Rajesh Aggarwal, New Delhi V. ACIT, New Delhi

ITA 1586/DEL/2010

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97023 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 01-05-2015
• Assessment Year: 2000-2001
• Appeal Filed On: 09-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: K C SINGHAL
• Keywords: Question of law; Wrong claim; Reassessment proceedings
• Section: 142(1); 80HHC; 234B; 147; 148; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : F : NEW DELHI BEFORE SHRI G.C. GUPTA , VICE PRESIDENT AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA NO S . 1586 & 151 /DEL/201 0 ASSESSMENT YEAR S : 2000 - 01 & 2001 - 02 RAJESH AGGARWAL, VS. ASSTT. COMMISSIONER OF INCOME C - 17, SATYAWATI COLONY, TAX, CIRCLE - 19(1), VIKAS BHAWAN, ASHOK VIHAR, PHASE - III, NEW DELHI NEW DELHI (PAN: ACWPA0153C ) (APPELLANT) (RESPONDENT) APPELLANT BY : SH. K.C. SINGHAL, ADV. RESPONDENT BY: SH. VIKRAM SAHAY, SR.DR DATE OF HEARING: 03.07.2015 DATE OF PRONOUNCEMENT: 19.08.2015 ORDER PER INTURI RAMA RAO, A.M. : THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDERS DATED 18.01.2010 AND 03.11.2009 PASSED BY LD. CIT(A) FOR THE ASSESSMENT YEARS 2000 - 01 AND 2001 - 02 RESPECTIVELY. SINCE COMMON GROUNDS OF APPEAL WERE RAISED IN BOTH THE APPEALS, WE PROCEED TO DECIDE THE SAME BY A CONSOLIDATED ORDER. GROUNDS OF APPEAL RAISED IN ITA NO. 1586/DEL/2010 ARE REPRODUCED AS UNDER: 1. THAT THE REASSESSMENT PROCEEDINGS U/S 147 ARE BAD IN LAW SINCE NOT INITIATED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 147 TO 151 OF T HE I. T. ACT 1961. 2. THAT THE IMPUGNED DISALLOWANCE U/S 80 HHC OF I. T. ACT 1961 IS ILLEGAL ON THE IT AND IS LIABLE TO THE DELETED FOR THE FOLLOWING REASONS: - (I) THE INFORMATION'S AND THE MATERIALS RECEIVED BY THE A.O FROM THE INVESTIGATION WING, NEW DELHI OR FROM ANY OTHER SOURCE WERE NEVER 2 SUPPLIED TO THE ASSESSES. CONSEQUENTLY, THE SAID INFORMATION'S AND MATERIALS, NOT AMOUNTING TO EVIDENCE, COULD NOT USED AGAINST THE ASSESSES: (II) IT IS BASED ON MERE SURMISES, CONJECTURES AND ALLEGATIONS NOT SUP PORTED BY ANY EVIDENCE; (III) EVEN NO FINDING OF THE CUSTOM AUTHORITIES WAS AVAILABLE WHICH IS EVIDENT FROM THE ASSESSMENT ORDER ITSELF; (IV) NO INDEPENDENT ENQUIRY WAS MADE THE BY A.O. INTO THE ALLEGATIONS MADE AGAINST THE ASSESSES IN THE INFORMATION RECEIVED: (V) ON THE CONTRARY, THE DOCUMENTARY EVIDENCES REGARDING ACTUAL EXPORT AND FOREIGN CURRENCY RECEIVED WERE NOT EXAMINED BY THE A.O. EVEN THOUGH FURNISHED BEFORE HIM IN THE ASSESSMENT PROCEEDING. THIS IT SELF SHOWS THAT ASSESSMENT WAS FRAMED IN A N ARBITRARY MANNER, (VI) THE ALLEGATIONS MADE THE GROUND OF APPEAL IF REQUIRED AND NECESSARY. AGAINST