9911796707
TMI Blog2024 (12) TMI 1479X X X X Extracts X X X X X X X X Extracts X X X X ..... urisdiction by the Assessing Officer for reopening of assessment u/s 147 r.w.s. 148 of the Act. For this assessee has raised ground nos. 1, 2, 2.1 and 2.2, which are argumentative and exhaustive and hence, need not be reproduced. 3. The brief facts are that the assessee is an individual and has filed his original return of income for AY 2013-14 on 05.08.2013. Subsequently the information was received by Assessing Officer through STR Report of the Deputy Director of Income Tax (Inv.) Unit-1, Ghaziabad that the assessee has maintained three bank accounts with bank of Maharashtra and there is huge cash deposit in these bank accounts.Subsequently this cash was transferred by RTGS and cash was withdrawn during the year under consideration. The Assessing Officer noticed that total credit entries in his bank account are to the tune of Rs. 26,91,95,139/- including cash deposit of Rs. 38 lakhs. The Assessing Officer noted that the assessee is engaged in the business of wholesale trading in raw meat, which is traditional family occupation in the area of District Hapur, Uttar Pradesh. The Assessing Officer, thereafter, recorded the reasons for reopening of assessment and then issued notice u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under section 271(1)(c) is separately initiated for inaccurate particulars of income." 3.1 Aggrieved assessee preferred appeal before CIT(A). 4. The CIT(A) also confirmed the action of the Assessing Officer exactly on identical all the facts. 4.1 Aggrieved assessee is in appeal before the Tribunal. 5. We have heard rival contentions and gone through the facts and circumstances of the case. We noted that the CIT(A) has confirmed the reopening u/s 147 of the Act by relying on the decision of the Hon'ble Supreme Court in the case of ACIT Vs. Rajesh Jhaveri Stock Brokers Pvt. Ltd. (2007) [291 ITR 500 (SC)]. Before us Ld. Counsel for the assessee took us through the order of the Assessing Officer and stated that reopening was made on the premise of credit entries of Rs. 26,91,95,139/- escaped assessment in the case of the assessee and hence reopening was done but the Assessing Officer disallowed 10% of purchases as an expenditure and thereby added a sum of Rs. 2,86,21,244/-. Ld. Counsel for the assessee drew our attention to reasons recorded which read as under: "As per record, the assessee having PAN: AIFPA8796G and return of income has been filed by the assessee on 28.03.2015 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment during the A.Y. 2013- 14 by reason of the failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment. Hence, it is a fit case for initiation of proceedings in terms of Explanation 2(b) of section 147 of the Income Tax Act, 1961, so as to bring to tax the income emanating of Rs. 26,91,95,139/- and any other income which comes to my notice subsequently during the course of assessment proceedings. Further, I have reason to believe that above discussed credit entries including cash deposit aggregating to Rs. 26,91,95,139/- is income of the assessee out of the undisclosed sources that is liable to be added in his income u/s 69 of I.T. Act, 1961 as unexplained investment, which has escaped assessment for A.Y. 2013-14 within the meaning of section 147 of Income Tax Act, 1961. Therefore, I have reason to believe that income of Rs. 26,91,95,139/- chargeable to tax has escaped assessment. Accordingly, necessary approval u/s 151(1) of Income Tax Act, 1961 is solicited to issue notice u/s 148 of the Income Tax Act, 1961 to re-open the assessment u/s 147 of Income Tax Act, 1961, so as to bring tax the income escaping assessment." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rao (supra). We may also note that the heading of section 147 is "income escaping assessment" and that of section 148 "issue of notice where income escaped assessment". Section 148 is supplementary and complimentary to section 147. Sub-section (2) of section 148 mandates reasons for issuance of notice by the Assessing Officer and sub-section (1) thereof mandates service of notice to the assessee before the Assessing Officer proceeds to assess, reassess or re-compute escaped income. Section 147 mandates recording of reasons to believe by the Assessing Officer that the income chargeable to tax has escaped assessment. All these conditions are required to be fulfilled to assess or reassess the escaped income chargeable to tax. As per Explanation (3) if during the course of these proceedings the Assessing Officer comes to conclusion that some items have escaped assessment, then notwithstanding that those items were not included in the reasons to believe as recorded for initiation of the proceedings and the notice, he would be competent to make assessment of those items. However, the legislature could not be presumed to have intended to give blanket powers to the Assessing Officer that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was framed on the disallowance of expenses of purchases at 10%. We noted that as per Explanation 3 of the section 147 of the Act, if during the course of assessment proceedings the Assessing Officer comes to conclusion that some items have escaped assessment, then notwithstanding that those items were not included in the reasons to believe as recorded for initiation of the proceedings, hence, the notice, he would be competent to make assessment to those items. The Hon'ble Delhi High Court has interpreted this that the legislature could not be presumed to have intended to give blanket powers to the Assessing Officer that on assuming jurisdiction u/s 147 of the Act regarding reassessment of escaped income, he would keep on making roving enquiry and thereby including different items of income not connected or related with the reasons to believe, on the basis of which he assumed jurisdiction. As in the present case, the issue is exactly identical what was before the Hon'ble Delhi High Court in Ranbaxy Laboratories Ltd. (supra) and of Jet Airways (I) Ltd. of Bombay High Court (supra). Since the issue, is in favour of the assessee, we quash the reassessment framed by Assessing Officer a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
