KASTUR H .GADA, MUMBAI V. ITO 16(2)(4), MUMBAI

ITA 2798/MUM/2014

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0135 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 02-05-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 23-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV
• Keywords: Reopening of assessment; Bogus Share capital; Unexplained investment; Principle of natural justice; Opportunity of cross examination; Tangible material; Corroborative evidences; Accommodation entries
• Section: 143(3); 69; 148; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH, JUDICIAL MEMBER ITA NO.2801/MUM/2014, (A.Y. 2005-06) SMT. LEELA BHANJI GADA, FLAT NO.9, A-WING, GOOL MAHAL BUILDING, 2 ND FLOOR, SLATTER ROAD, GRANT ROAD(WEST), MUMBAI 400 007. PAN: AFOPG 0182Q ...... APPELLANT VS. THE ITO 16(2)(4), MUMBAI. ..... RESPONDENT ITA NO.2798/MUM/2014, (A.Y. 2005-06) SMT. KASTURI H. GADA, FLAT NO.1404, TOWER 1, CASA GRANDE CHSL, SENAPATI BAPAT MARG, LOWER PAREL, MUMBAI 400 013 PAN:AABPG 0030B ...... APPELLANT VS. THE ITO 16(2)(4), MUMBAI. ...... RESPONDENT APPELLANTS BY : SHRI AJAY SINGH RESPONDENT BY : SHRI RAJESH KUMAR YA DAV DATE OF HEARING : 21/12/2017 DATE OF PRONOUNCEMENT : /03/2017 2 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) ORDER PER G.S.PANNU,A.M: THE CAPTIONED APPEALS ARE FILED BY TWO DIFFERENT ASSESSEES BELONG TO THE SAME GROUP AND THEY PERTAINS TO ASSES SMENT YEAR 2005-06. SINCE COMMON ISSUES ARE INVOLVED, THEY HAV E BEEN CLUBBED AND HEARD TOGETHER AND A CONSOLIDATED ORDER IS BEING PASSED FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. ITA NO.2801/MUM/2014, IN THE CASE OF SMT. LEELA BHANJI GADA IS TAKEN AS THE LEAD APPEAL, WHICH IS D IRECTED AGAINST THE ORDER OF CIT(A)-27, MUMBAI DATED 27/01/2014, WH ICH IN TURN, ARISES OUT OF ORDER PASSED BY THE ASSESSING OFFIC ER UNDER SECTION 143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961 (I N SHORT THE ACT) DATED 25/03/2013. IN THIS APPEAL, THE GROUNDS RAIS ED BY THE ASSESSEE READ AS UNDER:- 1. VIOLATION OF PRINCIPLES OF NATURAL JUSTICE : 1.1 THE LEARNED CIT(A) ERRED IN NOT GIVING ANY FINDING AS REGARDS GROUND NOS. 1 & 2 BY OBSERVING THAT, GROUNDS ARE OF GENERAL IN NATURE WITHOUT APPRECIATING THAT, THE PRINCIPLE OF NATURAL JUSTICE WAS VIOLATED AND EVIDENCES WERE USED AGAINST THE ASSESSEE WITHOU T FURNISHING THE COPY, HENCE THE ORDER OF THE ASSESSING OFFICER CONF IRMED BY CIT(A) IS BAD IN LAW. 1.2 THE LEARNED CIT(A) ERRED IN CONFIRMING THA T THE ASSESSING OFFICER, WHO FAILED TO PROVIDE A COPY OF THE STATEMENTS OF M R. MUKESH CHOKSI ON THE BASIS OF WHICH ASSESSMENT WAS REOPENED AND FURT HER AN OPPORTUNITY OF CROSS EXAMINATION, IN SPITE OF A SPECIFIC REQUES T MADE BY THE APPELLANT IN THIS BEHALF. THEREFORE, THE ASSESSMENT ORDER DT. 25/03/2013 IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE, AND H ENCE, BAD IN LAW. 2. REOPENING IS BAD IN LAW: 3 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) 2.1 THE LEARNED CIT(A) ERRED IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER IN REOPENING THE ASSESSMENT U/S.147 OF THE ACT, WITHOUT APPRECIATING THE FACTS THAT THERE WAS NO ESCAPEMENT OF ASSESSMENT IN THE ASSESSEE'S CASE AS THE ORIGINAL RETURN WAS ACCE PTED U/S. 143(1) DTD. 26/10/2006. AND THERE IS NO NEW MATERIAL OR FACTS B ROUGHT ON RECORD, THUS REOPENING IS NOTHING BUT BASED ON CHANGE OF OP INION AND HENCE BAD IN LAW. 2.2 THE LEARNED CIT(A) FAILED TO APPRECIATE THA T THE ASSESSING OFFICER FAILED TO PROVIDE A COPY OF THE RECORDED REASONS TO THE APPELLANT ON THE BASIS OF WHICH THE ASSESSMENT WAS REOPENED EVEN TIL L THE COMPLETION OF ASSESSMENT. THEREFORE, THE ACTION OF THE ASSESSING OFFICER CONFIRMED BY THE CIT (A) IS CONTRARY TO LAW AND WELL ESTABLISHED PRINCIPLES OF NATURAL JUSTICE, AND HENCE, THE REOPENING OF ASSESSMENT IS BAD IN LAW. 2.3 THE LEARNED CIT(A) ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER AND FAILED TO APPRECIATE THE FACT THAT THE NOTICE U/S 148 DTD. 27/03/2012 WAS ISSUED ON THE BASIS OF THIRD PARTY'S STATEMENT RECORDED ON OATH IN THE SEARCH AND SEIZER ACTION U/S. 132 IN THE CASE OF M/S. MAHASAGAR SECURITIES PVT. LTD., HENCE THE REOPENING IS BAD IN LAW AND IS LIABLE TO BE QUASHED. 3. ADDITION UNDER SECTION 69 OF RS.43,43,282/- ON A LLEGED ACCOMMODATION ENTRIES : 3.1 THE LEARNED CIT(A) ERRED IN CONFIRMING ACTIO N OF THE ASSESSING OFFICER AND FAILED TO APPRECIATE THAT THE TRANSACTI ONS ENTERED INTO BY THE APPELLANT WERE ONLY OF RS.76,664/- AND WERE DULY SU PPORTED BY ALL SUPPORTING EVIDENCE, SHOWN IN BALANCE SHEET, HENCE ADDITION OF RS. 43,43,282/- MAY BE DELETED. 3.2 THE LEARNED CIT(A) ERRED IN TREATING RS.43,43,2 82/- AS THE UNEXPLAINED INVESTMENT OF THE APPELLANT WITHOUT BRI NGING ANY EVIDENCE TO SUPPORT OF THE SAME AND THE PROVISIONS OF SECTIO N 69 CANNOT BE APPLIED TO THE FACTS OF THE APPELLANT, BASED ON THE STATEMENT OF THIRD PARTY. 3.3 WITHOUT PREJUDICE TO ABOVE, THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE APPELLANT HAS .SHOWN SPECULATIO N PROFIT OF RS. 1,87,125/- AND PAID TAX THEREON HENCE ADDITION OF R S.43,43,282/- MAY BE DELETED. 3. AT THE TIME OF HEARING, THE RIVAL COUNSELS HAVE BEEN HEARD ONLY WITH RESPECT TO GROUND OF APPEAL NO.2 ABOVE, W HEREIN THE ACTION OF THE ASSESSING OFFICER TO INITIATE PROCEED INGS UNDER SECTION 4 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) 147/148 OF THE ACT HAS BEEN CHALLENGED. IN THIS BA CKGROUND, THE RIVAL COUNSELS HAVE BEEN HEARD AND THE RELEVANT MAT ERIAL PERUSED. 4. THE APPELLANT BEFORE US IS AN INDIVIDUAL, WHO FI LED A RETURN OF INCOME FOR ASSESSMENT YEAR 2005-06 ORIGINALLY ON 21 /12/2005 DECLARING A TOTAL INCOME OF RS.1,95,293/-, WHICH WA S PROCESSED UNDER SECTION 143(1) OF THE ACT ON 26/10/2006. THE REAFTER, THE ASSESSING OFFICER ISSUED A NOTICE UNDER SECTION 148 OF THE ACT ON 27/03/2012 REOPENING THE ASSESSMENT ON THE GROUND T HAT CERTAIN INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT. I N THE