officer power to reopen an assessment, if it reveals/ indicate, reasons to believe that income chargeable to tax has escaped assessment. 12. The reopening of an Assessment is an exercise of extraordinary power on the part of the Assessing Officer, as it leads to unsettling the settled issue/assessments. Therefore, the reasons to believe have to be necessarily recorded in terms of Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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