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TMI Blog2022 (5) TMI 1442X X X X Extracts X X X X X X X X Extracts X X X X ..... ve material emerges at a later stage. We find no substance in the Revenue s instant argument as well in light of Bir Bahadur Singh Sijwali[ 2015 (2) TMI 60 - ITAT DELHI] it is of the considered view that the reasons recorded by the Assessing Officer, as set out earlier, were not sufficient reasons for reopening the assessment proceedings. We, therefore, quash the reassessment proceedings - Decided in favour of assessee. - ITA No.452/PUN/2019, ITA Nos.453 & 454/PUN/2019 - - - Dated:- 31-5-2022 - SHRI S.S.GODARA, JUDICIAL MEMBER Appellant by Shri Suhas Bora Respondent by Shri Arvind Desai ORDER PER S.S. GODARA, JM : The twin assessees three appeals for AYrs 2012-13 2010-11, as the case may be, arise against the CIT(A)-12 Pune s separate orders dated 31-12-2018 27-12-2018 in case Nos. PN/CIT(A)-12/10770, 10779/2016-17 and PN/CIT(A)- 12/10793.10801/2016-17 involving proceedings under section 143 r.w.s. 147 of the Income Tax Act, 1961 in short the Act , respectively. Heard assessees as well as the department. Case files perused. 2. It is noticed first of all that the assessees respective pleadings challenge correctness of the learned lowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without any scope of addition, deletion or substitution therein even if supportive material emerges at a later stage. 4. Mr. Desai sought to buttress the point that these assesses have been found to have made cash deposits in their respective bank accounts. I find no substance in the Revenue s instant argument as well in light of Bir Bahadur Singh Sijwali Vs. ITO (2015) Tax Corp (AT) 39421 (ITAT-DELHI) held as under : 5. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. 6. A plain look at the reasons for reopening the assessment, as produced before us, show that these reasons were recorded after the notice was served on 14th September 2009 as a mention about the fact of service of notice is set out in the recorded reasons itself. It is only elementary that the reasons are to be recorded before issuance of notice, and in the absence of any reasons for reopening having been recorded prior to reopening of assessment, the reassessment proceedings fail for this short reason alone. Hon ble Bombay High Court, in the case of Prashant S. Joshi vs. ITO [(2010) 230 CTR (Bom) 232. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is only on this basis that the Assessing Officer can form the belief that an income has escaped assessment. Merely because some further investigations have not been carried out, which, if made, could have led to detection to an income escaping assessment, cannot be reason enough to hold the view that income has escaped assessment. It is also important to bear in mind the subtle but important distinction between factors which indicate an income escaping the assessments and the factors which indicate a legitimate suspicion about income escaping the assessment. The former category consists of the facts which, if established to be correct, will have a cause and effect relationship with the income escaping the assessment. The latter category consists of the facts, which, if established to be correct, could legitimately lead to further inquiries which may lead to detection of an income which has escaped assessment. There has to be some kind of a cause and effect relationship between reasons recorded and the income escaping assessment. While dealing with this aspect of the matter, it is useful to bear in mind the following observations made by Hon ble Supreme Court in the case of ITO Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ks the fact that the sources of deposit need not necessarily be income of the assessee. Of course, it may be desirable, from the point of view of revenue authorities, to examine the matter in detail, but then reassessment proceedings cannot be resorted to only to examine the facts of a case, no matter how desirable that be, unless there is a reason to believe, rather than suspect, that an income has escaped assessment. 9. Learned Departmental Representative has referred to a number of judicial precedents in support of her stand that even deposits in the bank account, as having come to the notice of the Assessing Officer through AIR, can be reason enough for holding the belief that income has escaped assessment. She has relied upon the decisions in the cases of CIT Vs Nova Promoters Finlease Pvt Ltd [(2012)342 ITR 169] but then none of the questions before Hon ble High Court had anything to do with reopening of assessment and this decision cannot, therefore, be taken as an authority on the legal issue which did not even come up for specific adjudication before Their Lordships. As for her reliance on Hon ble Supreme Court s judgment in the case of Phool Chand Bajrang Lal Vs ITO ..... X X X X Extracts X X X X X X X X Extracts X X X X
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