THE ASSESSES ARE CONTRARY DOCUMENTARY EVIDENCE FURNISHED BY ASSESSES BEFORE THE A.O AND NOT SUPPORTED BY ANY EVIDENCE: (VII) THE CONDITIONS CONTEMPLA TED ULS 80HHC STAND FULLY SATISFIED; (VIII) THE DEBP ISSUED BY DIRECTOR GENERAL OF FOREIGN TRADE REMAINS UNCHALLENGED BY THE RESPECTIVE DEPARTMENT OF THE CENTRAL GOVT: (IX) NO ACTION HAS BEEN TAKEN BY RESERVE BANK OF INDIA AND THEREFORE IT CANNOT BE SA ID THAT FOREIGN CURRENCY AS CONTEMPLATED U/S 80HHC WAS NOT RECEIVED BY THE ASSESSES. (X) THE FACT OF ACTUAL EXPORT HAS NOT BEEN DISPUTED BY ANY OF THE AUTHORITIES. IN VIEW THE ABOVE FACTS AND THE SETTLED LEGAL. POSITION, THE CIT (A) WAS NOT JUSTIFIED IN UPHOLDING THE ORDER OF THE A.O. 3. WITHOUT PREJUDICE TO THE ABOVE GROUNDS THE WITHDRAWAL OF THE DUTY DRAW BACK BY CUSTOM AUTHORITIES PER SE WOULD NOT BE DISENTITLE THE ASSESSEE FROM CLAIMING THE DEDUCTION UNDER SECTION 80HHC SINCE ALL THE CONDITION CONTEMPLATE UNDER THAT SECTION STAND SATISFIED. 4. THE APPELLANT CRAVES TO ADD, OR AMEND . 2. THE BRIEF FACTS OF THE CASE ARE THAT THE APPELLANT IS AN INDIVIDUAL. THE RET URNS OF INCOME FOR THE ASSESSMENT YEARS 2000 - 01 AND 2001 - 02 WERE FILED ON 30.10.2000 AND 31.10.2001 DECLARING INCOME OF RS. 30,392/ - AND RS. 16,48,033/ - RESPECTIVELY. THE RETURNS OF INCOME WERE ACCEPTED UNDER SECTION 142(1) OF THE INCOME - TAX ACT, 1961 (FOR SHORT THE ACT ) . SUBSEQUENTLY, NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED PROPOSING TO REOPEN THE ASSESSMENT BASED ON THE INFORMATION RECEIVED FROM THE INVESTIGATION WING OF THE 3 DEPARTMENT THAT THE APPELLANT IS INDULGING IN FRAUDULENT AVAILMENT OF DE PB, DBK AND 80HHC OF THE ACT. THE ASSESSMENTS WERE COMPLETED DENYING THE DEDUCTION UNDER SECTIONS 80HHC OF THE ACT VIDE ORDERS DATED 2 7 .12.2007 AND 24.11.2008 FOR THE ASSESSMENT YEARS 2000 - 01 AND 2001 - 02 RESPECTIVELY . AGAINST THIS ASSESSMENT ORDER, AN APPEAL WAS FILED FOR THE ASSESSMENT YEAR 2000 - 01 BEFORE THE C IT(A), WHO DISMISSED THE APPEAL VIDE PARA 7 OF HIS ORDER, WHICH READS AS UNDER: I HAVE GONE THROUGH THE ASSESSMENT ORDER AND THE SUBMISSION MADE BY THE APPELLANT. THE APPELLANT'S NON - COOPERAT ION WITH AO REVEALS MUCH MORE THAN IT CONCEALS. THE BOOKS OF ACCOUNT WAS NOT PRODUCED INSTEAD A COPY OF FIR FILED SHOWING LOSS OF BOOKS AND ALL BILLS RELATING TO PURCHASE AND SALE FOR FIVE YEARS. NO EXPLANATION WAS FILED WHEN CONFRONTED BY THE AO WITH REGA RD TO WRONG CLAIM OF DEDUCTION U/S 80HHC. IT IS STRANGE TO NOTE THAT THE BOOKS FOR ENTIRE 5 YEARS WERE LOST ALONG WITH SUPPORTING BILLS AND VOUCHERS OF PURCHASE AND SALES. WHY THE APPELLANT WAS CARRYING ENTIRE RECORD FOR FIVE YEARS WHEN STOLEN COULD NOT BE EXPLAINED. A VAGUE REPLY THAT HE HAD TO SHOW BOOKS TO CERTAIN AUTHORITIES IS FAR FROM THE TRUTH. HE DID NOT INDICATE TO WHICH AUTHORITY HE PRODUCED THE BOOKS BEFORE THEY ARE LOST. IN ABSENCE OF BOOKS AND VOUCHERS IT CANNOT BE SAID WITH CERTAINTY THAT HE E VER PURCHASED RAW MATERIALS AND MANUFACTURED GARMENTS. IN ABSENCE OF SUPPORTIVE EVIDENCE THE CLAIM OF DEDUCTION OF RS. 5,02,417/ - U/S 80HHC CANNOT BE CONSIDERED GENUINE PARTICULARLY IN THE LIGHT OF INPUTS FROM DEPTT. OF CUSTOM AND CENTRAL EXCISE. I, THEREF ORE, CONFIRM THE ADDITION. THE OTHER GROUNDS OF APPEAL ARE GENERAL IN NATURE AND REQUIRE NO COMMENT. NO. APPEAL BEFORE CIT(A) LIE WITH REGARD TO LEVY OF INTEREST U/S 234B & 234C AS THESE ARE CONSEQUENTIAL TO TAX DETERMINATION. REGARDING PENALTY NOTICE U/S 274, IT IS PREMATURE TO DEAL WITH THE ISSUE. 3 . THE APPEAL FILED FOR THE ASSESSMENT YEAR 2001 - 02 BEFORE THE CIT(A) WAS ALSO DISMISSED VIDE PARA 6, WHICH READS AS UNDER: 6. I HAVE GONE THROUGH THE ASSESSMENT ORDER. THE APPELLANT S NON - COOPERATIVE ATTITU DE REVEALS MUCH MORE THAN IT CONCEALS. THE BOOKS OF ACCOUNT WAS NOT PRODUCED INSTEAD A COPY OF FIR FILED SHOWING LOSS OF BOOKS. NO EXPLANATION WAS FILED WHEN CONFRONTED BY THE AO WITH REGARD TO WRONG CLAIM OF DEDUCTION U/S 80HHC. EVEN AT THE APPELLATE STAG E NO 4 SUBMISSION FILED IN SUPPORT OF HIS CLAIM. THUS IN ABSENCE OF ANY EVIDENCE TO THE CONTRARY THE CLAIM OF DEDUCTION OF RS. 59,67,448/ - U/S 80HHC CANNOT BE CONSIDERED GENUINE. I, THEREFORE, CONFIRM THE ADDITION. THE OTHER GROUNDS OF APPEAL ARE GENERAL IN NATURE AND REQUIRE NO COMMENT. NO APPEAL BEFORE CIT(A) LIE WITH REGARD TO LEVY OF INTEREST U/S 234A, 234B & 234C AS THESE ARE CONSEQUENTIAL TO TAX DETERMINATION. REGARDING PENALTY NOTICE U/S 274, IT IS PR EMATURE TO DEAL WITH THE ISSUE. BEING AGGRIEVED B Y THE ABOVE ORDER, THE PRESENT APPEALS WERE FILED BY THE ASSESSEE. 4 . THE APPELLANT HAD FILED AND ADDITIONAL GROUND VIDE HIS LETTER DATED 14 TH NOVEMBER, 2010. THE ADDITIONAL GROUND IS REPRODUCED AS UNDER: THAT THE REASSESSMENT PROCEEDINGS U/S 147 ARE BAD IN LAW SINCE NOT INITIATED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 147 TO 151 OF THE I.T. ACT, 1961 5. THE APPELLANT HAD FILED AN APPLICATION FOR ADMISSION OF ABOVE ADDITION AL GROUND STATING THAT THE APPEAL IS PURELY LEGAL IN NATURE AND DOES NOT REQUIRE ANY INVESTIGATION OF FACTS. HE RELIED UPON THE DECISIONS OF THE HON BLE APEX COURT IN THE CASE OF NTPC VS. CIT, 229 ITR 383 (SC), AND ON THE DECISION OF A COORDINATE BENCH OF IT AT, DELHI IN THE CASE OF M/S CALANCE SOFTWARE PVT. LTD. VS. DCIT, ITA NO. 4363/DEL/2010, DT. 1 6.01.2013. HE ALSO RELIED UPON THE DECISION OF HON BLE HIGH COURT OF