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TMI Blog2018 (11) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... return was accepted without scrutiny under Section 143(1) of the Income Tax Act, 1961 (for short "the Act"). To re-open such assessment, impugned notice came to be issued by the Assessing Officer on 31.3.2018. In order to do so, the Assessing Officer had recorded following reasons: "The assessee Smt. Purvi Snehal Pachchigar having her address at 10 Meghdoot Society, Athwalines, Surat derived income from house property, business income and income from other sources during the year under consideration. The Assessee is assessed under the PAN - ABRPP2820M. The assessee had filed return of income for A.Y. 2013-14 on 08.10.2013 declaring total income of Rs. 3,10,980/-. During the year, the assessee has shown income from house property Rs. 2,26 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the petitioner raised following contentions: (1) There is no material to come to the conclusion that income in case of the assessee has escaped assessment. (2) The Assessing Officer has proceeded entirely on the basis of the information supplied to it and the investigation is going on without making any independent inquiry on its own. The Assessing Officer has thus proceeded on the borrowed satisfaction. (3) The Assessing Officer wishes to make fishing inquiry. 4. For the reasons recorded hereafter, we are not inclined to interfere. Perusal of the reasons recorded by the Assessing Officer would suggest that the petitioner had shown to sold scrip of one TURBO TECH Company for a sale consideration of Rs. 1.33 crores rounded off an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to examine whether the Assessing Officer had formed a valid belief on the basis of the material available with him that income chargeable to tax had escaped assessment. Both these aspects have been examined by the Supreme Court in Assistant Commissioner of Income Tax v. Rajesh Jhaveri Stock Brokers P. Ltd. [{2007) 291 ITR 500 (SC)] of which following observations may be noted: "13. One thing further to be noticed is that intimation under section 143(1)(a) is given without prejudice to the provisions of section 143(2). Though technically the intimation issued was deemed to be a demand notice issued under section 156, that did not per se preclude the right of the Assessing Officer to proceed under section 143(2). That right is preserved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... portunity of being heard is given under section 143(1)(a) indicates that the Assessing Officer has to proceed accepting the return and making the permissible adjustments only. As a result of insertion of the Explanation to section 143 by the Finance (No. 2) Act of 1991 with effect from October 1, 1991, and subsequently with effect from June 1, 1994, by the Finance Act, 1994, and ultimately omitted with effect from June 1, 1999, by the Explanation as introduced by the Finance (No. 2) Act of 1991 an intimation sent to the assessee under section 143(1) (a) was deemed to be an order for the purposes of section 246 between June 1, 1994, to May 31, 1999, and under section 264 between October 1, 1991, and May 31, 1999. It is to be noted that the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owledgment of the return shall be deemed to be an intimation under section 143(1) where (a) either no sum is payable by the assessee, or (b) no refund is due to him. It is significant that the acknowledgment is not done by any Assessing Officer, but mostly by ministerial staff. Can it be said that any assessment is done by them? The reply is an emphatic no. The intimation under section 143(1)(a) was deemed to be a notice of demand under section 156, for the apparent purpose of making machinery provisions relating to recovery of tax applicable. By such application only recovery indicated to be payable in the intimation became permissible. And nothing more can be inferred from the deeming provision. Therefore, there being no assessment under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls would conclusively prove the escapement is not the concern at that stage. This is so because the formation of belief by the Assessing Officer is within the realm of subjective satisfaction (see ITO v. Selected Dalurband Coal Pvt. Ltd. [1996 (217) ITR 597 (SC)] ; Raymond Woollen Mills Ltd. v. ITO [1999 (236) ITR 34 (SC)]." 7. This aspect have also been reiterated by the Supreme Court in the later judgment in the case of Deputy Commissioner of Income Tax and another v. Zuari Estate Development and Investment Company Limited [(2015) 373 ITR 661 (SC)]. 8. In the present case the Assessing Officer has heard the material on record which would prima facie suggest that the assessee had sold number of shares of a company which was found to be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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