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TMI Blog2020 (1) TMI 300X X X X Extracts X X X X X X X X Extracts X X X X ..... here are sufficient reasons given by the Assessing Officer, which according to him is Reasons to believe of an income of more than ₹ 87 Lakhs, which are chargeable to tax has escaped assessment and which has come to the notice of Department at a later stage in the course of scrutiny. Given the said facts and circumstances of the case, this Court has no hesitation to reach to the conclusion that there was sufficient material available before the authority concerned for initiating a proceeding under Section 147 of the I.T. Act and the same cannot be held to be bad in law as the proceedings drawn by the Assessing Officer seems to be with sufficient material in record showing income, which otherwise is chargeable to tax having escaped assessment. - Writ Petition (T) No. 141 of 2019 - - - Dated:- 20-12-2019 - Shri P. Sam Koshy J. For Petitioner: Shri Sumit Nema, Sr. Advocate along with Shri Raja Sharma, Advocate. For Respondents: Smt. Naushina Ali, Shri Ajay Kumrani and Shri Topilal Bareth, Advocates. C.A.V. Order 1. Challenge in the present writ petition is the notice dated 06.05.2019 issued by the Respondent No.3. Vide the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ression of material facts during the course of scrutiny of assessment under Section 143(iii) of the Act. It was further contended by the petitioner that law is also well settled that even if there is a change of opinion, the proceeding of reassessment under Section 147 of the Act could not have been initiated. 6. It was also contended that the reasons to believe provided by the department are all vague, ambiguous and without any basis and there being no tangible material to support the reasons to believe. There is also no objective finding or reasons given by the authorities while giving reasons and also while rejecting the objections preferred by the petitioner. 7. The counsel for the petitioner relied upon ( 2018) 404 ITR 0010 Supreme Court in case of Income Tax Officer Vs. Taxman India Pvt. Ltd., in (2006) 283 ITR 212 in case of Taxman India Vs. Income Tax Officer passed by Delhi High Court, judgment of Bombay High Court in WP No. 546 of 2018 Rajbhushan Omprakash Dixit Vs. Dy. Commissioner, Income Tax wherein it has all been held that if the AO, for some reason, did not advert to such material or did not utilize the same, it cannot be said that the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have been made showing payments of bribe/illegal gratification to the officers in the PWD department and such payments made from unexplained source are not reflected in the books of account, which led to such income escaping assessment and which has necesiated issuance of the order of reassessment. According to the counsel for the department, all these facts are sufficient to draw a prima facie strong case of the assessee not disclosing full and true material during the regular assessment. 12. The counsel for the respondents relied upon the judgments passed in the case of M/s. Phool Chand Bajrang Lal and Another v. Income Tax Officer and Another 1993(4)SCC 77, Income Tax Officer, Jodhpur v. Purushottam Das Bangur and Another 1997(3)SCC 253, Income Tax Officer, Calcutta v. Selected Dalurband Coal Co. Pvt. Ltd. 1997(10)SCC 68, Assistant Commissioner of Income Tax v. Rajesh Jhaveri Stock Brokers Private Limited 2008 (14) SCC 208, and Deputy Commissioner of Income Tax and Another v. Zuari Estate Development and Investment Company Limited 2015 (15) SCC 248. 13. Given the said facts, now if we come to the findings of the Assessing Officer or the reasons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act does not prescribe a precondition of the material not having been disclosed in the course of assessment at the first instance. 17. The overall reading of Section 147 of the Act would show that wide powers have been given upon the Assessing Officer to reach to the conclusion of there being sufficient reasons to believe that income chargeable to tax had escaped assessment. It could even cover cases where assessee has fully disclosed the material facts. This view of the court stands fortified from the Division Bench judgment of Punjab Haryana High Court in case of Jawand Sons Vs. Commissioner of Income Tax (2010) 195 Taxman 144. The Division Bench of Delhi High Court in case of Consolidated Photo and Finvest Ltd. Vs. Assistant Commissioner of Income Tax (2006) 281 ITR 394, has also held that action under Section 147 of the Act was permissible even if the Assessing Officer gathered his reasons to believe from the same record as had been the subject matter of the completed assessment proceedings. Mere production of books of account is not sufficient to infer that there had been full disclosure of material facts necessary for the purpose of assessment. Once, if in the opi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax Officer Azamgarh rightly initiated the reassessment proceedings on the basis of subsequent information, which was specific relevant and reliable, and after recording the reasons for formation of his own belief that in the original assessment proceedings, the assessee had not disclosed the material facts truly and fully and therefore income chargeable to tax had escaped assessment. He, therefore, correctly invoked the provisions of Sections 147(a) and 148 of the Act. The High Court was, thus, perfectly justified in dismissing the writ petition. There is no merit in this appeal which fails and is dismissed but with no order as to costs. 19. Again in case of Income Tax Officer, Calcutta Vs. M/s Selected Dalurband Coal Co. Pvt. Ltd. 1997 (10) SCC 68 , in paragraph 3 held as under: 3. It is well settled by various decisions of this Court that the notice under Section 148 read with Section 147 can be issued only where the Income- tax Officer has reason to believe that the income profits or gains chargeable to tax had been under-assessed or escaped assessment and further that such escapement or under assessment was occasioned by reason of the failure of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld 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 Co. Pvt. Ltd. [1996 (217) ITR 597 (SC)]; Raymond Woollen Mills Ltd. v. ITO [ 1999 (236) ITR 34 (SC)]. 21. 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 substitution. Under the old provisions of section 147, separate clauses (a) and (b) laid down the circumstances under which income escaping assessment for the past assessment years could be assessed or reassessed. To confer jurisdiction under section 147(a) two conditions were required to be satisfied firstly the Assessing Officer must have reason to believe that income profits or gains chargeable to income tax have escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of either (i) omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. B ..... X X X X Extracts X X X X X X X X Extracts X X X X
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