BOMBAY IN THE CASE OF JEHAN GIR HC JEHANGIR VS. ITO, 12(3), [2015] 54 TAXMANN.COM 69 (BOM.) AN D ON THE DECISION OF HON BLE HIGH COURT OF DELHI IN THE CASE OF CIT VS. BHARAT ALUMINUM CO. LTD., [2010] 187 TAXMAN 111 (DELHI) . SINCE THIS GROUND GOES TO THE ROOT OF THE MATTER, WE SHALL FIRST DEAL WITH THE SAME. 6. THE LD . COUNSEL FOR THE APPELLANT CONTENDED THAT THE REASSESSMENT PROCEEDINGS WERE BAD IN LAW BECAUSE THE REASONS FOR ISSUANCE OF NOTICE UNDER 5 SECTION 148 OF THE ACT WERE RECORDED BY THE JOINT COMMISSIONER OF INCOME TAX WHO WAS NOT THE ASSESSING OFFICER OF THE AP PELLANT. ACCORDING TO HIM , THIS MEAN S THAT NO REASONS WERE RECORDED AT ALL. THE REASONS SO RECORDED DO NOT BEAR ANY DATE AT ALL . TH E INFORMATION RECEIVED FROM THE INVESTIGATION WING DOES NOT INDICATE THAT THE INFORMATION IS PERTAINING TO THE ASSESSMENT YEA R S 2000 - 01 & 2001 - 02 AND HE FURTHER SUBMITTED THAT THE ASSESSING OFFICER SIMPLY ACTED UPON THE INFORMATION RECEIVED FROM THE INVESTIGATION WING WITHOUT APPLYING HIS MIND INDEPENDENTLY. THEREFORE, HE SUBMITTED THAT THE REASSESSMENT PROCEEDINGS WERE BAD IN L AW AND CANNOT BE SUSTAINED IN THE EYE S OF LAW. IN SUPPORT OF THIS PROPOSITION , HE RELIED ON THE FOLLOWING DECISIONS : I. CIT VS. ATUL JAIN, 299 ITR 383 (DEL.) II. CIT VS. SUKHLAL ICE COLD STORAGE CO., 196 ITR 562 (ALL. ) III. MORARJI GOKULDASS SPG. & WVG. CO. VS. P.N. BANSAL, 208 ITR 471 (BOM.) IV. CIT VS. THAKURLAL, 132 ITR 398 (MP) V. SMT. BHAGWANTI VS. ITO, 7 TTJ 218 (CH.) VI. ITO VS. JOLLY MAKER, 20 TTJ 262 (BOM.) VII. TRAVANCORE ELECTRO CHEMICAL VS. ITO, 31 ITD 159. 7. HE FURTHER SUBMITTED THAT THERE WERE NO REASONS TO BELIEVE THAT THE INCOME GOT ESCAPED ASSESSMENT. 8. ON THE OTHER HAND, LD. SR. DR VEHEMENTLY OPPOSED THE ADMISSION OF ADDITIONAL GROUND AND FILED HIS WRITTEN SUBMISSIONS IN THIS REGARD. IT WAS CONTENDED THAT THE ISSUE OF VALIDITY/JURISDICTION OF ISSUANCE OF NOTIC E UNDER SECTION 148 OF THE ACT WAS NEVER RAISED EITHER BEFORE THE ASSESSING OFFICER OR BEFORE THE CIT(A) AND THE APPELLANT HAD SUBMITTE D TO THE ASSESSMENT PROCEEDINGS AND HE RELIED UPON THE DECISION OF HON BLE SUPREME COURT IN THE 6 CASE OF HIRA LAL VS. KALI NATH, AIR 1962 SC 199 FOR THE PROPOSITION THAT IF THE OBJECTION IS WAIVED, THE PARTY IS PRECLUDED FROM RA KING IT UP LATER. HE FURTHER RELIED ON THE DECISION OF A COORDINATE BENCH OF ITAT, GAUHATI IN THE CASE OF SUSHIL KUMAR JALAN VS. ITO, ITA NO. 34/GAU/20 11, DATED 03.02.2012, WHEREIN THE BENCH HELD THAT THE PARTICIPATION IN THE PROCEEDINGS AMOUNTS TO ACQUIESCENCE AND THEREBY THE ASSESSE IS E STOPPED FROM CONTENDING THE ISSUE FURTHER. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTIES AND PERUSED THE MAT ERIAL ON RECORD. THE GROUND RAISED BY THE APPELLANT GOES TO THE ROOT OF THE MATTER AND TOUCHING ON THE JURISDICTION OF THE CASE AND THE FACTS WHICH ARE REQUIRED FOR ADJUDICATION OF THIS GROUND OF APPEAL ARE ALREADY ON THE RECORD. THEREFORE, WE ARE OF THE C ONSIDERED OPINION THAT THE GROUND RA ISED BY THE APPELLANT CHALLENGES THE VERY VALIDITY OF THE PROCEEDINGS INITIATED UNDER THE PROVISIONS OF SECTION 147 OF THE ACT. IT IS A QUITE SETTLED PRINCIPLE OF LAW THAT THE GROUND CHALLENGING THE JURISDICTION CAN BE R AISED AT ANY STAGE OF PROCEEDINGS FOR THE FIRST TIME. IN THIS CONNECTION IT IS APT TO QUOTE THE JUDGMENT OF HON BLE GUJARAT HIGH COURT IN THE CASE OF P.V. DOSHI [1978] 113 ITR 22. THE RELEVANT PORTION IS EXTRACTED BELOW: IN THE CASE OF P.V. DOSHI [1978] 1 13 ITR 22 THIS HIGH COURT IN ALMOST IDENTICAL FACT SITUATION HELD THAT THE CONDITIONS PRESCRIBED FOR INITIATING REASSESSMENT PROCEEDINGS ARE MANDATORY AND, THEREFORE, THERE COULD NEVER BE A WAIVER OF A MANDATORY PROVISION. THAT JURISDICTION COULD NOT BE CO NFERRED ON THE AUTHORITY BY MERE CONSENT, BUT ONLY ON FULFILLMENT ON THE CONDITIONS PRECEDENT FOR THE EXERCISE OF JURISDICTION. IF THE JURISDICTION COULD NOT BE CONFERRED BY CONSENT, THERE WOULD BE NO QUESTION OF WAIVER, ACQUIESCENCE OR ESTOPPELS OR THE BA R OF RES JUDICATA BEING ATTRACTED BECAUSE THE ORDER IN SUCH A CASE WOULD LACK INHERENT JURISDICTION AND WOULD BE A VOID ORDER OR A NULLITY. THEREFORE, IN THE FACTS OF THE PRESENT CASE THE TRIBUNAL HAD WRONGLY COME TO THE CONCLUSION THAT THE ASSESSEE HAD W AIVED ITS RIGHT TO CHALLENGE REASSESSMENT PROCEEDINGS BEFORE 7 THE COMMISSIONER (APPEALS), AND WAS THUS NOT ENTITLED TO RAISE THE SAID CHALLENGE BEFORE THE TRIBUNAL 10. EVEN THE HON BLE APEX COURT IN THE CASE OF NTPC (SUPRA) HAD LAID DOWN THE PROPOSITION THAT WHERE THE TRIBUNAL IS ONLY REQUIRE D TO CONSIDER A QUESTION OF LAW ARISING FROM THE FACTS WHICH ARE ALREADY ON RECORD IN THE ASSESSMENT PROCEEDINGS , TH ERE IS NO REASO N WHY SUCH A QUESTION SHOULD NOT BE ALLOWED TO BE RAISED WHEN IT IS NECESSARY TO CONSIDER THAT QUESTION IN ORDER TO CORRECTLY ASSESS THE TAX LIABILITY OF AN ASSESSEE. 11. THEREFORE, RESPECTFULLY FOLLOWING THE RATIO LAID DOWN IN THE ABOVE CASE, WE HAVE NO HESITATION IN ADMITTING THIS GROUND OF APPEAL RELATING TO THE JURISDICTI ONAL ISSUE AND IT DOES NOT REQUIRE ANY INVESTIGATION OF FACTS. NOW, WE PROCEED TO ADJUDICAT E THIS GROUND OF APPEAL AS IT GOES TO THE VERY ROOT OF THE MATTER. 12 . LEARNED COUNSEL FOR TH E ASSESSEE CONTENDED THAT THE RECORDING OF REASONS UNDER SECTION 148(2) OF THE ACT IS A CONDITION P RECEDENT FOR ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT. IT WAS CONTENDED THAT FOR THE ASSESSMENT YEAR 2000 - 01, THE REASONS WERE RECORDED BY THE JOINT C OMMISSIONER OF INCOME TAX WITHOUT BEARING ANY DATE WHO IS NOT THEN THE ASS ESSING OFFICER OF THE APPELLANT. I N SUPPORT OF THIS, HE FILED THE PHOTOCOPIES OF THE ORDER SHEET. THEREFORE, ACCORDING TO HIM , IT AMOUN TS TO NON - RECORDING OF REASONS . FOR T HE ASSESSM ENT YEAR 2001 - 02, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AO HAD MERELY SENT A REPORT TO THE CIT(A) WITHOUT RECORDING THE REASONS AS CONTEMPLATED UNDER SECTION 148 OF THE ACT. IN THIS CONNECTION, HE FILED THE 8 CERTIFIED COPY OF THE REASONS G IVEN BY THE AO. HE FILED A PHOTOCOPY OF THE APPROVAL OBTAINED FROM THE JOINT COMMISSIONER OF THE INCOME TAX BY THE ASSESSING OFFICER. THEREFORE, ACCORDING TO HIM THERE WERE NO REASON S RECORD ED IN TERMS OF THE PROVISIONS OF L AW. IN THE ABSENCE OF REASONS, THE RE - ASSESSMENT PROCEEDINGS INITIATED ARE NULL AND VOID. IN THIS CONNECTION, HE RELIED UPON THE PLETHORA OF JUDGMENTS. 14. THE SECOND LIMB OF THIS ARGUMENT TOUCHING UPON THIS GROUND ARE THAT THE ASSESSING OFFICER MERELY ACTED UPON THE INFORMATION RECEIV ED FROM THE DIRECTOR OF INCOME TAX (INVESTIGATION) WITHOUT VERIFYING THE CORRECTNESS OF THE SAME INDEPENDENTLY AND WITHOUT ARRIVING AT AN INDEPENDENT SATISFACTION, THE NOTICES UNDER SECTION 148 OF THE ACT WERE ISSUED AND SUCH NOTICES ARE NOT VALID IN LAW A ND IN SUP PORT OF THIS PROPOSITION, HE RELIED UPON THE FOLLOWING DECISIONS: 1. CIT VS. ATUL JAIN, 299 ITR 383 (DEL.) 2. CIT VS. SIFL STOCK BROKING LTD., 325 ITR 285 (DEL.) 3. SARTHAK SECURITIES CO. PVT. LTD. VS. ITO, 2010 - TIOL - 726. 4. ITO VS. LAKHMANI MEWALDAS, 103 ITR 435 (SC) 5. CHHUGAMAL RAJPAL VS. S.P. CHALIHA, 79 ITR 603 (SC) 13 . THE THIRD LIMB OF HIS ARGUMENT IS THAT THE REASONS RECORDED BY THE ASSESSING OFFICER DO NOT CONTAIN ANY DATE AND FACTUALLY INCORRECT INFORMATION WAS RECOR DED. ACCORDING TO HIM, THESE INCONSI STENCIES SHOULD NOT LEAD TO THE ASSESSING OFFICER TO BELIEVE THAT THE INCOME GOT ESCAPED ASSESSMENT FROM TAX. FURTHER, HE SUBMITTED THAT THE INCONSISTENCIES RECORDED GOES TO PROVE THAT NO SATISFACTION WAS REACHED BY THE ASSESSING OFFICER. 14 . THE LAST LIMB OF ARGUMENT TOUCHING THE ISSUE OF JURISDICTION IS THAT THE APPROVAL UNDER SECTION 151 OF THE ACT WAS ACCORDED BY THE JOINT COMMISSIONER 9 OF INCOME TAX (MECHANICAL) WITH MERE STAMPED YES . THE SUBMISSION OF REPORT TO THE HIGHER AUTHORITIES DOES NOT DETERMI NE TO RECORDING OF SATISFACTION AT THE TIME OF GRANTING THE APPROVAL. IN SUPPORT OF THIS PROPOSITION, HE RELIED UPON THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF CHHUGMAL RAJPAL, 79 ITR 603 (SC) . 15 . ON THE OTHER HAND, THE LEARNED DR RELIED UPON T HE ORDERS OF THE AUTHORITIES BELOW ON THIS ISSUE. 16 . WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTIES AND CONSIDERED THE MATERIAL ON RECORD. THE ISSUE OF VALID NOTICE UNDER SECTION 148 IS A CONDITION PRECEDENT FOR EXERCISE OF VALID JURISDICTION OF REASSESSMENT. THE SATISFACTION OF THE CONDITION SPECIFIED UNDER SECTION 148(2) AS WELL AS SECTION 151 IS NECESSARY INGREDIENTS BEFORE EXERCISE OF JURISDICTION UNDER SECTION 147. IN THIS CASE, ON PERUSAL OF M ATERIAL , IT IS VERY CLEAR THAT FOR THE ASSESSMENT YEAR 2000 - 01, THE REASONS WERE NOT RECORDED BY THE AO HIMSELF , WHO ISSUED THE NOTICE UNDER SECTION 148. THE REASONS WERE RECORDED BY THE JOINT COMMISSIONER OF INCOME TAX ONE MR. A.K. MONGIA. WHEREAS, THE NO TICE UNDER SECTION 148 WAS ISSUED BY THE ASSESSING OFFICER I.E. ACIT, CIRCLE - 19(1), NEW DELHI. IT IS TRITE LAW THAT THE OFFICER WHO RECORDED THE REASONS IS ALONE ALLOWED TO ISSUE NOTICE UNDER SECTION 148. FOR THE ASSESSMENT YEAR 2001 - 02, THERE WAS NO REASO N RECORDED EXCEPT THE REPORT SENT SEEKING APPROVAL OF EITHER AUTHORITIES UNDER SECTION 151 OF THE ACT. WHEREAS THE PROVISIONS OF THE ACT CLEARLY STIPULATE THAT THE REASONS SHOULD BE RECORDED FIRST UNDER SECTION 148(2) AND THEN THE APPROVAL SHOULD BE SOUGHT . IN THIS CONNECTION, IT IS APT TO REFER THE FOLLOWING DECISIONS OF HON BLE HIGH COURT S : 10 I. CIT VS. ATUL JAIN, 299 ITR 383 (DEL.) II. CIT VS. K.G. MADAN, 275 ITR 294 (P&H) III. CIT VS. RAJINDRA ROSIN & TURPENTINE INDUSTRIES, 305 ITR 161 (P&H) IV. DIT ( INTERNATIONAL TAXATI ON) VS. MA Y AND BA KER S LTD., 345 ITR 87 V. SOH ANARAJ VS DCI T, 322 ITR 213 1 7 . FROM THE ABOVE DECISIONS, IT IS CLEAR THAT I N THE ABSENCE OF PROPER RECORDING OF REASONS AS MANDATED UNDER THE PROVISIONS OF SUB - SECTION 2 OF SECTION 148 , THE ASSESSMENT CANNOT BE HELD TO BE VALID. RESPECTFULLY FOLLOWING THIS RATIO, WE QUASH THE REASSESSMENT PROCEEDINGS AS NULL AND VOID AB INITIO . ON THE BASIS OF THE FIRST LIMB OF ARGUMENT ITSELF OF THE LEARNED COUNSEL FOR THE ASSESSEE, THERE IS NO NEED TO REFER TO THE OTHER LIMBS OF HIS ARGUMENTS AND SECONDLY, SINCE THE REASSESSMENTS PROCEEDINGS HAVE BEEN QUASHED, IT IS NOT NECESSARY TO ADJUDICATE UPON THE GROUNDS RELATING TO THE MERITS OF THE ADDITION. HENCE, BOTH THE APPEALS FILED BY THE ASSESSEE COMPANY ARE ALLOWED. 18 . IN THE RESULT, BOTH THE APPEALS ARE ALLOWED. THE DECISION IS PRONOUNCED IN THE OPEN COURT ON 19 TH AUGUST , 2015. S D / - S D / - ( G.C. GUPTA ) (INTURI RAMA RAO) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 1 9 T H AUGUST , 2015. RK/ - COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI