Harneet Singh Madan, Ludhiana V. ITO, W-6(1), Ludhiana

ITA 1005/CHANDI/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0895 (ITAT-CHANDIGARH)
• Duration Of Justice: 10 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 10-07-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ARVIND SUDARSHAN JCIT
• Keywords: Additional evidence; Difference of opinion; Assessment record; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 143(3); 142(1); 143(1); 69A; 191; 147; 68; 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH A, CHANDIGARH , !' # $ % &', '( BEFORE: SH. SANJAY GARG, JM & SMT. ANNAPURNA GUPTA, AM ITA NO. 1005/CHD/2019 ASSESSMENT YEAR : 2011-12 SHRI HARMEET SINGH MADAN H.NO. 53-I, BRS NAGAR, LUDHIANA THE ITO WARD-6(1), AAYKAR BHAWAN RISHI NAGAR, LUDHIANA PAN NO: ARPPS2409D APPELLANT RESPONDENT !' ASSESSEE BY : NONE #!' REVENUE BY : SHRI ARVIND SUDARSHAN, JCIT $ %! & DATE OF HEARING : 05/03/2020 '()*! & DATE OF PRONOUNCEMENT : 29/05/2020 ')/ ORDER PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINS T THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX(APPEALS) -3, LUDHIANA (IN SHORT CIT(A)) DT. 13/05/2019 ,PASSED U/S 250(6) OF THE INCOME TAX ACT,1961 (HEREINA FTER REFERRED TO AS ACT) 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL: 1. THE LD. CIT(A)IS NOT JUSTIFIED IN CONFIRMING AN ADD ITION OF RS.23,58,415/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK. 2. THE LD. CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE A CTION OF THE A.O. OF INITIATING PROCEEDINGS UNDER SECTION 147 ONLY ON THE BASIS OF INFORMATION THAT THE APPELLANT HAS MADE A CASH DEPOSITS IN THE BANK. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFIC ER(AO) WAS IN POSSESSION OF INFORMATION THAT THE ASSESSEE HAD DEPOSITED CASH OF RS . 23,58,415/- IN HIS SAVING BANK ACCOUNT MAINTAINED WITH ICICI BANK LTD., AND EARNED INTERES T AMOUNTING TO RS. 712/-, BUT NOT FILED HIS RETURN OF IN COME. THE ASSESSING OFFICER REOPENED THE CASE AND ISSUED NOTICE UNDER SECTION 148 OF THE ACT ON 30.03.2018, 2 THROUGH REGISTERED MAIL AS WELL AS THROUGH SPEED POST . BUT THE ASSESSEE COMPLETELY FAILED TO FILE ANY REPLY IN COMPLIANCE TO THE NOTICE U/ S 148 OF THE ACT. FURTHER, EXPLANATIONS WERE CALLED FROM THE ASSESSEE BY THE AO W ITH REGARD TO CASH DEPOSITED OF RS. 23,58,415/-. BUT THE ASSESSEE FAILED TO FILE ANY REPLY IN RESPECT OF THE SAME.THE AO THEREFORE TREATED THE CASH DEPOSITED OF RS. 23,59,13 0/- AS UNEXPLAINED INCOME OF THE ASSESSEE U/S 69A OF THE ACT, AND MADE ADDITION OF T HE SAME TO THE RETURNED INCOME OF THE ASSESSEE. 4. THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A) CHA LLENGING BOTH THE INITIATION OF PROCEEDINGS UNDER SECTION 147 OF THE ACT AND ALSO MER ITS OF THE ADDITION MADE. THE LD. CIT(A), AFTER CONSIDERING THE MATERIAL AVAILABLE ON T HE RECORD AND ALSO THE SUBMISSIONS MADE BY THE ASSESSEE, FOUND NO MERIT IN THE APPEAL FILED BY THE ASSESSEE DISMISSING ALL THE GROUNDS RAISED. 5. AGGRIEVED BY THE SAME THE ASSESSEE HAS COME IN APPEA L BEFORE US. 6. IN GROUND NO. 2 RAISED BEFORE US, THE ASSESSEE HAS C HALLENGED THE VALIDITY OF THE ORDER PASSED U/S 148 OF THE ACT FOR THE REASON THAT THE INITIATION OF PROCEEDINGS U/S 147 OF THE ACT COULD NOT HAVE BEEN DONE ON THE MERE INFORMATION OF CASH DEPOSITED IN BANK .THE ARGUMENT OF THE LD.COUNSEL FOR THE ASSESSEE IN T HS REGARD IS THAT MERE INFORMATION OF CASH DEPOSIT IN BANK WAS NOT SUFFICIENT TO FORM BELIEF OF ESCAPMENT OF INCOME BY THE AO ,WHICH WAS A NECESSARY PREREQUISITE FOR REOPENING THE CASE U/S 147 OF THE ACT. 7. THE LD.CIT(A) HAS DEALT WITH THIS ISSUE AT PARA 5 - 5.4 OF THE ORDER AS UNDER: 5. I HAVE CAREFULLY CONSIDERED RIVAL SUBMISSION. I HAVE ALSO GONE THROUGH THE ASSESSMENT RECORD. THE BASIC FACT-OF THIS CASE IS THAT, THE AS SESSEE HAS NOT FILED HIS INCOME TAX RETURN ,FOR THE RELEVANT YEAR. DURING THE YEAR, THE ASSESS ING OFFICER RECEIVED AN INFORMATION, THAT THE ASSESSEE HAD MADE CASH DEPOSITS TOTALING TO RS 23,58,415/-IN HIS BANK ACCOUNT MAINTAINED WITH ICICI BANK LTD, AND EARNED INTEREST INCOME THEREON AT RS 712/-. BASED ON THIS INFORMATION THE ASSESSING OFFICER ISSUED BASIC ENQUIRY LETTER DATED 19/01/2018, TO THE ASSESSEE ON THE ADDRESS 53-I, B.R.S. NAGAR , LUDHIA NA, FOR EXPLAINING THE INFORMATION ON FINANCIAL TRANSACTION PERTAINING TO ASSESSEE. HOWEV ER THE ASSESSEE DID NOT FILE ANY INFORMATION. THEREAFTER VIDE LETTER DATED 19/02/201 8, THE ASSESSING OFFICER AGAIN ISSUED NOTICE UNDER SECTION 133 (6) TO THE ASSESSEE .CALLI NG FOR INFORMATION ASKING DETAIL OF DEPOSITS IN BANK ACCOUNT .ALONG WITH OTHER INFORMAT ION ON THE ADDRESS APPEARING AS PER INFORMATION. THIS LETTER WAS SENT TO THE ADDRESS AP PEARING AS PER BANK ACCOUNT. AS PER ASSESSEE.S ADDRESS APPEARING IN RECORDS OF ICICI BA NK ACCOUNT, SHOWING AS HOUSE NO- 2187 , LLND FLOOR , RANJIT TOWER, PAKHOWAL ROAD , L UDHIANA. HOWEVER THIS NOTICE ALSO, COULD 3 NOT BE SERVED DESPITE BEING THE CORRECT AND COMPLET E ADDRESS. THEREAFTER THE ASSESSING OFFICER INITIATED REOPENING PROCEEDINGS UNDER SECTI ON 148, AFTER TAKING DUE APPROVAL OF PCIT- 3 , LUDHIANA ON 30.03.2018. THEREAFTER THE AS SESSING OFFICER ISSUED TIME TO TIME NOTICES U/S 142(1) WHICH REMAINED UNCOMPLIED WITH, TILL THE COMPLETION OF ASSESSMENT PROCEEDINGS. THE ASSESSING OFFICER HAS MENTIONED TH IS FACT ON THE FIRST PAGE OF ASSESSMENT ORDER. THE LD. A.O. COMPLETED THE ASSESSMENT EX PAR TE UNDER SECTION 144, TREATING THE SOURCE OF CASH DEPOSITS OF RS 23,58,415/- AS UNEXPL AINED AND ALSO ASSESSED TO TAX THE INTEREST INCOME OF RS 712/-, THUS COMPLETING THE AS SESSMENT AT A TOTAL INCOME OF RS 23,59,127/-. 5.1 NOW THE ASSESSEE HAS COME IN APPEAL CHALLENGING THIS ADDITION OF RS. 23,58,415/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN BANK U/S 68 BY TAKING 3 GROUNDS OF APPEAL. THE ASSESSEE HAS CHALLENGED THE ADDITION, ON THE GROUND , THAT THE INITIATION OF 148 PROCEEDING WAS NOT PROPER AS IT WAS BASED ,ONLY ON THE INFORMA TION THAT THE APPELLANT HAS MADE CASH DEPOSITS IN THE BANK . SECONDLY THE ASSESSEE HAS FU RTHER CHALLENGED THE DISALLOWANCE STATING LACK OF OPPORTUNITY GIVEN TO THE ASSESSEE. IN ORDER TO VERIFY ASSESSES CLAIM , I HAVE CAREFULLY GONE THROUGH THE ASSESSMENT ORDER AND THE ASSESSEE'S WRITTEN SUBMISSION FILED. DURING APPELLATE PROCEEDINGS. I HAVE ALSO CAREFULLY GONE THROUGH THE ASSESSMENT RECORD OF APPELLANT FOR THE RELEVANT YEAR. AFTER THE PERUSAL OF ASSESSMENT RECORD, I FIND MYSELF IN COMPLETE AGREEMENT WITH THE VIEW TAKEN BY THE OFFIC ER, IN THE LIGHT OF THE FACTS AS EMERGED FROM THE PERUSAL OF ASSESSMENT RECORD. THIS APPEAL IS MAINLY BASED ON THE'ASSESSEE'S PLEA, THAT THE ASSESSMENT HAS WRONGL Y BEEN MADE BY INITIATING REOPENING U/S 148 , BASED MEARLY UPON AN INFORMATION OF CASH DEPOSIT BY ASSESSEE IN THE BANK ACCOUNT. THE SECOND PLEA OF THE ASSESSEE IS THAT, T HE ASSESSEE WAS NOT GIVEN DUE OPPORTUNITY DURING ASSESSMENT PROCEEDINGS. THE ASSE SSEE HAS VEHEMENTLY CONTENDED IN HIS WRITTEN SUBMISSION ,THAT THE ASSESSEE WAS NEVER IN RECEIPT OF ANY OF THE NOTICES INCLUDING THE FIRST NOTICE UNDER SECTION148 DATED 28/03/2018. ACCORDING TO ASSESSEE THE ASSESSEE NEVER RECEIVED ANY OF THE NOTICES UNDER SECTION 142 (1) IN SUBSEQUENT ASSESSMENT PROCEEDING. THE ASSESSEE HAS CONTENDED IN HIS WRITT EN SUBMISSION THAT THE ASSESSEE WAS NOT CONFRONTED WITH THE INFORMATION ON THE BASIS OF WHICH PROCEEDINGS UNDER SECTION 147 WERE INITIATED. THE APPELLANT HAS ALSO VEHEMENTLY C ONTENDED THAT, WITHOUT OBTAINING THE EXPLANATION OF THE ASSESSEE ABOUT THE SOURCE OF THE BANK DEPOSITS, THE LD A.O HAS FORMED REASON TO BELIEVE THAT INCOME OF THE ASSESSEE, CHAR GEABLE TO TAX, AMOUNTING TO RS. 23,52,127/- HAS ESCAPED ASSESSMENT. 5.2 IN THIS CONNECTION WHILE GOING THROUGH THE ASSE SSMENT RECORD OF APPELLANT, THIS FACT HAS EMERGED THAT THE APPELLANT HAS DELIBERATEL Y AVOIDED TO RECEIVE THE NOTICES ISSUED BY THE ID . A. O. . IT IS NOTICED THAT THE A DDRESS OF APPELLANT IS CORRECT ON ALL THE NOTICES SENT TO APPELLANT, HOWEVER IT IS SURPRISING TO NOTE THAT , UNDER WHICH CIRCUMSTANCES THE NOTICES COULD REMAIN UN SERVED UPON THE ASSESSE E. IT IS SEEN THAT AS PER INFORMATION RECEIVED BY ASSESSING OFFICER, REGARDING NON FILING OF INCOME TAX RETURN, BY THE APPELLANT, THE AO., ITO WARD 6(5 CALLED FOR DETAILS AND EXPL ANATION OF CASH DEPOSIT OF RS 10 LAKH IN SAVING BANK ACCOUNT, IN LETTER DATED 19/01/2018 , W HEREIN THE ADDRESS OF THE ASSESSEE HAS BEEN MENTIONED IS , 53-I, BRS NA GAR. HOWEVER SURPRISINGLY THE ASSESSEE DID NOT COMP LY WITH THIS NOTICE ALSO , WHICH WAS MUCH BEFORE THE INITIA TION OF REOPENING PROCEEDINGS UNDER SECTION148. THEREAFTER IT WAS FOUND THAT IN BANK RE CORDS THE ADDRESS OF APPELLANT HAS APPEARED AS H.N. 2187 ,2 ND FLOOR, RANJIT TOWER, PAKHOWAL ROAD , LUDHIANA .HOW EVER STILL WHEN THE NOTICES WERE SENT HERE BY A.O. , AGAIN IT CAME BACK UN SERVED WITH THE REMARK 'ADDRESS INCOMPLETE', ALTHOUGH THE ADDRESS IS CORR ECT AS APPARENT FROM THE LETTER DATED 19/12/2018 SENT BY BANK, TO AO . , IN RESPONSE TO H IS NOTICE U/S 133(6), WHEREIN, THE A.O. ASKED FOR KYC DOCUMENTS OF ASSESSEE FROM BANK . IN THE LETTER SENT BY BANK, BOTH OF THE ADDRESS AS MENTIONED ABOVE OF LUDHIANA, WERE INTIMA TED TO THE AO. 5.3 DURING THE ASSESSMENT PROCEEDINGS WHEN THE NOTI CES COULD NOT BE SERVED, UPON ANY OF THE ADDRESSES OF ASSESSEE , THEN THE AO USED THE ADDRESS OF THE APPELLANT, AS PER LATEST ADDRESS OF HIS ITR FILED FOR A.Y. 2018-2019 , SHOWING THE ADDRESS OF AASSEESSEE AT H.NO. 140, BASTI SHEIKH, NEAR POST OFFICE, JALANDHAR. DUR ING THE APPELLATE PROCEEDINGS THE 4 APPELLANT HAS VEHEMENTLY CONTESTED THE VALIDITY OF NOTICES OF DEPARTMENT .WHICH REMAINED UNSERVED, AND STRESSED THAT THE NOTICE.S W ERE SENT AT THE OLD ADDRESS OF THE ASSESSEE AT H.NO. 140, BASTI SHEIKH, NEAR POST OFFI CE, JALANDHAR, WHEREAS THE ASSESSEE IS PRESENTLY RESIDING AT H.NO. 53-I, B.R.S NAGAR, LUDH IANA. SECONDLY THE ASSESSEE HAS CHALLENGED THE ADDITION O N THE GROUND , THAT LD. AO IS NOT JUSTIFIED IN INITIATING PROCEEDINGS UNDER SECTION 1 47 ,ONLY ON THE BASIS OF INFORMATION THAT THE APPELLANT HAS MADE A CASH DEPOSITS IN THE BANK. AS DISCUSSED IN ABOVE PARAGRAPHS IT IS APPARENT THAT THE AO AFTER HAVING CREDIBLE INFORMAT ION IN THE CASE OF APPELLANT HAS INITIATED REOPENING ASSESSMENT U/S 148 , AFTER INIT IATING OUT DUE INQUIRIES, AND GIVING OPPORTUNITIES TO THE APPELLANT. HOWEVER AS APPARENT FROM THE RECORDS , THE ASSESSEE HAS DELIBERATELY AVOIDED TO RECEIVE THE NOTICES , DESPI TE CORRECTNESS OF THE ADDRESS. HENCE CONSIDERING THE FACTS AS EMERGED FROM THE PERUSAL O F ASSESSMENT RECORD AND WRITTEN SUBMISSION OF APPELLANT, I DO NOT SEE ANY LACUNA IN INITIATION OF REOPENING PROCEEDING U/S 148. RELIENCE IS PLACED ON THESE JUDICIAL PRONOUNCE MENTS : ACIT VS RAIESH JHAVERISTOCK BROKERS P. LIMITED .291 ITR 500 SC AT THE TIME OF INITIATION OF RE-ASSESSMENT PROCEEDI NGS ONLY REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT IS SUFFICIENT TO INVOKE JURISDICTION OF AO TO INITIATE RE-ASSESSMENT PROCEEDINGS. 'SECTION 147 AUTHORISES AND PERMITS THE ASSESSING OFFICER TO ASSESS OR REASSESS INCOME CHARGEABLE TO TAX IF HE HAS REASON TO BELIEVE THAT INCOME FOR ANY ASSESSMENT YEAR HAS ESCAPED ASSESSMENT. THE WORD 'REASON' IN THE PHRASE 'REASON TO BELIEVE' WOULD MEAN CAUSE OR JUSTIFICATION. IF THE ASSESSING OFFICER HA S CAUSE OR JUSTIFICATION TO KNOW OR SUPPOSE THAT INCOME HAD ESCAPED ASSESSMENT, IT CAN BE SAID TO HAVE REASON TO BELIEVE THAT AN INCOME HAD ESCAPED ASSESSMENT. THE EXPRESSION CANNO T BE READ TO MEAN THAT THE ASSESSING OFFICER SHOULD HAVE FINALLY ASCERTAINED T HE FACT BY LEGAL EVIDENCE OR CONCLUSION. THE FUNCTION OF THE ASSESSING OFFICER IS TO ADMINIS TER THE STATUTE WITH SOLICITUDE FOR THE PUBLIC EXCHEQUER WITH AN INBUILT IDEA OF FAIRNESS T O TAXPAYERS. AS OBSERVED BY THE SUPREME COURT IN CENTRAL PROVINCES MANGANESE ORE CO. LTD. V . ITO [1991] 191 ITR 662, FOR INITIATION OF ACTION UNDER SECTION 147(A) (AS THE PROVISION STOO D AT THE RELEVANT TIME) FULFILMENT OF THE TWO REQUISITE CONDITIONS IN THAT REGARD IS ESSENTIA L. AT THAT STAGE, THE FINAL OUTCOME OF THE PROCEEDING IS NOT RELEVANT. IN OTHER WORDS, AT THE INITIATION STAGE, WHAT IS REQUIRED IS 'REASON TO BELIEVE', BUT NOT THE ESTABLISHED FACT OF ESCAPE MENT OF INCOME+AT THE STAGE OF ISSUE OF NOTICE, THE ONLY QUESTION IS WHETHER THERE WAS RELE VANT MATERIAL ON WHICH A REASONABLE PERSON COULD HAVE FORMED A REQUISITE BELIEF. WHETHE R THE MATERIALS WOULD CONCLUSIVELY PROVE THE ESCAPEMENT IS NOT THE CONCERN AT THAT STA GE. THIS IS SO BECAUSE THE FORMATION OF BELIEF BY THE ASSESSING OFFICER IS WITHIN THE REALM OF SUBJECTIVE SATISFACTION (SEE ITO V. SELECTED DALURBAND COAL CO. P. LTD. [1996] 217 ITR 597 (SC) ; RAYMOND WOOLLEN MILLS LTD. V. ITO [1999] 236 ITR 34 (SC). THE SCOPE AND EFFECT OF SECTION 147 AS SUBSTITUTED WITH EFFECT FROM APRIL 1, 1989, AS ALSO SECTIONS 148 TO 152 ARE SUBSTANTIALLY DIFFERENT FRO M THE PROVISIONS AS THEY STOOD PRIOR TO SUCH SUBSTITUTION. UNDER THE OLD PROVISIONS OF SECTION 1 47, SEPARATE CLAUSES (A) AND (B) LAID DOWN THE CIRCUMSTANCES UNDER WHICH INCOME ESCAPING ASSES SMENT FOR THE PAST ASSESSMENT YEARS COULD BE ASSESSED OR REASSESSED. TO CONFER JU RISDICTION UNDER SECTION 147(A) TWO CONDITIONS WERE REQUIRED TO BE SATISFIED: FIRSTLY T HE ASSESSING OFFICER MUST HAVE REASON TO BELIEVE THAT INCOME, PROFITS OR GAINS CHARGEABLE TO INCOME TAX HAVE ESCAPED ASSESSMENT, AND SECONDLY HE MUST ALSO HAVE REASON TO BELIEVE TH AT SUCH ESCAPEMENT HAS OCCURRED BY REASON OF EITHER OMISSION OR FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY OR TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT OF THAT YEAR. BOTH THESE CONDITIONS WERE CONDITIONS PRECEDENT TO BE SATISFIED BEJBRE THE ASS ESSING OFFICER COULD HAVE JURISDICTION TO ISSUE NOTICE UNDER SECTION 148 READ WITH SECTION 14 7(A). BUT UNDER THE SUBSTITUTED SECTION 147 EXISTENCE OF ONLY THE FIRST CONDITION SUFFICES. IN OTHER WORDS IF THE ASSESSING OFFICER FOR WHATEVER REASON HAS REASON TO BELIEVE THAT INCOME H AS ESCAPED ASSESSMENT IT CONFERS JURISDICTION TO REOPEN THE ASSESSMENT. IT IS, HOWEV ER, TO BE NOTED THAT BOTH THE CONDITIONS MUST BE FULFILLED IF THE CASE FALLS WITHIN THE AMBI T OF THE PROVISO TO SECTION 147. THE CASE AT HAND IS COVERED BY THE MAIN PROVISION AND NOT THE P ROVISO. 5 SO LONG AS THE INGREDIENTS OF SECTION 147 ARE FULFI LLED, THE ASSESSING OFFICER IS FREE TO INITIATE PROCEEDING UNDER SECTION 147 AND FAILURE TO TAKE ST EPS UNDER SECTION 143(3) WILL NOT RENDER THE ASSESSING OFFICER POWERLESS TO INITIATE REASSES SMENT PROCEEDINGS EVEN WHEN INTIMATION UNDER SECTION 143(1) HAD BEEN ISSUED. ' A.L.A. FIRM V. CIT119911 189 ITR 285 (SC) THE JURISDICTION OF THE INCOME-TAX OFFICER TO REASS ESS INCOME ARISES IF HE HAS, IN CONSEQUENCE OF SPECIFIC AND RELEVANT INFORMATION CO MING, INTO HIS POSSESSION SUBSEQUENT TO THE PREVIOUS CONCLUDED ASSESSMENT, REASON TO BEL IEVE THAT INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT. IT WAS HELD THAT EVEN IF TH E INFORMATION BE SUCH THAT IT COULD HAVE BEEN OBTAINED BY THE INCOME-TAX OFFICER DURING THE PREVIOUS ASSESSMENT PROCEEDINGS BY CONDUCTING AN INVESTIGATION OR AN EN QUIRY BUT WAS NOT IN FACT SO OBTAINED, IT WOULD NOT AFFECT THE JURISDICTION OF THE INCOME- TAX OFFICER TO INITIATE REASSESSMENT PROCEEDINGS, IF THE TWIN CONDITIONS PRESCRIBED UNDE R SECTION 147 OF THE ACT ARE SATISFIED. RAYMOND WOOLLEN MILLS LIMITED. VS M) 236ITR 34 SC IN THIS CASE, WE DO NOT HAVE TO GIVE A FINAL DECISI ON AS TO WHETHER THERE IS SUPPRESSION OF MATERIAL FACTS BY THE ASSESSEE OR NOT. WE HAVE ONLY TO SEE WHETHER THERE WAS PRIMA FACIE SOME MATERIAL ON THE BASIS OF WHICH THE DEPARTMENT COULD REOPEN THE CASE. THE SUFFICIENCY OR CORRECTNESS OF THE MATERIAL IS NOT A THING TO BE CONSIDERED AT THIS STAGE. WE ARE OF THE VIEW THAT THE COURT CANNOT STRIKE DOWN T HE REOPENING OF THE CASE IN THE FACTS OF THIS CASE. IT WILL BE OPEN TO THE ASSESSEE TO PROVE THAT THE ASSUMPTION OFFACTS MADE IN THE NOTICE WAS ERRONEOUS. THE ASSESSEE MAY ALSO PROVE T HAT NO NEW FACTS CAME TO THE KNOWLEDGE OF THE INCOME-TAX OFFICER AFTER COMPLETIO N OF THE ASSESSMENT PROCEEDING. WE ARE NOT EXPRESSING ANY OPINION ON THE MERITS OF THE CASE. THE QUESTIONS OFFACT AND LAW ARE LEFT OPEN TO BE INVESTIGATED AND DECIDED BY THE ASS ESSING AUTHORITY. THE APPELLANT WILL BE ENTITLED TO TAKE ALL THE POINTS BEFORE THE ASSESSIN G AUTHORITY. THE APPEALS ARE DISMISSED. PHOOL CHAND BAIRANG LAI AND ANOTHER. PHOOL CHAND BA JRANS LAI AND ANOTHER. VS ITO 203 ITR 456 SC FAILURE TO DISCLOSE FULLY AND TRULY MATERIAL FACTS. CASH LOAN CLAIMED TO BE TAKEN BY ASSESSEE FROM COMPANY. ACCEPTED AS GENUINE AND ORIGINAL ASSE SSMENTS MADE ALLOWING INTEREST THEREON AS DEDUCTION. SUBSEQUENT INFORMATION FROM O FFICER ASSESSING COMPANY THAT ITS MANAGING DIRECTOR HAD CONFESSED THAT COMPANY HAD NO T ADVANCED ANY LOAN TO ANY PERSON DURING PERIOD COVERING DATE OF CASH LOAN BEL IEF OF ITO THAT INCOME %AD ESCAPED ASSESSMENT NOTICE FOR REASSESSMENT NOT MERE CHANGE OF OPINION SUFFICIENCY OF REASONS FOR FORMING THE BELIEF IS NOT FOR THE COURT TO JUDGE SU BSEQUENT INFORMATION DEFINITE, SPECIFIC AND RELIABLE NOTICE FOR REASSESSMENT VALID. GURERA GAS CYLINDERS PVT LTD. VS CIT258 ITR 170 P&H A PERUSAL OF THE REASONS RECORDED BY RESPONDENT NO. 2 SHOWS THAT HE HAD APPLIED HIS MIND TO THE RELEVANT MATERIAL AND FORMED A BELIEF T HAT THE PETITIONER HAD NOT DISCLOSED COMPLETE FACTS WHICH COULD ENABLE IT TO CLAIM DEDUC TION UNDER SECTION 80-1 AND, THEREFORE, ITS INCOME HAD NOT BEEN PROPERLY ASSESSE D. AT THIS STAGE, THE COURT CAN NEITHER GO INTO THE SUFFICIENCY OR ADEQUACY OF THE REASONS RECORDED BY RESPONDENT NO. 2 NOR CAN IT INTERFERE WITH THE NOTICE SIMPLY BECAUSE ON AN O VERALL REAPPRAISAL OF MATERIAL, A DIFFERENT OPINION MAY BE FORMED. 5.4 IN MY CONSIDERED VIEW THE AO HAS MADE BEST POSS IBLE EFFORTS , TO GIVE DUE OPPORTUNITIES TO THE ASSEESSEE, AT THE TIME OF ASSE SSMENT PROCEEDINGS BEFORE CLOSING THE ASSESSMENT PROCEEDINGS, WHICH IS EVIDENT FROM THE A SSESSMENT RECORDS TOO. ACCORDINGLY THE ADDITIONS , MADE BY ID. AO ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS HAS RIGHTLY BEEN MADE . THE ASSESSEE NOW CANNOT TAKE THIS PLEA THAT THE ASSESSEE WAS NOT CONFRONTED WITH THE INFORMATION ON BASIS OF WHICH PROCEEDINGS UNDER SECTION 147 WERE INITIATED. AS EVIDENT FROM THE DISCUSSION , AND THE FACTS AS EMERGED FROM THE PERUSAL OF ASSESSMENT ORDER WHICH WERE FURTHER STRENGTHENED FROM THE FACTS , EMERGED FROM THE ASSESSMENT RECORD. UNDOUBTEDLY THE NOTICES WERE SENT ON CORRECT ADDRES S TO THE APPELLANT, BUT DELIBERATELY 6 THE APPELLANT HAS NOT RECEIVED ANY OF THE NOTICES A ND AFTER RECEIVING THE NOTICES INITIALLY HAS NOT RESPONDED TO THE ASSESSING OFFICER. THEREFO RE, IN MY CONSIDERED VIEW , THE ASSESSING OFFICER HAS RIGHTLY , INITIATED REOPENING PROCEEDIN GS UNDER SECTION148 AND SUBSEQUENTLY SENT NOTICES UNDER SECTION 142(1) FROM TIME TO TIME GIVING SEVERAL OPPORTUNITIES. THEREAFTER AFTER GIVING DUE OPPORTUNITIES TO THE ASSESSEE , , DUE TO ABSENCE OF ANY EXPLANATION ON THE PART OF ASSESSEE .EXPLAINING THE CASH DEPOSIT AMOUN TING TO RS. 23,58,450/- AFTER ADDING INTEREST OF RS. 712/- ADDITION OF RS. 23,59,127/- T REATING IT AS THE UNEXPLAINED INCOME OF THE ASSESSING UNEXPLAINED SOURCES U/S 69A. 8. WE HAVE GONE THROUGH THE FINDINGS OF THE LD. CIT(A) . WE DO NOT FIND ANY INFIRMITY IN THE SAME. AS NOTED BY THE LD.CIT(A), THE AO, BESIDES HAVING INFORMATION OF CASH DEPOSIT IN BANK, WAS ALSO IN THE KNOW THAT NO RETURN O F INCOME HAD BEEN FILED BY THE ASSESSEE FOR THE IMPUGNED YEAR AND ON INQUIRIES MAD E BY HIM REGARDING THE CASH DEPOSITED IN BANK, NO INFORMATION WAS FORTHCOMING FROM T HE ASSESSEE .THE LD. CIT(A) HAS NOTED THAT THE ASSESSEE DELIBERATELY AVOIDED TO REC EIVE NOTICES,DESPITE THE SAME BEING SENT AT CORRECT ADDRESSES. THE LD.COUNSEL FOR THE ASSESSEE HAS BEEN UNABLE TO CONTROVERT THE AFORESTATED FACTS. THERE WAS CLEARLY THE REFORE NO EXPLANATION REGARDING THE CASH DEPOSITS, DESPITE SUFFICIENT OPPORTUNITY GIVEN TO THE ASSESSEE. THE A.O. THEREFORE, WE AGREE WITH THE LD.CIT(A), HAD CREDIBLE INF ORMATION FOR BELIEVING THAT INCOME HAD ESCAPED ASSESSMENT AND HAD RIGHTFULLY INITIAT ED PROCEEDINGS FOR REOPENING THE CASE OF THE ASSESSEE U/S 147 OF THE ACT. 9. THE ORDER OF THE LD.CIT(A) UPHOLDING THE VALIDITY O F THE ORDER PASSED U/S 147 OF THE ACT IS UPHELD . 10. GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS D ISMISSED. 11. IN GROUND NO. 1 THE ASSESSEE HAS CHALLENGED THE MERIT S OF THE ADDITION MADE .THE FINDINGS OF THE LD. CIT(A) AT PARA 5.5 OF THE ORDER ARE AS UNDER: 5.5 THE APPELLANT HAS ALSO FURNISHED EXPLANATION ON MERIT ALSO, STATING THAT THE CASH DEPOSITS APPEARING IN THE BANK ACCOUNT REFELTS THAT THE ASSESSEE WAS DOING THE BUSINESS OF TRAVEL AGENT ON SMALL SCALE BASIS JOINTLY WITH HIS FRIEND SH. MANDEEP SINGH. THE BANK ACCOUNT WAS ALSO IN THE JOINT NAMES OF BOTH THE PER SONS. THE LD. A.O. WITHOUT MAKING ANY ENQUIRY ON THIS POINT, ASSESSED THE TOTAL INCOME IN THE NAME OF ONE PERSON ONLY. HOWEVER IN ABSENCE OF ANY DETAILED SUBMISSION BY ASSESSEE A T THE TIME OF ASSESSMENT PROCEEDINGS, AND IN ABSENCE OF ANY REQUEST BY APPELLANT TO ADMIT ADDITIONAL EVIDENCE U/R 46A, THIS PLEA OF APPELLANT CANNOT BE CONSIDERED AT THIS STAG E. 12. AS IS EVIDENT FROM THE ABOVE THE ASSESSEE HAD EXP LAINED THE CASH DEPOSITS AS BEING RELATED TO HIS BUSINESS OF TRAVEL AGENT WHICH PU RPORTEDLY HE WAS CARRYING OUT WITH 7 A FRIEND. THE ASSESSEE HAD ALSO CLAIMED THAT THE BANK AC COUNT WAS IN THE JOINT NAME, BUT THE LD. CIT(A) WE FIND, HAS NOTED THAT THIS EXPLANAT ION WAS NOT SUBSTANTIATED WITH ANY EVIDENCE FILED BEFORE HIM.EVEN BEFORE US NO EVIDEN CE HAS BEEN FILED TO SUBSTANTIATE THE EXPLANATION OF THE ASSESSEE. 13. IN VIEW OF THE ABOVE WE SO NO REASON TO INTERFERE IN THE ORDER OF THE LD. CIT(A) DISMISSING THE GROUND RAISED BY THE ASSESSEE REGARDING THE MERIT OF THE ADDITION. 14. GROUND NO. 1 RAISED BY THE ASSESSEE IS DISMISSED. 15. IN THE RESULT APPEAL OF THE ASSESSEE IS DISMISSED. (ORDER PRONOUNCED ON 29/05/2020) SD/- SD/- # $ % &', (SANJAY GARG ) ( ANNAPURNA GUPT A) / JUDICIAL MEMBER '( / ACCOUNTANT MEMBER AG DATE: 29/05/2020 (+! ,-.- COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. $ / CIT 4. $ / 01 THE CIT(A) 5. -2 45&456789 DR, ITAT, CHANDIGARH 6. 8:% GUARD FILE