ENSURING ASSESSMENT FINALIZED UNDER SECTION 143(3) R.W.S. 14 7 OF THE ACT DATED 25/03/2013, AN ADDITION OF RS.46,12,826/- HAS BEEN MADE TO THE RETURNED INCOME ON ACCOUNT OF PROFIT ON ACCOUNT OF SALE TRANSACTIONS WITH M/S. MAHASAGAR SECURITIES PVT. LT D. TREATING IT AS ACCOMMODATION ENTRIES. IN SUCH AN ASSESSMENT THE CLAIM OF THE ASSESSING OFFICER IS THAT CONSEQUENT TO A SEARCH AC TION IN THE CASE OF SHARE BROKER M/S. MAHASAGAR SECURITIES PVT. LTD. AN D ITS GROUP CONCERNS, ASSESSEE WAS FOUND TO HAVE OBTAINED PROFI T OF RS.46,12,826/- ON ACCOUNT OF SHARE TRANSACTIONS WHI CH WERE NOT CARRIED OUT IN ACTUALITY, BUT WERE MERE ACCOMMODATI ON ENTRIES. THE SAID ADDITION HAS ALSO BEEN SUSTAINED BY THE CI T(A), AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE US. 5. BEFORE US, THE LD. REPRESENTATIVE FOR THE ASSESS EE HAS REFERRED TO THE REASONS RECORDED FOR REOPENING BY T HE ASSESSING OFFICER, WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGE -5, AND WHICH READ AS UNDER:- 5 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) THE ASSESSEE HAS OBTAINED ACCOMMODATED ENTRIES AMO UNTING TO RS,46,12,826/- FOR F.Y 2004-05 RELEVANT TO ASSESSME NT YEAR 2005-06 FOR M/S. GOLD STAR FINVEST SECURITIES PVT. LTD . ASSAILING THE VALIDITY OF THE REOPENING OF ASSESSME NT, THE LD. REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT TH E REASONS RECORDED WERE FACTUALLY INCORRECT, INASMUCH AS, AS SESSEE HAD NOT UNDERTAKEN ANY SHARE TRANSACTIONS THROUGH BROKER M/ S. GOLD STAR FINVEST SECURITIES PRIVATE LIMITED AND THAT EVEN TH E QUANTUM OF TRANSACTION REFLECTED IN THE REASONS RECORDED WAS W RONG, INASMUCH AS, THE TOTAL PURCHASES EFFECTED BY THE ASSESSEE W AS ONLY TO THE TUNE OF RS.1,44,405/- AND THAT TOO WERE NOT PURCHA SED THROUGH M/S. MAHASAGAR SECURITIES PVT. LTD. IN THIS CONTEX T, ATTENTION HAS ALSO BEEN DRAWN TO THE REPLY DATED 07/11/2012 FURNI SHED TO THE ASSESSING OFFICER, COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK. REFERENCE HAS ALSO BEEN MADE TO PAGE-47 OF T HE PAPER BOOK, WHEREIN IS PLACED THE DETAILS OF THE PURCHASES OF S HARES EFFECTED DURING THE YEAR WHICH AMOUNTS TO RS.1,44,405/-. TH E LD. REPRESENTATIVE FOR THE ASSESSEE HAS ALSO REFERRED T O THE RELEVANT ANNEXURE ATTACHED TO THE BALANCE SHEET, WHICH ALSO DEPICTS THE PURCHASE OF SHARES AMOUNTING TO RS.1,44,405/-. THE LD. REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT IN THE ASSESSMENT ORDER NO ADDITIONS HAVE BEEN MADE BASED ON THE REAS ONS RECORDED, INASMUCH AS, IN THE ASSESSMENT ORDER THE ADDITION I S WITH RESPECT TO THE TRANSACTION WITH M/S. MAHASAGAR SECURITIES PVT. LTD., WHEREAS IN THE REASONS RECORDED IT IS STATED THAT ASSESSEE HAD UNDERTAKEN ACCOMMODATION ENTRIES WITH M/S. GOLD STAN FINVEST P VT. LTD. IN THIS MANNER, THE LD. REPRESENTATIVE FOR THE ASSESSEE HAS SET UP A CASE 6 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) THAT THE REASONS HAS BEEN RECORDED BY THE ASSESSING OFFICER WITHOUT PROPER APPLICATION OF MIND AND AS THEY ARE FACTUAL LY INCORRECT, THE REOPENING IS BAD IN LAW. ACCORDING TO THE LD. REPR ESENTATIVE FOR THE ASSESSEE THE FACTS STATED IN THE REASONS RECORDED BEING FACTUALLY INCORRECT AND, THEREFORE, THE SAME WOULD NOT CONSTI TUTE APPROPRIATE NEXUS WITH FORMATION OF BELIEF ABOUT ESCAPEMENT OF INCOME, AND, HENCE THE PROCEEDINGS INITIATED UNDER SECTION 147 /148 OF THE ACT ARE INVALID. THE LD. REPRESENTATIVE FOR THE ASSESS EE HAS ALSO RELIED UPON THE DECISION OF THE TRIBUNAL IN THE CASE OF AN OTHER GROUP ASSESSEE, SHRI HARAKCHAND K. GADA(HUF), IN ITA NO.2 800/MUM/2014 DATED 09/12/2015, WHEREIN ALSO IN SIMILAR SITUATION , THE REOPENING WAS HELD AS BAD IN LAW. RELIANCE HAS ALSO BEEN PLA CED ON THE DECISION OF THE CO-ORDINATE BENCH IN THE CASE OF AN OTHER GROUP ASSESSEE SMT. RASILA N. GADA IN ITA NO.2802/MUM/20 14 DATED 31/05/2016, WHEREIN ALSO INCORRECT FACTS WERE RECOR DED IN THE REASONS FOR REOPENING AND THE TRIBUNAL HELD THAT T HE INITIATION OF PROCEEDINGS UNDER SECTION 147/148 OF THE ACT TO BE BAD IN LAW. IN FACT, BY REFERRING TO THE RELEVANT DISCUSSION IN TH E ORDER OF THE TRIBUNAL IN THE CASE OF SHRI HARAKCHAND K. GADA(HUF ) (SUPRA) IT WAS POINTED OUT THAT THE REASONS RECORDED THEREIN ARE S IMILARLY WORDED AS ARE IN THE PRESENT CASE. APART THERE-FROM, THE LD. REPRESENTATIVE FOR THE ASSESSEE HAS ALSO RELIED UPON THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF PCIT VS. MEENAKSHI OVERSEAS PVT. LTD., 395 ITR 677(DELHI) TO POINT OUT THAT WHERE TH ERE WAS AN ABSENCE OF LINK BETWEEN TANGIBLE MATERIAL AND FORM ATION OF BELIEF 7 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) OF ESCAPEMENT OF INCOME, THE INITIATION OF PROCEE DINGS UNDER SECTION 147/148 OF THE ACT IS UNTENABLE IN LAW. 6. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE HAS NOT CONTESTED THE FACTUAL MATRIX BROUGHT OUT BY THE LD. REPRESENTATIVE FOR THE ASSESSEE BUT RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND CONTENDED THAT THE REOPENING WAS BASED ON THE I NFORMATION RECEIVED DDIT (INV.) UNITY 1(4), MUMBAI AS A RESULT OF SEARCH CARRIED OUT IN THE CASE OF SHARE BROKER M/S. MAHASAGAR SEC URITIES PVT. LTD. AND ITS GROUP CONCERNS, WHICH WERE FOUND TO BE ENGA GED IN THE BUSINESS OF ISSUING BOGUS BILLS FOR PROVIDING LON G TERM CAPITAL GAINS/LOSS, SPECULATION PROFIT OR LOSS, BOGUS SALES BILLS AND ALSO ENGAGED IN PROVIDING BOGUS SHARE APPLICATION MONEY TO OTHER INDIVIDUAL ASSESSEES IN RETURN FOR CASH. THE LD. D EPARTMENTAL REPRESENTATIVE FAIRLY SUBMITTED THAT EVEN THOUGH TH ERE WAS SOME VARIATION IN THE REASONS RECORDED BY THE ASSESSING OFFICER AND THE ULTIMATE ASSESSMENT, YET THAT CANNOT BE THE GROUND TO QUASH THE RE- ASSESSMENT PROCEEDINGS SINCE ASSESSEE HAD DULY PART ICIPATED IN THE ASSESSMENT PROCEEDINGS. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. OSTENSIBLY, THE DISCUSSION IN THE ASSESSMENT ORDER REVEALS THAT THE REOPENING UNDER SECTION 147/148 OF THE ACT HAS BEEN INITIATED IN THE PRESENT CASE AS A CONSEQUENCE OF SEARCH IN THE CASE OF SHARE BROKER M/S. MAHASAGAR SECURITIES PVT. LTD. AND ITS GROUP CONCERNS, WHOSE MAIN PERSON WAS ONE SHRI MUKESH CHOKSI. THE REASONS RECORDED FOR REOPENING HAVE ALREADY BEEN REPRODUCE D BY US IN THE 8 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) EARLIER PART OF THIS ORDER. THE AFORESAID REASONS WERE MADE AVAILABLE TO THE ASSESSEE BY THE ASSESSING OFFICER VIDE A COMMUNICATION DATED 04/10/2012, A COPY OF WHICH IS PLACED AT PAGE 5 OF THE PAPER BOOK. THE REASONS BRINGS OUT A CHARGE AGAINST THE ASSESSEE, WHICH IS TO THE EFFECT THAT ASSESSEE HAS OBTAINED ACCOMMODATION ENTRIES AMOUNTING TO RS.46,12,826/- I N THE INSTANT ASSESSMENT YEAR FROM M/S. GOLD STAR FINVEST SECURIT IES PVT. LTD. OSTENSIBLY, ON A PERUSAL OF THE REASONS RECORDED AN D THE CONSEQUENT ASSESSMENT ORDER, IT CLEARLY TRANSPIRES THAT THERE IS A VARIATION IN THE FACTS NOTED BY THE ASSESSING OFFIC ER. WHEREAS IN THE REASONS RECORDED, ASSESSEE IS STATED TO HAVE UNDERT AKEN TRANSACTIONS WITH M/S. GOLD STAR FINVEST SECURITIES PVT. LTD. WHILE IN THE ASSESSMENT ORDER, IT IS STATED THAT THE TRANSAC TIONS HAVE BEEN CARRIED OUT THROUGH M/S. MAHASAGAR SECURITIES PVT. LTD. NOTABLY, IN THE REASONS RECORDED AS WELL AS IN THE ASSESSMENT O RDER, THE ASSESSING OFFICER HAS NOT TABULATED THE TRANSACTION S WHICH ARE REFLECTED BY THE AMOUNT OF RS.46,12,826/-. THE ASS ESSEE HAS VEHEMENTLY BROUGHT OUT ON THE BASIS OF THE MATERIAL ON RECORD THAT IN THE INSTANT YEAR NO TRANSACTION AMOUNTING TO R S.46,12,826/- HAS BEEN ENTERED INTO. FOR THAT MATTER, THE DETAILS AN NEXED TO THE BALANCE SHEET, WHICH IS PLACED AT PAGE-3 OF THE PAP ER BOOK, HAS BEEN REFERRED TO, WHICH ONLY REFLECTS PURCHASE OF S HARES OF MARUTI INFRA LTD. TOTALLING TO RS.1,44,405/-. AT PAGE 47 OF THE PAPER BOOK IS PLACED THE DETAILS OF PURCHASES EFFECTED BY THE ASSESSEE DURING THE YEAR THROUGH M/S. MAHASAGAR SECURITIES PVT. LTD ., WHICH IS TO THE TUNE OF RS.1,44,405/-. FURTHER, THE LD. REPRES ENTATIVE FOR THE 9 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) ASSESSEE POINTED THAT DURING THE YEAR INTRADAY SPEC ULATION TRANSACTIONS WERE ALSO UNDERTAKEN BY THE ASSESSEE T HROUGH A BROKER M/S. NAMAN SECURITIES, WHICH IS NOT A PART OF M/S. MAHASAGAR SECURITIES PVT. LTD. GROUP OF CONCERNS, AND, EVEN IF, THE VALUE OF SUCH TRANSACTIONS ARE ADDED, YET IT WOULD NOT AMOUN T TO RS.46,26,826/- AS IS SOUGHT TO BE MADE OUT BY THE A SSESSING OFFICER. ALL THESE FACTUAL ASPECTS CLEARLY BRINGS OUT THAT T HE ASSESSING OFFICER WHILE RECORDING REASONS HAS FAILED TO APPLY HIS MIN D AND HAS MERELY REFERRED TO THE REPORT OF THE INVESTIGATION WING. THE LEAST THAT WAS REQUIRED BY THE ASSESSING OFFICER WAS TO ESTABLISH A LINK BETWEEN THE INFORMATION MADE AVAILABLE BY THE INVESTIGATION WING AND THE FORMATION OF HIS BELIEF ON ESCAPEMENT OF INCOME, W HICH IS CLEARLY ABSENT IN THE PRESENT CASE. THE ASSESSING OFFICER RECORDS ACCOMMODATION ENTRIES ARE PURPORTED TO HAVE BEEN EN TERED THROUGH M/S. GOLD STAR FINVEST SECURITIES P. LTD., WHICH IS ADMITTEDLY WRONG. FURTHER, IN THE REASONS RECORDED THERE IS N O DETAILS OF THE TRANSACTION AND A BALD REFERENCE TO ENTRIES AMOUNTING TO RS.46,12,826/ - HAS BEEN MADE. EVEN WHEN THE ASSESSEE POINTED OUT TO THE ASSESSING OFFICER IN ITS REPLY DATED 7/1 1/2012, ABOUT THE INCORRECTNESS OF THE PURCHASES STATED AT RS.46,12,8 26/- AS AGAINST ACTUAL PURCHASE OF RS.1,44,405/-, NO CREDIBLE NEGAT ION HAS BEEN BROUGHT OUT BY THE ASSESSING OFFICER. THIS CLEARLY IMPLIES THAT AT THE TIME OF RECORDING OF REASONS EVEN THE MINIMUM REQUI RED APPLICATION OF MIND WAS ABSENT, WHICH OBLIGATED THE ASSESSING OFFICER TO ESTABLISH A CRUCIAL LINK BETWEEN THE INF ORMATION MADE AVAILABLE TO HIM AND HIS BELIEF ABOUT ESCAPEMENT OF INCOME. 10 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) THEREFORE, IN OUR VIEW, THE INITIATION OF REASSESSM ENT PROCEEDINGS UNDER SECTION 147/148 OF THE ACT IN THE PRESENT CA SE IS WITHOUT APPLICATION OF APPROPRIATE MIND AND, THUS, UNTENABL E IN LAW. IN COMING TO SUCH CONCLUSION, WE HAVE ALSO PERUSED THE DECISION OF THE CO-ORDINATE BENCHES IN THE CASE OF SHRI HARAKCH AND K. GADA(HUF)(SUPRA) AND SMT. RASILA N. GADA(SUPRA), WHEREIN ALSO ON SIMILAR DISCREPANCIES/INFIRMITIES, THE INITIATION O F PROCEEDINGS UNDER SECTION 147/148 HAVE BEEN FOUND TO BE INVALID. THE RATIO LAID DOWN IN THE AFORESAID TWO DECISIONS IS3 CLEARLY APPLICAB LE IN THE PRESENT CASE AND, THEREFORE, IN VIEW OF THE AFORESAID DISCU SSION AND HAVING REGARD TO THE DECISION OF THE CO-ORDINATE BENCHES A S REFERRED ABOVE, WE HOLD THAT THE REOPENING OF ASSESSMENT UND ER SECTION 147/148 OF THE ACT IS INVALID IN THE EYES OF LAW. AS A CONSEQUENCE, THE IMPUGNED ASSESSMENT ORDER IS LIABLE TO BE QUASH ED. WE HOLD SO. IN THE RESULT, GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS ALLOWED. 7.1 AS WE HAVE DECIDED THE ISSUE OF REOPENING OF AS SESSMENT IN FAVOUR OF THE ASSESSEE AND ASSESSMENT ORDER HAS BEE N QUASHED, THE NECESSITY TO DEAL WITH OTHER GROUNDS RAISED IN THE APPEAL ARE OBVIATED SINCE THEY ARE RENDERED ACADEMIC. 7.2 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS A LLOWED. ITA NO.2798/MUM/2014: 8. AT THE TIME OF HEARING, IT WAS A COMMON POINT B ETWEEN THE PARTIES THAT SO FAR AS APPEAL IN ITA NO.2798/MUM/2 014 IN THE CASE OF SMT. KASTURI H. GADA IS CONCERNED, THE ISSUE R AISED IS SIMILAR TO 11 ITA NO.2801&2798/MUM/2014, (A.Y. 2005-06) THE GROUNDS OF APPEAL DEALT WITH BY US IN ITA NO .2801/MUM/2014 IN THE CASE OF SMT. LEELA BHANJI GADA. AS A CONSEQ UENCE, OUR DECISION IN ITA NO.2801/MUM/2014 IN THE CASE OF SM T. LEELA BHANJI GADA SHALL APPLY MUTATIS MUTANDIS IN THE APPEAL FOR ASSESSMENT YEAR 2006-07 ALSO. 9. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED, AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 09/03/2018 . SD/- SD/- (AMARJIT SINGH) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 09/03/2018 VM , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI