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TMI Blog2024 (3) TMI 253X X X X Extracts X X X X X X X X Extracts X X X X ..... and hence, such verification is necessary. Just because some information has been received from CIB does not entitle the AO to reopen assessment. The reasons must be founded on the satisfaction of the AO that income chargeable to tax has escaped assessment. Once that is not to be found, then, the impugned notice cannot be sustained. As noted earlier, what we find is that there are no reasons to believe but only reasons to suspect. Hence, reopening of assessment is not satisfactory. Decided in favour of assessee. - K. R. SHRIRAM DR. NEELA GOKHALE, JJ. For the Petitioner : Ms. Chandni J. Ahuja,. For the Respondents-Revenue : Mr. Prakash Chhotaray. ORAL JUDGMENT (PER K.R. SHRIRAM, J.) : 1. Petitioner, a Chartered Accountant by profession, had filed return of income for Assessment Years 2010-2011, 2011-2012 and 2012- 2013. The return for all the three years were processed under Section 143(1) of the Income Tax Act, 1961 (the Act). Thereafter, petitioner received identically worded notices all dated 20th March 2015 for Assessment Years 2010-2011, 2011-2012 and 2012-2013 seeking to reopen the assessment of those years. The reasons in support of the impugned notices are also identical, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner was having huge transactions in shares. This information led the Assessing Officer to believe that income chargeable to tax has escaped assessment. Further, the reasons also record that reopening of assessment is necessary to verify the above aspect. 3. The reasons as recorded do not indicate any link between the material obtained from the C.I.B. and the reasons to believe that income chargeable to tax has escaped assessment. In the absence of any indication of how the material obtained has led to the belief the income chargeable to tax has escaped assessment, the reasons prima facie, do not disclose any reason to believe that income chargeable to tax has escaped assessment. 4. In view of the above, all the three Notices dated 20th March, 2015 seeking to reopen the assessment for Assessment Years 2010-11, 2011-12 and 2012-13 are stayed till the final disposal of this petition. 4. An affidavit in reply has been filed in which it is stated But the actual extent of escapement of income can be established only after detailed investigation after providing opportunity of hearing to the petitioner . Therefore, admittedly this is a clear case of a fishing enquiry and even at the stage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings drawn upon which are abstracted earlier also show that Income tax Officer has applied his mind to the facts on record and was prime facie satisfied that the reopening of the assessment for the assessment year 1957 58 was needed due to those stated facts. The Hon ble Apex Court further held that : We reject the contention of Dr. Pal that the Income tax Officer has no reason to believe that income has escaped assessment for the relevant accounting year for the reasons mentioned by the Income tax Officer in the proceedings drawn on July 2, 1965. It is clear therefrom that the escapement of assessment was on account of omission or failure on the part of the Respondent to disclose the material fact truly and fully. xxxxxxxxxxxxxxx 22. Further, the Hon'ble Apex Court in the case of GKN Driveshafts (India) Ltd. V/s. Income Tax Officer 259 ITR 19 (SC) has held that the process to be followed in reopening cases is that once a notice under Section 148 of the Act is issued, the assessee must file the return of income and, thereafter, the reasons recorded by the Assessing Officer would be provided to the assessee. The assessee can file its objection and the Assessing Officer is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at we find is that there are no reasons to believe but, only reasons to suspect. Darpan P. Chandaliya (Supra) was relied upon in Paranjape Schemes (Construction) Ltd. V/s. Deputy Commissioner of Income Tax Circle 2(3)(1) Ors. Writ Petition No. 1415 of 2022 dated 10th November 2023 where paragraph 4 reads as under : 4. In Darpan Chandliya v. Income Tax Officer , a similar situation arose where also the AO had noted that he is seeking some information to examine the case of assessee. The Court held that, that cannot be stated to be founded on the belief that any income which is chargeable to tax has escaped assessment. Just because some information has been received does not entitle Respondent to reopen assessment. The reasons must be founded on the satisfaction of the AO that income chargeable to tax has escaped assessment. Once that is not to be found, then the impugned notice cannot be sustained. The Court said, what is found is that there are no reasons to believe but, only reasons to suspect. Hence, reopening of assessment is not satisfactory. Paragraph 8 of the said judgment reads as under: 8. Moreover, the AO has noted in the reason to believe that he is seeking some informati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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