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TMI Blog2021 (11) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... borrowing in unaccounted cash being operated at the premises of M/s Evergreen Enterprises - HELD THAT:- There is absolutely no mention as to how either the partners of M/s Evergreen Enterprises or the employees of Ms/ Evergreen Enterprises or this Bharat Sanghavi is connected to petitioner. Mr. Suresh Kumar relied upon the affidavit in reply to submit that Bharat Sanghavi was an employee of petitioner and, therefore, the reasons have been correctly recorded and the Assessing Officer has reason to believe that income had escaped assessment. As noted earlier, the reasons for reopening of assessment has to be tested / examined only on the basis of the reasons recorded and those reasons cannot be improved upon and/or submissions much less su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause notice has been issued four years after the assessment order, what was the material fact that was not fully and truly disclosed. 2. With the assistance of Mr. Agarawal we have perused the reasons for issuance of notice under Section 148 of the Income Tax Act, 1961 (the said Act), which was given to petitioner vide letter dated 2nd May 2019. We would agree with petitioner. 3. The law on this is well settled. To confer jurisdiction under Section 147 (a), two conditions were required to be satisfied, firstly the Assessing Officer must have reasons to believe that income, profits or gains chargeable to income tax had escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of eithe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments Vs. Assistant Commissioner of Income Tax Writ Petition No.2760 of 2019 dated 24th August 2021) 5. It is also settled law that the Assessing Officer has no power to review an assessment which has been concluded. If a period of four years has lapsed from the end of the relevant year, the Assessing Officer has to mention what was the tangible material to come to the conclusion that there is an escapement of income from assessment and that there has been a failure to fully and truly disclose material fact. After a period of four years even if the Assessing Officer has some tangible material to come to the conclusion that there is an escapement of income from assessment, he cannot exercise the power to reopen unless he discloses what ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing officer. The reasons recorded should be self-explanatory and should not keep the assessee guessing for the reasons. Reasons provide link between conclusion and evidence. The reasons recorded must be based on evidence. The assessing officer, in the event of challenge to the reasons, must be able to justify the same based on material available on record. He must disclose in the reasons as to which fact or material was not disclosed by the assessee fully and truly necessary for assessment of that assessment year, so as to establish vital link between the reasons and evidence. That vital link is the safeguard against arbitrary reopening of the concluded assessment. The reasons recorded by the assessing officer cannot be supplemented by f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has lent cash of ₹ 30,00,000/-. It is alleged that petitioner has lent cash loan of ₹ 30,00,000/- in Financial Year 2011- 2012 and therefore, petitioner has been indulging in lending of cash loan and therefore, the amount of ₹ 30,00,000/- has escaped assessment within the meaning of Section 147 of the Act. For ease of reference, the reasons is scanned and reproduced hereinbelow: Therefore, there is absolutely no mention as to how either the partners of M/s Evergreen Enterprises or the employees of Ms/ Evergreen Enterprises or this Bharat Sanghavi is connected to petitioner. Mr. Suresh Kumar relied upon the affidavit in reply to submit that Bharat Sanghavi was an employee of petitioner and, therefore, the reasons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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