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TMI Blog2017 (8) TMI 1604X X X X Extracts X X X X X X X X Extracts X X X X ..... dit wing to drop the proceeding, he cannot change his mind subsequently and issue notice under Section 148 for reopening assessment. No material is available on record to suggest that the Assessing Officer reopened the assessment due to change of circumstances after the reply dated 04.03.2014 requesting the audit wing of the Department to drop the audit objection. In the absence of any material, this Tribunal is of the considered opinion that the reopening of assessment is not justified. Therefore, the consequential assessment order passed by the Assessing Officer cannot stand in the eye of law. .Accordingly, the order of the Assessing Officer is quashed - Decided in favour of assessee. - ITA No.2276/Mds/2016 & C.O. No.129/Mds/2016 (in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is in the business of providing financial and marketing services in various sectors. The audit party of the Department found that Road Safety Club Pvt. Ltd. was in the business of selling safety cards. It was also found that all expenses on salary, staff training, etc. were incurred by the assessee at various offices and reimbursed by Road Safety Club Pvt. Ltd. The audit party ultimately found that an amount of ₹ 6,01,84,164/- has escaped assessment. 4. Referring to a reply filed by the assessee on 04.03.2014, a copy of which is available at page 43 of the paper-book, the Ld.counsel submitted that the Assessing Officer in categorical terms replied to the audit wing of the Department that outsourcing some of the activities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot be said that there was reason to believe that any income chargeable to tax has escaped assessment. Hence, according to the Ld. counsel, the reopening itself is not correct, therefore, the consequential assessment framed by the Assessing Officer cannot stand in the eye of law. 6. On the contrary, Shri Asish Tripathy, the Ld. Departmental Representative, submitted that the audit wing of the Department has brought to the notice of the Assessing Officer that there was escapement of income to the extent of ₹ 6,01,84,164/-. Though the assessee claims that it was business arrangement between two sister concerns, the audit party found that M/s Road Safety Club Pvt. Ltd. is making reimbursement for the expenses incurred by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year): Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax; (b) where a return of income has been furnished by the assessee but no assessment has been made and it is noticed by the Assessing Officer that the assessee has understated the income or has claimed excessive loss, deduction, allowance or relief in the return; (ba) where the assessee has failed to furnish a report in respect of any international transaction which he was so required under section 92E ; (c) where an assessment has been made, but-- (i) income chargeable to tax has been under assessed; or (ii) such income has been assessed at to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub Pvt. Ltd. was carried out by the assessee-company only is not correct. Enclosing the Profit Loss account of Road Safety Club Pvt. Ltd., the Assessing Officer requested the audit wing of the Department to drop the audit objection. Therefore, it is obvious that the Assessing Officer after applying his mind found that there was no escapement of income. Subsequently, the Assessing Officer issued notice under Section 148 of the Act for reopening the assessment. Therefore, this Tribunal is of the considered opinion that the Assessing Officer has not independently satisfied himself about the escapement of income. 9. The proceeding before the Assessing Officer is a judicial proceeding under Section 136 of the Act. Therefore, the reason to b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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