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TMI Blog2021 (6) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... tent of the assessee's contribution. Since the facts set out in the Sale Deed cognizance of which was taken by the Assessing Officer himself while making the addition were un-disputably clear the conclusion that admittedly its proper consideration escaped the notice of not only the A.O. but the approving authority also is clearly evident from record. Thus not finding fault in the manner of the specific words recorded in the order to grant approval, which has been the crux of ld AR's argument the objection is sustained on the fact that no care or attention evidently was taken to consider the bare preliminary facts itself and the power was exercised mechanically without examining the record. An authority vested with the onerous powers of re-opening u/s 147 and granting of approval is expected to exercise its power consciously, carefully and with full awareness. The public at large cannot be put to the mercies of careless, casual, arbitrary or whimsical exercise of power. The order deserves to be quashed on this count itself. On a careful consideration of explanation offered right at the assessment stage partially recorded as find that even on merits the assessee has suffic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on the merits of the addition made. 3. Addressing the respective orders of the tax authorities, the ld. AR challenged the order on the ground that the order for want of jurisdiction deserves to be quashed as notice to the assessee was never issued by the Assessing Officer. This challenge, it was submitted remains un-assailed on record. Jurisdiction was also challenged on the grounds of being arbitrary as it was exercised mechanically. It was submitted this fact was evident from the record itself as no effort, as a matter of record was made to see the actual proportionate share of the assessee's contribution and the reasons recorded would show that entire hundred percent investment in the property was wrongly considered to have been made by the assessee. This mistake and incorrect fact recorded in the reasons recorded, it was submitted, had been corrected by the Assessing Officer himself at the assessment stage as ultimately addition was made to the proportion relatable to the assessee's share. The said addition is also challenged on merits. However, reverting to the jurisdictional challenge, it was argued that the approval was mechanically given by the approving autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the CIT(A), Karnal, and duly explained that the proceedings itself were void in case of the appellant; in the absence of valid service of notice u/ s 148 in the absence of valid reasons to believe for reopening the case u/s 148 in the absence of valid satisfaction of the Pr. CIT, Karnal for reopening the case u/s 148 besides the fact that the sources of purchase of property were duly submitted to the AO, which were ignored by the Worthy CIT(A) and the case was decided against the facts and circumstances of the case. 5. The legal challenge addressed vide ground No. 1 to 5 as set out in page 2 of the synopsis was referred to so as to set out the following facts : A. Issue of Notice u/s 148 of the Act for re-assessment proceedings u/sec 147 of the Act being Void Ab initio, being based on notice which was never served on the assessee and B. Notice u/s 148 issued without any valid 'reasons to believe', which is clearly evident from the fact that the income alleged as escaped in the reasons being ₹ 63.51 lacs of purchase consideration was itself revised to ₹ 28.04 lacs at the time of assessment finalization. C. Issue of reopening of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income Tax V/s Chetan Gupta 62taxmann.com249 DEL-HC (Pages 15-29 of Jug Set) Shri Rathi Steel Ltd. V/s Assistant Commissioner of Income Tax 104 taxmann.com 400 Del-Trib. (Pages 9-14 of the Jug Set) Charan Singh V/S Ito Ward- Bhiwadi Of The ITAT, Jaipur Bench Ita No. 906/JP/2018 (Pages 1-8 of the Jug Set) CIT Vs. Naveen Chander (P H HC) 323 ITR 49 S Wg. Cdr. Sucha Singh Vs. Ito As Reported in Ita No. 1605/Del/2012 Moreover, the contention of the AO, in Para 6 (Page 3) of his order, that since the Assessee attended the assessment proceedings and filed a return u / s 148 of the Act, the service of notice can be assumed to have been made is wrong and is against the facts of the case. Ld. AO has mistaken in assuming the bonafide act of the assessee to abide by the proceedings of income tax department, after he got to know about such proceedings in his case through service of notices u/s 142(1) of the act, as the waiver of his rights to challenge the jurisdiction assumed by the AO without service of notice u/s 148, which is against the facts and circumstances of the case. Judgement relied by AO CIT(A) Distinguished: V.R.A. Cotton Mills (P.) Ltd. report ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asons, to be an invalid notice, in keeping with the decision of the Hon'ble Supreme Court in 'Kelvinator of India Ltd.' (supra), as considered in 'Dr. Ajit Gupta' (supra). Consequently, all proceedings pursuant thereto, culminating in the impugned order for the A.Y. 2007-08, are also field to be null and void. Baba Kartar Singh Dukki Educational Trust v. ITO (2016) 158 ITD 965 (Chd.)(Trib.) Reasons to Suspect and Not Reasons to Believe The fact that the amount alleged in reasons to believe as having escaped assessment was revised during the assessment proceedings clearly shows that the reasons were actually reasons to suspect and made with the intent of making roving enquiries without any evidence against the assessee in this regard, which is prohibited by law. Further reliance in this regard is placed on the following judgements, wherein for missing 'reasons to believe', the assessments were reduced to nullity, namely: Amrik singh vs ITO reported at 142 DTR 6 ASR-Trib.) Placed at Pages 51-64 of Jud. Set Holy Faith International Pvt. Ltd. vs DCIT in ITA no. 181/Asr/2017 Asr-Trib. Placed at Pages 75-89 of the Jug. Set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at Pages 39-40 of the PB and copy of list of remittances placed at Page 46 of the PB. Also, the copy of the relevant extract of hand written diary being furnished separately for your ready reference. However, the without any giving any benefit of such evidences placed on record and without any finding of fact against the assessee that she had i come from any other source during the relevant period the contention of assessee was rejected by the AO and no benefit was given to her for the sources shown by her. Infact, the sources explained have been added by the AO as the income of the assessee instead of the share of the assessee in the purchase of such property luring the relevant year, clearly showing the carelessness and gross un-justice done to the assessee at the hands of the AO. Other than the above the assessee and her husband had household savings from the agricultural income of the husband of the assessee and remittances received from their son in the past, sample J forms placed at Pages 31-38 of the PB) ITA 220/CHD/2019 A.Y. 2010-11 Thus, the fact remains that the sources of the investment in the impugned property for the share of the assessee was duly explaine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its challenge that notice was not issued as it has not been served. The tax authorities have rejected the challenge holding that non-receipt is not equivalent to non-service. It is seen that though the challenge is recorded the wording in its rejection has been remained ambivalent as no specific finding is found to have been given holding that the notice was issued on a specific date. Nor is there any reference addressing the mode and manner of its issuance nor the fact that it was issued at the correct address. In order to hold that the notice was issued, these above facts need to be recorded and available on record so as to enable an ITA 220/CHD/2019 A.Y. 2010-11 adjudicating authority to conclusively uphold the finding as otherwise sans facts the conclusion is open to the challenge of being arbitrary dehors facts and hence non-maintainable. Thus, though the dismissal of the ground in the manner worded in the face of the challenge does not inspire much confidence in its correctness, however, even otherwise, I find that the assessee has a good case on the legal challenge posed as well as on merits. No doubt mention of the full investment value finds a mention in the reason to bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explanation offered right at the assessment stage partially recorded in the order, I find that even on merits the assessee has sufficiently explained the availability of funds. Specific reference is made to the explanation offered at the first instance before the AO itself: TOTAL AMOUNT OF PURCHASE-DEED ₹ 65.51.000/-. I purchased agri. land measuring 24 kanals at Village Saraswati Khera along-with other co- sharers Surinder Kaur, Satvinder Kaur, Baljinder Kaur Ravinder Kaur, residents of Village Nivarsi, tehsil Thanesar for ₹ 63,51,000/- + 190000/- stamp-duty and my share of investments comes out of ₹ 27,81,000/-, the above co-sharers invested the amount of their share themselves, document was registered as per collector-rate. Sir, as per facts of the case, the above land was under the possession of third-parties but we did not pay the amount to the sellers as per the amount written in purchase-deed but paid the amount much lessor, I am enclosing the documents of civil-suit, court-order and the order of concerned Tehsildar for your kind consideration. 2. SOURCE OF INVESTMENT:- I am house-wife, my husband is retired employee of Haryana roadw ..... 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