DCIT Ratnagiri Cir, Ratnagiri V. Shri Suresh T Gundecha, Ratnagiri

ITA 200/PUN/2012

• Counselvise Citation: 20024514 RSA 2012
• Duration Of Justice: 1 year(s) 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 24-09-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 02-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S C SARANGI
• Assessee Lawyers: RAJESH SANGHAVI
• Keywords: Reason to believe; Reassessment proceedings
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.200/PN/2012 (ASSESSMENT YEAR : 2006-07) DY. COMMISSIONER OF INCOME TAX, RATNAGIRI CIRCLE, RATNAGIRI . APPELLANT VS. SHRI SURESH T. GUNDECHA M/S ARIHANT CONSTRUCTION RAM LANE RATNAGIRI PAN : ABGPG8997B . RESPONDENT DEPARTMENT BY : MR. S. C. SARANGI ASSESSEE BY : MR. RAJESH SANGHAVI DATE OF HEARING : 24-09-2013 DATE OF PRONOUNCEMENT : 27-09-2013 ORDER PER G. S. PANNU, AM THE CAPTIONED APPEAL HAS BEEN PREFERRED BY THE REV ENUE WHICH IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME TAX (APPEALS), KOLHAPUR DATED 25.11.2011 WHICH, IN TURN, HAS ARISE N FROM AN ORDER DATED 31.12.2010 PASSED BY THE ASSESSING OFFICER, UNDER S ECTION 143(3) READ WITH SECTION 147 OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2006-07. 2. IN THIS APPEAL, THE REVENUE IS AGGRIEVED THE ACT ION OF THE CIT(A) IN HOLDING THAT THE REOPENING OF THE ASSESSMENT BY THE ASSESSING OFFICER UNDER SECTION 147 OF THE ACT IS BAD IN LAW THEREBY CANCEL LING THE ASSESSMENT ORDER DATED 31.12.2010. 3. IN BRIEF, THE FACTS ARE THAT ASSESSEE IS, AN IND IVIDUAL, ENGAGED IN THE BUSINESS OF BUILDER AND DEVELOPER. FOR THE ASSESSME NT YEAR 2006-07, ASSESSEE FILED A RETURN OF INCOME WHICH INTER-ALIA INCLUDED PROFIT FROM EXECUTION OF HOUSING PROJECT OF RS.1,11,20,373/-, W HICH WAS CLAIMED AS EXEMPT UNDER SECTION 80-IB(10) OF THE ACT. THE ASSE SSING OFFICER COMPLETED ITA NO.200/PN/2012 A.Y. 2006-07 SCRUTINY ASSESSMENT UNDER SECTION 143(3) OF THE ACT DATED 28.03.2008 DETERMINING THE TOTAL INCOME AT RS.40,62,494/- AND THE DEDUCTION CLAIMED UNDER SECTION 80-IB(10) WAS ALLOWED AT RS.1,11,20,3 73/-. SUBSEQUENTLY, THE ASSESSING OFFICER REOPENED THE ASSESSMENT BY ISSUIN G NOTICE UNDER SECTION 148 OF THE ACT DATED 31.03.2010 FOR THE REASON THAT CERTAIN INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT INASMUCH AS THE DEDUC TION UNDER SECTION 80-IB(10) WAS WRONGLY ALLOWED IN THE ASSESSMENT ORD ER DATED 28.03.2008. IN THE CONSEQUENTIAL ASSESSMENT FINALIZED UNDER SECTIO N 143(3) READ WITH SECTION 147 OF THE ACT DATED 31.12.2010, THE ASSESS ING OFFICER DETERMINED THE TOTAL INCOME AT RS.1,51,82,867/- THEREBY DISALLOWIN G THE DEDUCTION EARLIER ALLOWED UNDER SECTION 80-IB(10) OF THE ACT AMOUNTIN G TO RS.1,11,20,373/-. THE DEDUCTION UNDER SECTION 80-IB(10) WAS DENIED ON THE GROUND THAT ASSESSEE DID NOT FULFILL THE CONDITION PRESCRIBED IN CLAUSE (D) OF SECTION 80-IB(10) OF THE ACT. 4. IN APPEAL BEFORE THE CIT(A), ASSESSEE ASSAILED T HE ORDER OF THE ASSESSING OFFICER IN LAW AND ON FACTS. THE REOPENIN G OF ASSESSMENT BY INVOKING SECTION 147/148 OF THE ACT WAS ASSAILED IN TER-ALIA ON THE GROUND THAT THERE WAS ABSENCE OF ANY COGENT REASONS TO ESTABLIS H ANY ESCAPEMENT OF INCOME AND THAT THE REOPENING WAS DONE ON A MERE SU SPICION. IT WAS ALSO CONTENDED THAT THE ASSESSING OFFICER HAD UNJUSTLY D ENIED THE DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT INASMUCH AS THE ASSESS EE FULFILLED ALL THE CONDITIONS PRESCRIBED THEREIN. THE CIT(A) EXAMINED THE REASONS RECORDED BY THE ASSESSING OFFICER TO ISSUE NOTICE UNDER SECTION 148 OF THE ACT AND CONCLUDED THAT THERE WAS NO EVIDENCE WITH THE ASSES SING OFFICER TO FORM A PRIMA-FACIE BELIEF THAT THE DEDUCTION UNDER SECTION 80-IB(10) WAS WRONGLY ALLOWED. THE CIT(A) CONCLUDED, AFTER APPRAISING THE FACTS ON RECORD, THAT NONE OF THE INGREDIENTS REQUIRED FOR INVOKING OF SECTION 147 OF THE ACT WERE FULFILLED IN THE PRESENT CASE AND THEREFORE HE PROCEEDED TO H OLD THAT THE INVOKING OF SECTION 147/148 OF THE ACT WAS BAD IN LAW AND THERE FORE HE CANCELLED THE ASSESSMENT ORDER DATED 31.12.2010 (SUPRA). AS A CON SEQUENCE OF HIS ORDER ITA NO.200/PN/2012 A.Y. 2006-07 ON THE VALIDITY OF THE PROCEEDINGS INITIATED UNDER SECTION 147/148 OF THE ACT, THE CIT(A) HELD THAT THE ISSUE REGARDING THE MERITS OF THE DISALLOWANCE OF DEDUCTION UNDER SECTION 80-IB(10) WAS RENDERED ACAD EMIC AND WAS NOT DELIBERATED UPON. IN THIS BACKGROUND, THE REVENUE H AS CHALLENGED THE STAND OF THE CIT(A) IN HOLDING THAT THE INVOKING OF SECTI ON 147/148 OF THE ACT WAS BAD IN LAW. 5. BEFORE US, THE LEARNED DEPARTMENTAL REPRESENTATI VE SUBMITTED THAT CLAUSE (C) OF EXPLANATION (2) TO SECTION 147 OF THE ACT COVERS THE CONTROVERSY INASMUCH THE ESCAPEMENT OF INCOME IN THE PRESENT CA SE IS ESTABLISHED ON ACCOUNT OF WRONG ALLOWANCE OF DEDUCTION UNDER SECTI ON 80-IB(10) OF THE ACT. THE LEARNED DEPARTMENTAL REPRESENTATIVE POINTED OUT TO PARA 6(V) OF THE ASSESSMENT ORDER TO SHOW THAT THE ACTUAL BUILT-UP A REA OF THE SHOPS/COMMERCIAL ESTABLISHMENTS IN THE HOUSING PROJ ECT OF THE ASSESSEE TOTALLED TO 2192 SQ.FT. WHICH WAS MORE THAN THE LIM IT OF 2000 SQ.FT. PRESCRIBED IN CLAUSE (D) TO SECTION 80-IB(10) OF THE ACT AND THER EFORE, THE CLAIM OF DEDUCTION OF SECTION 80-IB(10) WAS RIGHTLY HELD TO BE WRONGLY ALLOWED IN THE ORIGINAL ASSESSMENT, WHICH LED TO FORMATION OF BELIEF BY THE ASSESSING OFFICER THAT TO SUCH AN EXTENT, INCOME CHARGEABLE TO TAX HAD ESCAPE D ASSESSMENT. IN THIS MANNER, THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS SOUGHT TO DEFEND THE INITIATION OF PROCEEDINGS BY THE ASSESSING OFFICER BY INVOKING OF SECTION 147/148 OF THE ACT IN THE PRESENT CASE. 6. ON THE OTHER HAND, LEARNED COUNSEL APPEARING FOR THE RESPONDENT- ASSESSEE SUBMITTED THAT THE CIT(A) HAS ANALYZED THE REASONS RECORDED BY THE ASSESSING OFFICER FOR ISSUANCE OF NOTICE UNDER SECT ION 148 OF THE ACT AND FOUND THAT THERE WAS NO MATERIAL TO SAY THAT THE PR OVISIONS OF SECTION 80-IB(10)(D) OF THE ACT WERE VIOLATED. THE LEARNED COUNSEL POINTED OUT THAT THE DISCUSSION IN THE REASONS RECORDED DO NOT SHOW EXIS TENCE OF COMMERCIAL AREA IN THE HOUSING PROJECT IN EXCESS OF THE LIMIT PRESC RIBED IN SECTION 80-IB(10)(D) OF THE ACT AND THEREFORE THE CIT(A) JUSTIFIABLY HEL D THAT THE ASSESSING OFFICER ITA NO.200/PN/2012 A.Y. 2006-07 HAD NO MATERIAL WITH HIM WHICH WOULD LEAD TO A PRIM A-FACIE BELIEF THAT DEDUCTION UNDER SECTION 80-IB(10) WAS WRONGLY ALLOW ED ON ACCOUNT OF VIOLATION OF SECTION 80-IB(10)(D) OF THE ACT. REFER RING TO PARA 6(V) OF THE ASSESSMENT ORDER RELIED UPON BY THE LEARNED DEPARTM ENTAL REPRESENTATIVE, THE LEARNED COUNSEL POINTED OUT THAT AREA OF COMMER CIAL ESTABLISHMENTS ENUMERATED THERE, IS PURPORTEDLY BASED ON MEASUREME NTS CARRIED OUT BY THE ASSESSING OFFICER DURING HIS VISIT TO HOUSING PROJE CT ON 24.12.2010, WHICH WAS MUCH AFTER THE ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT AND THE SAME WAS MADE ONLY DURING THE COURSE OF IMPUGNED ASSESSM ENT PROCEEDINGS. EVEN OTHERWISE, THE LEARNED COUNSEL HAS SOUGHT TO POINT OUT THAT EVEN ON FACTS, THE AFORESAID OBSERVATION OF THE ASSESSING OFFICER IS I NCORRECT. IN SUM AND SUBSTANCE, THE LEARNED COUNSEL HAS DEFENDED THE CON CLUSION DRAWN BY THE CIT(A) BY POINTING OUT THAT AT THE TIME OF RECORDIN G OF REASONS TO INITIATE THE PROCEEDINGS UNDER SECTION 147/148 OF THE ACT, THERE WAS NO MATERIAL OR EVIDENCE TO SHOW THAT THE ASSESSEE HAD VIOLATED THE CONDITION PRESCRIBED IN CLAUSE (D) TO SECTION 80-IB(10) OF THE ACT. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. IN THE PRESENT CASE, THE CRUX OF THE CONTROVERSY IS THE VALIDITY O F PROCEEDINGS INITIATED BY THE ASSESSING OFFICER BY INVOKING SECTION 147/148 OF TH E ACT. SECTION 147 OF THE ACT PERMITS AN ASSESSING OFFICER, IF HE HAS REASONS TO BELIEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY AS SESSMENT YEAR, TO ASSESS OR RE-ASSESS SUCH INCOME SUBJECT TO THE PROV ISIONS OF SECTIONS 148 TO 153 OF THE ACT. FURTHER, SECTION 148(1) OF THE ACT PRESCRIBES THAT BEFORE MAKING SUCH ASSESSMENT OR RE-ASSESSMENT UNDER SECTI ON 147, THE ASSESSING OFFICER SHALL SERVE A NOTICE ON THE ASSESSEE REQUIR ING HIM TO FURNISH A RETURN OF HIS INCOME IN THE MANNER PRESCRIBED THEREIN. SUB-SE CTION (2) OF SECTION 148 FURTHER PRESCRIBES THAT THE ASSESSING OFFICER SHALL , BEFORE ISSUING ANY NOTICE UNDER SECTION 148(1), RECORD HIS REASONS FOR DOING SO. IT WOULD BE PERTINENT TO NOTE THAT SECTION 147 OF THE ACT CONTAINS A SIGNIFI CANT EXPRESSION I.E. HAS A REASON TO BELIEVE . IN OTHER WORDS, INVOKING OF SECTION 147 IS PERMIS SIBLE ONLY ITA NO.200/PN/2012 A.Y. 2006-07 IN CASE THE ASSESSING OFFICER HAS REASONS TO BELIEV E THAT CERTAIN INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. IN TERMS OF SECTION 148(2) OF THE ACT, THE ASSESSING OFFICER IS FURTHER REQUIRED TO R ECORD SUCH REASONS BEFORE ISSUING NOTICE UNDER SECTION 148 OF THE ACT. IT IS A TRITE LAW THAT THE REASONS MUST HAVE A RATIONAL CONNECTION OR RELEVANT BEARING ON THE FORMATION OF BELIEF ABOUT ESCAPEMENT OF INCOME. IT IS ALSO WELL-UNDERST OOD THAT REASON TO BELIEVE MUST BE HONEST AND NOT BASED ON SUSPICION OR CONJEC TURES. AS PER THE HONBLE SUPREME COURT IN THE CASE OF ITO VS. LAKHMANI MEWAL DAS (1976) 103 ITR 437 (SC) THE MATERIAL ON RECORD SHOULD BE SUCH WHIC H CAN PRIMA-FACIE LEAD TO AN INFERENCE THAT CERTAIN INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. PERTINENTLY, AS PER THE HONBLE SUPREME COURT THERE SHOULD BE A RATIONAL CONNECTION, DIRECT NEXUS OR A LIVE LINK BETWEEN THE MATERIAL AND BELIEF. IF THERE IS NO RATIONAL OR AN INTELLIGIBLE NEXUS BETWEEN THE MATERIAL AND BELIEF, SO THAT ON SUCH REASONS NO ONE PROPERLY INSTRUCTED ON FACTS AND IN LAW COULD REASONABLY ENTERTAIN THE BELIEF, THE CONCLUSION WOU LD BE INESCAPABLE THAT THE ASSESSING OFFICER COULD NOT HAVE REASON TO BELIEVE THAT ANY INCOME HAD ESCAPED ASSESSMENT. 8. IN THE ABOVE BACKGROUND, WE MAY NOW PERUSE THE R EASONS RECORDED IN THE PRESENT CASE TO EXAMINE WHETHER THERE IS A RATI ONAL CONNECTION, DIRECT NEXUS OR A LIVE LINK BETWEEN THE MATERIAL AND BELIE F FORMED BY THE ASSESSING OFFICER FOR ESCAPEMENT OF INCOME TO THE EFFECT THAT THE DEDUCTION UNDER SECTION 80-IB(10) WAS WRONGLY ALLOWED TO THE ASSESS EE ON ACCOUNT OF NON- COMPLIANCE WITH THE CONDITION PRESCRIBED IN CLAUSE (D) TO SECTION 80-IB(10) OF THE ACT. 9. THE REASONS RECORDED BY THE ASSESSING OFFICER HA VE BEEN REPRODUCED BY THE CIT(A) IN PARA 9 OF HIS ORDER AND ARE NOT BE ING REPRODUCED IN THIS ORDER FOR THE SAKE OF BREVITY. A PERUSAL OF THE SAID REAS ONS RECORDED SHOW THE ULTIMATE CONCLUSION IS THAT THE CONDITION PRESCRIBE D IN CLAUSE (D) TO SECTION 80-IB(10) OF THE ACT IS VIOLATED AND THEREFORE THE PROFITS DERIVED FROM THE ITA NO.200/PN/2012 A.Y. 2006-07 HOUSING PROJECT ARE LIABLE TO BE TAXED AND NOT EXEM PT UNDER SECTION 80-IB(10) OF THE ACT. PERTINENTLY, THE PROFITS DERIVED FROM D EVELOPMENT AND CONSTRUCTION OF A HOUSING PROJECT ARE EXEMPT UNDER SECTION 80-IB (10) OF THE ACT, SUBJECT TO FULFILLMENT OF CERTAIN CONDITIONS PRESCRIBED THEREI N. ONE SUCH CONDITION IS CONTAINED IN CLAUSE (D) TO SECTION 80-IB(10) OF THE ACT IS TO THE EFFECT THAT BUILT- UP AREA OF THE SHOPS AND OTHER COMMERCIAL ESTABLISH MENTS INCLUDED IN THE HOUSING PROJECT DOES NOT EXCEED 5% OF THE AGGREGATE BUILT-UP AREA OF THE HOUSING PROJECT OR 2000 SQ.FT. WHICHEVER IS HIGHER. 10. IN THE ABOVE BACKGROUND, WE HAVE EXAMINED THE M ATERIAL REFERRED BY THE ASSESSING OFFICER IN THE REASONS RECORDED, NAME LY, (I) REPORT OF THE AUDITOR IN FORM NO. 10CCB WHEREIN BUILT-UP AREA OF THE COMMERCIAL ESTABLISHMENTS IS SHOWN AT 1985 SQ.FT.; (II) LETTER OF THE COLLECTOR OF RATNAGIRI GRANTING APPROVAL DATED 08.10.2004 WHEREIN THE TOTA L COMMERCIAL STRUCTURE IS STATED AT 1990 SQ.FT.; AND, (III) CERTIFIED COPY OF THE PLAN SANCTIONED BY RATNAGIRI MUNICIPAL COUNCIL DATED 14.12.2005 WHEREI N THE TOTAL BUILT-UP AREA OF THE COMMERCIAL ESTABLISHMENTS IS SHOWN AT 1842.45 S Q.FT.. AFTER REFERRING TO THE AFORESAID MATERIAL, THE ASSESSING OFFICER GOES ON T O CONCLUDE IN THE REASONS RECORDED THAT THE CONDITION PRESCRIBED IN SECTION 8 0-IB(10) OF THE ACT IS VIOLATED. CURIOUSLY, NONE OF THE MATERIAL REFERRED BY THE ASSESSING OFFICER IN THE REASONS RECORDED SHOW THAT THE BUILT-UP AREA OF THE COMMERCIAL ESTABLISHMENTS IN THE HOUSING PROJECT BREACHES THE LIMITS PRESCRIBED IN CLAUSE (D) TO SECTION 80-IB(10) OF THE ACT. FACTUALLY SPEA KING, THE MATERIAL REFERRED IN THE REASONS RECORDED DOES NOT CONSTITUTE ANY RATION AL CONNECTION WITH FORMATION OF BELIEF THAT INCOME CHARGEABLE TO TAX H AD ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE ACT IN THE PRESENT CASE BECAUSE THE MATERIAL REFERRED DOES NOT SHOW ANY VIOLATION OF CL AUSE (D) TO SECTION 80- IB(10) OF THE ACT, SO AS TO DISQUALIFY THE ASSESSEE FROM THE CLAIM OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT. WE AGAIN EMPHAS ISE THAT THE MATERIAL REFERRED TO BY THE ASSESSING OFFICER DOES NOT SHOW VIOLATION OF THE CONDITION PRESCRIBED IN CLAUSE (D) TO SECTION 80-IB(10) OF TH E ACT, AS SOUGHT TO BE ITA NO.200/PN/2012 A.Y. 2006-07 INFERRED BY THE ASSESSING OFFICER IN THE REASONS RE CORDED. THEREFORE, ON SUCH REASONS, IN OUR VIEW, THE CIT(A) CORRECTLY HELD THA T THE ASSESSING OFFICER COULD NOT ENTERTAIN REASONS TO BELIEVE THAT ANY INCOME CH ARGEABLE TO TAX HAD ESCAPED ASSESSMENT QUA THE ALLOWANCE OF DEDUCTION U NDER SECTION 80-IB(10) OF THE ACT. WE FIND NO FAULT ON THE PART OF THE CIT (A) IN HOLDING THAT THE REOPENING UNDER SECTION 147 OF THE ACT IS BAD IN LA W. 11. BEFORE PARTING, WE MAY ALSO REFER TO THE ASSERT ION OF THE LEARNED DEPARTMENTAL REPRESENTATIVE WITH REFERENCE TO PARA 6(V) OF THE ASSESSMENT ORDER WHEREIN THE TOTAL BUILT-UP AREA OF THE SHOPS AND COMMERCIAL ESTABLISHMENTS IN THE HOUSING PROJECT STATED TO BE 2192.34 SQ.FT., WHICH ACCORDING TO HIM IS IN EXCESS OF LIMITS PRESCRIBED IN SECTION 80-IB(10)(D) OF THE ACT. ON THIS BASIS, THE INITIATION OF PROCEEDINGS U NDER SECTION 147/148 IS SOUGHT TO BE DEFENDED. IN THIS CONNECTION, WE MAY N OTICE THAT THE DISCUSSION IN PARA 6(V) OF THE ASSESSMENT ORDER IS BASED ON TH E MEASUREMENTS OF THE COMMERCIAL AREA CARRIED OUT BY THE ASSESSING OFFICE R DURING HIS PERSONAL VISIT TO THE HOUSING PROJECT ON 24.12.2010. EVEN IF THE A FORESAID OBSERVATIONS OF THE ASSESSING OFFICER ARE TAKEN TO BE CORRECT, YET THE SAID INFORMATION CAME TO LIGHT ONLY ON 24.12.2010, AS STATED BY THE ASSESSIN G OFFICER IN PARA 6(V) OF ASSESSMENT ORDER, AND WAS NOT AVAILABLE AT THE TIME OF HIS FORMATION OF BELIEF THAT CERTAIN INCOME CHARGEABLE TO TAX HAS ESCAPED A SSESSMENT ON ACCOUNT OF WRONG ALLOWANCE OF DEDUCTION UNDER SECTION 80-IB(10 ) OF THE ACT. IN OTHER WORDS, IN SO FAR AS THE MATERIAL ON RECORD AT THE T IME OF RECORDING OF REASONS PRESCRIBED UNDER SECTION 147 OF THE ACT IS CONCERNE D, THERE WAS NO MATERIAL WITH THE ASSESSING OFFICER TO THE DEMONSTRATE, EVEN ON A PRIMA-FACIE BASIS, THAT THE BUILT-UP AREA OF THE SHOPS/COMMERCIAL ESTA BLISHMENTS IN THE HOUSING PROJECT WAS VIOLATIVE OF THE CONDITION PRESCRIBED I N CLAUSE (D) TO SECTION 80- IB(10) OF THE ACT. THEREFORE, ON THE BASIS OF SUBSE QUENT INFORMATION, THE FORMATION OF BELIEF, ON AN ANTERIOR DATE OF ESCAPEM ENT OF INCOME CANNOT BE JUSTIFIED. IT IS A SETTLED-LAW THAT THE VALIDITY OF INITIATION OF REASSESSMENT PROCEEDINGS HAS TO BE JUDGED WITH REFERENCE TO THE MATERIAL AVAILABLE WITH THE ITA NO.200/PN/2012 A.Y. 2006-07 ASSESSING OFFICER AT THE TIME OF ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT AND IT CANNOT BE SOUGHT TO BE SUBSTANTIATED BY REFERENCE TO MATERIAL THAT MAY COME TO LIGHT SUBSEQUENTLY IN THE COURSE OF REA SSESSMENT PROCEEDINGS. THUS, THE PLEA OF THE LEARNED DEPARTMENTAL REPRESEN TATIVE IS HEREBY REJECTED. 12. IN THE LIGHT OF THE AFORESAID DISCUSSION, WE TH EREFORE, CONCLUDE BY HOLDING THAT THE CIT(A) MADE NO MISTAKE IN CANCELLI NG THE ASSESSMENT ORDER DATED 31.12.2010 ON THE GROUND THAT THE INITIATION OF PROCEEDINGS UNDER SECTION 147/148 OF THE ACT IN THE PRESENT CASE WAS BAD IN LAW. THE ORDER OF THE CIT(A) IS HEREBY AFFIRMED. 13. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH SEPTEMBER, 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 27 TH SEPTEMBER, 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A), KOLHAPUR; 4) THE CIT, KOLHAPUR; 5) THE DR, B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE