Parvez Cavas Damania, Mumbai V. Deputy Commissioner of Income-tax,

ITA 201/PUN/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1593 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 14-06-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 09-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL CHAWARE
• Keywords: Reopening of assessment; Principle of natural justice; Reason to believe; Reassessment proceedings
• Section: 143(3); 147; 148

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , BEFORE MS. SUSHMA CHOWLA, JM . / ITA NO. 201 /PN/201 6 / ASSESSM ENT YEAR : 20 0 7 - 0 8 PARVEZ CAVAS DAMANIA, 604/C, LAXMI NIWAS, LADY JEHANGIR ROAD, PARSI COLONY, DADAR, MUMBAI - 4 00 01 4 . / APPELLANT PAN: A A XPD3653R VS. THE DY. COMMISSIONER OF INCOME TAX, THE DY. COMMISSIONER OF INCOME TAX, AHMEDNAGAR CIRCLE, AHMEDNAGAR . / RESPONDENT / APPELLANT BY : SHRI NEELESH KHANDELWAL / RESPONDENT BY : SHRI ANIL CHAWARE / DATE OF HEARING : 15 . 0 6 .201 6 / DATE OF PRONOUNCEMENT: 08 . 0 7 .201 6 / ORDER PER SUSHMA CHOWLA, J M : TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - 2 , PUNE , DATED 09 . 1 0 .20 1 5 RELATING TO ASSESSMENT YEAR 20 0 7 - 0 8 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 2 2 . THE ASSESS EE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE CASE OF YOUR APPELLANT WAS SELECTED FOR SCRUTINY ON THE BASIS OF AIR DATA FOR DEPOSITING RS.2,29,806/ - IN HO NG KONG & SHANGHAI BANKING CORPORATION LTD ONLY. THE ADDITION MADE ON THIS ACCOUNT IN TO TH E SAVING BANK ACCOUNT AND DISALLOWANCES OF PROFESSIONAL EXPENSES ARE UNJUST AGAINST PROVISION OF LAW. THE REASONS FORWARDED FOR NON PRODUCTION OF BANK STATEMENT MAY PLEASE BE SEEN IN PRACTICAL ANGLE . 2. ON FACTS & CIRCUMSTANCES PREVAILING IN THE CASE & AS PER PROVISION OF LAW IT BE HELD THAT ADDITION OF RS.3,41,296/ - DISALLOWED OUT OF THE CLAIM OF THE EXPENSES AND DEPOSITING IN SAVINGS BANK ACCOUNT IS UNWARRANTED, UNJUSTIFIED & IMPROPER & CONTRARY TO THE PROVISIONS OF THE LAW & FACTS PREVAILING IN THE C ASE. THE ADDITION SO MADE ARBITRARILY MAY PLEASE BE DELETED. THE APPELLANT MAY PLEASE BE GRANTED JUST & PROPER RELIEF IN THIS RESPECT. 3. THE LD COMMISSIONER OF INCOME TAX (APPEALS) HAS NOT APPRECIATED THE FACT OF THE CASE AND SUBMISSION FILED BEFORE THE DURING THE COURSE OF HEARING AND PASSED THE ORDER, REJECTING THE SUBMISSION AND CONFIRMING THE ASSESSING OFFICER ORDER, WHICH IS IMPROPER AND AGAINST JUSTICE. THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - II IS PASSED IN VIOLATION OF RUL ES OF NATURAL JUSTICE AND MAY PLEASE BE HELD AS VITIATED AND BE SET ASIDE. SO A L SO PRESERVATION OF BOOKS OF ACCOUNTS FOR FINANCIAL YEAR 2006 - 07 IS PRACTICALLY AND TECHNICALLY IMPOSSIBLE. THE VOUCHERS OF EXPENSES PRODUCED BEFORE THE ASSESSING OFFICER ARE G ENUINE AND SO THE DISALLOWANCES OF EXPENSES NEEDS TO BE DELETED. 4. RETURNED INCOME BE ACCEPTED AND ADDITIONS MADE NEEDS TO BE FULLY DELETED. 3. IN ADDITION TO THE GROUNDS OF APPEAL ORIGINALLY RAISED, THE ASSESSEE HAS FILED ADDITIONAL GROUND OF APPEAL WHICH READ S AS UNDER: - ON FACTS AND CIRCUMSTANCES PREVAILING IN THE CASE AND AS PER PROVISIONS OF LAW, IT BE HELD THAT, THE ASSESSMENT FRAMED U/S.147 R.W.S. 143(3) OF THE ACT IS WITHOUT FOLLOWING THE LAW AND THE PROVISIONS OF INCOME - TAX ACT, 1961 . THE AS SESSMENT SO FRAMED DESERVED TO BE QUASHED. JUST AND PROPER RELIEF BE GRANTED TO THE APPELLANT IN THIS RESPECT. 4. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE AT THE OUTSET POINTED OUT THAT THE ADDITIONAL GROUND OF APPEAL RAISED WAS AGAINST JU RISDICTION OF RE - ASSESSMENT MADE IN THE CASE OF ASSESSEE AND THE SAME MAY BE DECIDED FIRST BEFORE DECIDING THE ISSUE RAISED ON MERITS. HE FURTHER SUBMITTED THAT THE ADDITIONAL GROUND OF APPEAL RAISED IS A PURELY LEGAL GROUND, WHICH GOES TO THE ROOT OF THE MATTER AND THE SAME BE ADMITTED AND ADJUDICATED IN THE INTEREST OF JUSTICE. ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 3 5. THE ADDITIONAL GROUND OF APPEAL RAISED BY THE ASSESSEE IS AGAINST INVOKING OF PROVISIONS OF SECTION 147 R.W.S. 143(3) OF THE ACT WITHOUT FOLLOWING DUE PROCESS OF LAW AND THE PR OVISIONS OF INCOME TAX ACT, BEING PURELY LEGAL, THE SAME IS ADMITTED FOR ADJUDICATION IN THE INTEREST OF JUSTICE. 6. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE HAD FILED RETURN OF INCOME ON 22.02.2008 DECLARING TOTAL INCOME OF RS.8,08,450/ - . THE ASS ESSING OFFICER ON THE BASIS OF AIR DATA NOTED THAT THE ASSESSEE HAD DEPOSITED SUM OF RS. 2,29,806/ - ON 31.03.2007 IN THE BANK ACCOUNT MAINTAINED WITH HONG KONG & SHANGHAI BANKING CORPORATION LTD. , WHICH WAS NOT CONSIDERED WHILE FILING THE RETURN OF INCOME. THEREFORE, NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON 29.03.2014 AFTER TAKING PRIOR APPROVAL UNDER SECTION 151(2) OF THE ACT FROM JCI T, AHMEDNAGAR RANGE, AHMEDNAGAR. THE SAID NOTICE UNDER SECTION 148 OF THE ACT WAS SERVED UPON THE ASSESSEE ON 30.0 3.2014. IN COMPLIANCE, THE ASSESSEE FILED A LETTER ON 21.04.2014 STATING THAT HE HAD ALREADY FILED RETURN OF INCOME FOR THE INSTANT ASSESSMENT YEAR AND THE SAME MAY BE TREATED AS RETURN OF INCOME IN RESPONSE TO THE NOTICE ISSUED UNDER SECTION 148 OF THE A CT. THEREAFTER, THE ASSESSEE WAS ASKED TO FURNISH COPY OF ACCOUNT WITH THE SAID BANK ACCOUNT AND THE ASSESSMENT PROCEEDINGS WERE CARRIED OUT RESULTING IN AN ADDITION OF RS. 2,29,806/ - AND DISALLOWANCE OF EXPENDITURE OF RS. 1,11,490/ - . 7. BEFORE THE CIT(A), THE ASSESSEE CLAIMED THAT NOTICE ISSUED UNDER SECTION 148 OF THE ACT WAS TIME BARRED. HOWEVER, THE ASSESSEE FURNISHED SUBMISSIONS THAT THE NOTICE ISSUED WAS WITHIN TIME AND WAS ISSUED AFTER OBTAINING APPROVAL, BUT THE REQUEST OF ASSESSEE TO GIVE REASONS RECORDED FOR REOPENING THE ASSESSMENT WERE NOT INTIMATED TO THE ASSESSEE. THE ASSESSEE MADE A FRESH APPLICATION FOR SUPPLYING REASONS SO RECORDED FOR ISSUE OF NOTICE ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 4 UNDER SECTION 148 OF THE ACT. THE ASSESSEE FURTHER ALLEGED THAT THE ALLEGATION OF ASSESS ING OFFICER THAT THE ASSESSEE HAD DEPOSITED SUM OF RS.2,29,806/ - ON 31.03.2007 IN HSBC BANK SAVINGS ACCOUNT, WAS NOT CONSIDERED WHILE FILING THE RETURN OF INCOME, WAS VAGUE, AS DAY - TO - DAY TRANSACTIONS DO NOT APPEAR IN THE RETURN OF INCOME FILED. THE ASSES SEE CLAIMED THAT THE SAID RECEIPTS WERE PART OF ITS CONSULTANCY CHARGES AND HENCE, THE ASSESSING OFFICER HAD APPEARED TO HAVE ISSUED THE NOTICE UNDER SECTION 148 OF THE ACT TO VERIFY THE GENUINENESS OF SOURCES OF DEPOSITS, WHICH WAS NOT PERMISSIBLE IN LAW. THE CIT(A) NOTED THE CONTENTION OF ASSESSEE VIDE PARA 4.5 OF THE APPELLATE ORDER THAT THE NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED WITHIN TIME AND AFTER DUE APPROVAL OF JCIT. THE SECOND CONTENTION OF THE ASSESSEE WAS THAT REASONS WERE NOT COMMUNIC ATED TO HIM. THE CIT(A) IN THIS REGARD OBSERVED THAT THE PERUSAL OF ASSESSMENT ORDER REFLECTS THAT NO REASONS WERE EVER ASKED BY THE ASSESSEE FROM THE ASSESSING OFFICER AND FURTHER, THE ASSESSING OFFICER HAS ALSO DISCUSSED THE REASONS FOR REOPENING THE AS SESSMENT I.E. INFORMATION RECEIVED THROUGH AIR DATA, WHICH WAS NOT DISCUSSED BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT ORDER. THE CIT(A) THUS, OBSERVED THAT THE ASSESSEE WAS WELL AWARE OF THE REASONS FOR REOPENING OF THE ASSESSMENT AND FURTHER, THE ASSESSEE HAD FULLY COOPERATED DURING THE COURSE OF ASSESSMENT PROCEEDINGS BY APPEARING BEFORE THE ASSESSING OFFICER AND FILING THE SUBMISSIONS. ALSO, THE VALIDITY OF NOTICE, ETC. HAD NEVER BEEN CHALLENGED BEFORE THE ASSESSING OFFICER AND HENCE, THE AC TION OF ASSESSING OFFICER IN ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT WAS HELD TO BE IN ORDER. 8. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE REFERRED TO THE LETTER DATED 16 .04.2014 FILED ON 21.04.2014 UNDER WHICH, THE ASSESSEE SOUGHT TH E REASONS FOR REOPENING OF ASSESSMENT AFTER HE HAD GIVEN AN INTIMATION THAT ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 5 THE ORIGINAL RETURN OF INCOME FILED BY HIM SHOULD BE TREATED AS FILED IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE ACT . THEREAFTER, THE ASSESSEE POINTS OUT THAT REASONS WERE INT IMATED TO HIM AS PER ASSESSMENT ORDER AND REASONS WERE COMMUNICATED . ON 12.10.2015, THE EXTRACT OF REASONS WAS GIVEN, WHICH IS AFTER PASSING OF THE APPELLATE ORDER BY THE CIT(A) ON 09.10.2015, COPY OF WHICH IS PLACED AT PAGE 5 OF THE PAPER BOOK. THE ASSE SSEE FURTHER POINTS OUT THAT ANOTHER LETTER WAS MADE TO THE ASSESSING OFFICER ON 12.04.2016 TO GIVE EXACT REASONS FOR REOPENING THE ASSESSMENT UNDER SECTION 147 OF THE ACT AND VIDE LETTER DATED 02.05.2016, THE REASONS HAVE BEEN GIVEN, WHICH ARE AT VARIANCE FROM THE EXTRACT OF REASONS GIVEN TO THE ASSESSEE IN THE ASSESSMENT ORDER . THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE REFERRED TO THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. TREND ELECTRONICS (2015) 379 ITR 456 (BOM), WHER EIN IT HAS BEEN HELD THAT IN THE ABSENCE OF PROVIDING REASONS FOR REOPENING THE ASSESSMENT TO THE ASSESSEE WITHIN STIPULATED TIME, THE ASSESSMENT FRAMED UNDER SECTION 143(3) R.W.S. 147 OF THE ACT IS INVALID. 9. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDER OF CIT(A). 10. ON PERUSAL OF RECORD, THE PRELIMINARY ISSUE ARISING IN THE PRESENT APPEAL IS IN RELATION TO INITIATION OF RE - ASSESSMENT PROCEEDINGS UNDER SECTION 147/148 OF THE ACT. THE ASSESSING OFFICER AFTER RECE IVING CERTAIN INFORMATION THROUGH AIR DATA, RECORDED REASONS FOR REOPENING THE ASSESSMENT AND RECEIVED NECESSARY APPROVAL FROM JCIT UNDER SECTION 151(2) OF THE ACT AND ISSUED NOTICE UNDER SECTION 148 OF THE ACT. IN COMPLIANCE, THE ASSESSEE FILED A LETTER DATED 21.04.2014 STATING THAT ORIGINAL RETURN OF INCOME FILED UNDER SECTION ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 6 139(1) OF THE ACT BE TREATED AS RETURN OF INCOME FILED IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE ACT. THEREAFTER, VIDE SAME LETTER DATED 21.04.2014, THE ASSESSEE ASKED THE AS SESSING OFFICER TO FURNISH REASONS FOR REOPENING THE ASSESSMENT UNDER SECTION 147/148 OF THE ACT. THE REQUIREMENT OF THE ACT IS THAT WHERE RE - ASSESSMENT PROCEEDINGS ARE INITIATED AGAINST ANY ASSESSEE, THEN PURSUANT TO THE ASSESSEE HAVING FURNISHED THE RET URN OF INCOME, IS ENTITLED TO GET COPY OF REASONS RECORDED FOR REOPENING THE ASSESSMENT UNDER SECTION 147 OF THE ACT. ADMITTEDLY, THE ASSESSING OFFICER HAD RECORDED THE REASONS FOR REOPENING THE ASSESSMENT UNDER SECTION 147 OF THE ACT, COPY OF WHICH HAS B EEN RECEIVED BY THE ASSESSEE ON 02.05.2016 I.E. AFTER PASSING OF THE ASSESSMENT AND THE APPELLATE ORDERS. THE EXACT REASONS FOR REOPENING THE ASSESSMENT ARE AS UNDER: - REASONS FOR REOPENING THE CASE OF SHRI PARVEZ DAMANIA A.Y. 2007 - 08 IN THIS CASE INFO RMATION IS RECEIVED FROM THE DIT(SYSTEMS) - SYSTEMS - II, NEW DELHI IN RESPECT OF AIR INFORMATION OF RS.2,29,806/ - IN RESPECT OF AMOUNTS RECEIVED FROM HONG KONG AND SHANGHAI BANKING CORPORATION LTD. RECEIVED FROM HONG KONG AND SHANGHAI BANKING CORPORATION LTD. IT IS SEEN THAT THE SAME IS NOT INCLUDED IN THE INCOME OF TH E ASSESSEE AND THEREFORE TO THIS EXTENT I AM SATISFIED THAT INCOME CHARGEABLE TO INCOME HAS ESCAPED INCOME. THEREFORE THIS IS A FIT CASE FOR ISSUE OF NOTICE U/S.148 OF THE IT ACT, IF DEEMED FIT. 11. THE PERUSAL OF ASSESSMENT ORDER REFLECTS THAT THE REAS ONS INTIMATED TO THE ASSESSEE INITIALLY WERE NOT EXACT COPY ; BUT AS MENTIONED IN THE ASSESSMENT ORDER, WHEREIN IT WAS STATED THAT THROUGH AIR DATA, THE ASSESSEE HAD DEPOSITED AN AMOUNT OF RS. 2,29,806/ - ON 31.03.2007 IN HSBC BANK ACCOUNT. HOWEVER, THE COPY OF EXACT REASONS RECORDED FOR REOPENING THE ASSESSMENT IS WITH REGARD TO AMOUNTS RECEIVED FROM HSBC BANK TOTALING RS. 2,29,806/ - . THE TWO ARE AT VARIANCE I.E. INITIAL COMMUNICATION TO THE ASSESSEE WAS WITH REGARD TO DEPOSITS IN THE SAID HSBC BANK ACCOUNT AND ON THE OTHER HAND, THE EXACT REASONS WERE ON ACCOUNT OF AMOUNT RECEIVED FROM HSBC BANK. IN SUCH ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 7 SCENARIO, WHERE CORRECT REASONS HAVE NOT BEEN PROVIDED TO THE ASSESSEE, THE QUESTION WHICH ARISES IS WHETHER RE - ASSESSMENT PROCEEDINGS COMPLETED AGAINST TH E ASSESSEE ARE VALIDLY COMPLETE. 12. THE ASSESSEE BY WAY OF ADDITIONAL GROUND OF APPEAL HAS CHALLENGED THE JURISDICTION OF ASSESSING OFFICER IN INITIATING PROCEEDINGS UNDER SECTION 147 OF THE ACT FOR LACK OF REASON TO BELIEVE OF ESCAPEMENT OF INCOME . 13. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON 29.03.2014. FURTHER, VIDE LETTER DATED 16 .04.2014, THE ASSESSEE FILED REPLY BEFORE THE ASSESSING OFFICER IN WHICH IT WAS POINTED OUT THAT HE HAD ORIGINALLY FILED RETURN OF INCOME FOR THE RELEVANT ASSESSMENT YEAR ON 22.02.2008 DECLARING TOTAL INCOME OF RS.8,08,450/ - AND THE ASSESSING OFFICER WAS REQUESTED TO TREAT THE SAME AS RETURN OF INCOME FILED IN RESPONSE TO NOTICE ISSUED UNDER SECTION 148 OF THE ACT. SECONDLY, THE ASSESSEE VIDE THE SAID LETTER ITSELF REQUESTED THE ASSESSING OFFICER TO GIVE REASONS OF ISSUING NOTICE UNDER SECTION 148 OF THE ACT. HE ASKED THE ASSESSING OFFICER TO GIVE THE REASONS IN WRITING AT AN EARLIEST OPPOR TUNITY , BUT NO SUCH REASONS WERE PROVIDED TO THE ASSESSEE, WHICH IS THE REQUIREMENT OF THE ACT. ON THE OTHER HAND, THE REASONS WERE QUOTED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER WHICH AS POINTED OUT WERE AT VARIANCE. IN THE ASSESSMENT ORDER, TH E ASSESSING OFFICER HAS QUESTIONED THE DEPOSITS IN HSBC BANK, WHEREAS THE REASONS RECORDED FOR REOPENING THE ASSESSMENT TALKS OF IDENTICAL AMOUNT HAVING BEEN RECEIVED FROM HSBC BANK. THE QUESTION WHICH ARISES IN THE PRESENT APPEAL IS WHERE THE COPY OF REA SONS RECORDED FOR REOPENING THE ASSESSMENT HAVE NOT BEEN PROVIDED TO THE ASSESSEE AT THE FIRST INSTANCE AND ALSO WHERE THERE IS A DEVIATION IN THE REASONS RECORDED AND ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 8 REASONS AS TAKEN NOTE OF BY THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT ORDER, CAN ANY ADDITION BE MADE IN THE HANDS OF ASSESSEE. 14. THE HONBLE BOMBAY HIGH COURT IN CIT VS. TREND ELECTRONICS (SUPRA) IN A CASE OF REASSESSMENT, WHEREIN AN OBJECTION WAS RAISED BY THE ASSESSEE HELD THAT RECORDING OF REASONS AND FURNISHING OF REASONS IS TO BE STRICTLY COMPLIED WITH. IT IS FURTHER HELD THAT RECORDED REASONS SHOULD BE FURNISHED TO THE ASSESSEE WHEN SOUGHT FOR SO AS TO ENABLE HIM TO OBJECT TO THE REASONS BEFORE THE ASSESSING OFFICER AND IN THE ABSENCE OF SAME, THEN THE ORDER OF REASSESSM ENT WAS BAD IN LAW. THE RELEVANT FINDINGS OF THE HONBLE BOMBAY HIGH COURT ARE AS UNDER: - HELD, DISMISSING THE APPEAL, THAT THE ORDER OF THE TRIBUNAL MERELY APPLIED THE DECISION OF THE SUPREME COURT IN GKN DRIVESHAFTS (INDIA) LTD. AND FOLLOWED THE DECISI ON OF THE COURT IN VIDESH SANCHAR NIGAM LTD IN HOLDING THAT AN ORDER PASSED IN REASSESSMENT PROCEEDINGS WAS BAD IN LAW IN THE ABSENCE OF REASONS RECORDED FOR ISSUING A REOPENING NOTICE UNDER SECTION 148 OF THE INCOME - TAX ACT, 1961, BEING FURNISHED TO THE A SSESSEE WHEN SOUGHT FOR. IT IS AXIOMATIC THAT THE POWER TO REOPEN A COMPLETED ASSESSMENT UNDER THE ACT IT IS AXIOMATIC THAT THE POWER TO REOPEN A COMPLETED ASSESSMENT UNDER THE ACT IS AN EXCEPTIONAL POWER AND WHENEVER THE REVENUE SEEKS TO EXERCISE SUCH POWER, IT MUST STRICTLY COMPLY WITH THE PRE - REQUISITE CONDITIONS, VIZ., RECORDING OF REASONS TO INDICATE THAT THE ASSESSING OFFICER HAD REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT WHICH WOULD WARRANT THE REOPENING OF AN ASSESSMENT. THESE RECORDED REASONS MUST BE FURNISHED TO THE ASSESSEE WHEN SOUGHT FOR SO AS TO ENABLE THE ASSESSEE TO OBJECT TO THE REASONS BEFORE THE ASSESSING OFFICER. THUS, IN THE ABSENCE OF REASONS BEING FURNISHED WHEN SOUGHT FOR WOULD MAKE AN ORDER OF REASSESSMENT BAD IN LAW. THE RECORDING OF REASONS AND FURNISHING OF THE REASONS HAS TO BE STRICTLY COMPLIED WITH AS IT IS A JURISDICTIONAL ISSUE. THIS REQUIREMENT IS SALUTARY AS IT NOT ONLY ENSURES REOPENING NOTICES ARE NOT LIGHTLY ISSUED BUT ALSO WHERE NOTICES HAVE BEEN ISSUED ON SOME MISUNDERSTANDING/MISCONCEPTION, THE ASSESSEE IS GIVEN AN OP PORTUNITY TO POINT OUT THAT THE REASONS TO BELIEVE AS RECORDED IN THE REASONS DO NOT WARRANT REOPENING BEFORE THE REASSESSMENT PROCEEDINGS ARE COMMENCED. THE ASSESSING OFFICER DISPOSES OF THESE OBJECTIONS AND IF SATISFIED WITH THE OBJECTIONS, THEN THE REOP ENING NOTICE UNDER SECTION 148 IS DROPPED OR WITHDRAWN OTHERWISE IT IS PROCEEDED WITH FURTHER. IN ISSUES SUCH AS THIS, I.E., WHERE THE JURISDICTIONAL ISSUE IS INVOLVED THIS MUST BE STRICTLY COMPLIED WITH BY THE AUTHORITY CONCERNED AND NO QUESTION OF KNOWLE DGE BEING ATTRIBUTED ON THE BASIS OF IMPLICATION CAN ARISE. THE STAND OF THE REVENUE COULD NOT BE APPRECIATED, THAT THE ASSESSEE HAD ASKED FOR REASONS RECORDED ONLY ONCE AND, THEREFORE, SEEKING TO JUSTIFY NON - FURNISHING OF REASONS. THE STATE IS EXPECTED TO ACT MORE RESPONSIBLY. ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 9 15. NOW, COMING TO THE FACTS OF THE PRESENT CASE, WHERE THE ASSESSMENT IN THE HANDS OF ASSESSEE WAS REOPENED AFTER RECORDING THE REASONS FOR REOPENING THE ASSESSMENT UNDER SECTION 147 OF THE ACT AND THEREAFTER, NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED REQUIRING THE ASSESSEE TO FURNISH RETURN OF INCOME AND WHERE THE ASSESSEE HAD FURNISHED THE SAID RETURN OF INCOME AND HAD THEN ASKED FOR REASONS RECORDED FOR REOPENING THE ASSESSMENT. THE ASSESSING OFFICER IN THE PRESENT CASE HA S FAILED TO PROVIDE THE COPY OF REASONS RECORDED FOR REOPENING OF THE ASSESSMENT TO THE ASSESSEE AND IN VIEW THEREOF, REMEDY AVAILABLE WITH THE ASSESSEE TO OBJECT TO THE REASONS RECORDED FOR REOPENING OF THE ASSESSMENT AND DUTY OF THE ASSESSING OFFICER TO DEAL WITH THE SAID O BJECTIONS COULD NOT BE TAKEN CARE OF. IN VIEW OF THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. TRENDS ELECTRONICS (SUPRA), THE RE - ASSESSMENT ORDER PASSED IN THE CASE OF ASSESSEE IS BAD IN LAW. EVEN OTHERWISE, THE ASS ESSING OFFICER HAD COMPLETED REASSESSMENT PROCEEDINGS AGAINST THE ASSESSEE ON THE BASIS THAT THE REASONS WERE RECORDED IN RESPECT OF DEPOSIT OF SUM OF RS.2,29,806/ - ON 31.03.2007 IN SAVINGS BANK ACCOUNT WITH HSBC BANK. THE ASSESSEE WAS ASKED TO EXPLAIN TH E SAME. HOWEVER, THE EXACT REASONS RECORDED FOR REOPENING THE ASSESSMENT ARE AT VARIANCE I.E. INFORMATION WAS RECEIVED FROM DIT(SYSTEMS) IN RESPECT OF RS.2,29,806/ - BEING RECEIVED FROM HSBC BANK. THE REASSESSMENT PROCEEDINGS WERE COMPLETED AGAINST THE AS SESSEE TO EXPLAIN THE DEPOSIT OF RS.2,29,806/ - ON 31.03.2007, WHEREAS AIR INFORMATION WAS IN RESPECT OF AMOUNT RECEIVED FROM HSBC BANK. ON THIS GROUND ALSO, REASSESSMENT PROCEEDINGS COMPLETED AGAINST THE ASSESSEE ARE BAD IN LAW AND INVALID. THE CIT(A) HA S RAISED THE ISSUE OF COMPLIANCE OF ASSESSEE TO REASSESSMENT PROCEEDINGS AND HENCE NO MERIT IN OBJECTIONS OF ASSESSEE. THE HONBLE HIGH COURT HAS HELD WE ALSO DO NOT APPRECIATE THE STAND OF THE REVENUE, THAT THE RESPONDENT - ASSESSEE HAD ASKED ITA NO. 201 /PN/20 1 6 PARVEZ CAVAS DAMANIA 10 FOR REASONS R ECORDED ONLY ONCE AND, THEREFORE, SEEKING TO JUSTIFY NON - FURNISHING OF REASONS. WE EXPECT THE STATE TO ACT MORE RESPONSIBLY. IN THE PRESENT CASE ALSO THE ASSESSEE HAD SOUGHT REASONS FOR REOPENING THE ASSESSMENT FROM ASSESSING OFFICER AND ONCE THE SAID RE ASONS ARE NOT GIVEN TO ASSESSEE, THE ASSESSING OFFICER LACKS JURISDICTION TO CONCLUDE THE REASSESSMENT PROCEEDINGS. CONSEQUENTLY, REASSESSMENT ORDER PASSED IN THE CASE IS CANCELLED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, ALLOWED. 1 6 . IN T HE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 8 TH DAY OF JU LY , 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / ; / PUNE ; DATED : 8 TH JU LY , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 2 , PUNE ; 4. / THE PR. CIT - 1 , PUNE ; 5. 6. , , , - / DR SMC , ITAT, PUNE; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE