SHRI TARLOCHAN SINGH, MANSA V. INCOME TAX OFFICER WARD-1(4), MANSA

ITA 306/ASR/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1251 (ITAT-AMRITSAR)
• Duration Of Justice: 2 year(s) 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 03-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K S BAINS
• Keywords: Reopening of assessment; Capital asset; Principle of natural justice; Additional evidence; Question of law; Reasonable cause; Fair market value; Valuation report; Competent authority; Reason to believe; Reassessment proceedings; Capital Gains
• Section: 143(3); 64; 113; 48; 13; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, AMRITSAR (VIRTUAL COURT) BEFORE: SHRI. N.K.SAINI, VICE PRESIDENT AND SHRI R.L. NEGI, JUDICIAL MEMBER ITA NO. 306/ASR/2019 ASSESSMENT YEAR: 2012-13 SHRI TRALOCHAN SINGH C/O G.S. CHAHAL & ASSOCIATES, BACKSIDE GAUSHALA, MANSA THE ITO WARD-1(4) MANSA ./ PAN NO. DNDPS2922G / APPELLANT / RESPONDENT ITA NO. 307/ASR/2019 ASSESSMENT YEAR: 2012-13 SHRI NAROTAM SINGH C/O G.S. CHAHAL & ASSOCIATES, BACKSIDE GAUSHALA, MANSA THE ITO WARD-1(4), MANSA ./ PAN NO. CLEPS7008F / APPELLANT / RESPONDENT / ASSESSEE BY : SHRI TEJMOHAN SINGH, ADVOCATE / REVENUE BY : K.S. BAINS, CIT DR #/ DATE OF HEARING : 24/06/2021 #/ DATE OF PRONOUNCEMENT : 30/06/2021 / // / ORDER PER N.K. SAINI, VICE PRESIDENT THESE TWO APPEALS BY THE ASSESSEES ARE DIRECTED AGAIN ST THE SEPARATE ORDERS EACH DATED 26/02/2019 OF THE LD. CIT(A), BATHINDA. 2. SINCE THE ISSUES INVOLVED ARE COMMON AND THE APPEALS WERE HEARD TOGETHER SO THESE ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2 3. AT THE FIRST INSTANCE WE WILL DEAL WITH THE APPEAL I N ITA NO. 306/ASR/2019 IN CASE OF SHRI TRALOCHAN SINGH VS. ITO, WARD1(4), MANSA. 4. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: 1. THE LD. CIT(A) ERRED ON FACTS & LAW IN CONFIRMING T HE ACTION OF THE AO OF ASSESSING THE INCOME AT RS.3,87,73,310/- + AGRICULT URE INCOME AT RS. 11,56,169/- VIDE ORDER U/S 143(3)1147 DATED 20.12.2017. 2. THE LD. CIT(A) ERRED ON FACTS & LAW IN CONFIRMING T HE VALIDITY OF THE PROCEEDINGS U/S 1471148 BECAUSE THE JOINT COMMISSIO NER OF INCOME TAX DID NOT RECORD THE SATISFACTION ON THE REASONS RECORDED BY THE AO, AS PRESCRIBED U/S 151, THAT THE CASE OF THE ASSESSEE WAS FIT FOR ISSUE OF NOTICE U/S 148. 3. THE LD. CIT(A) ERRED ON FACTS S LAW IN CONFIRMING THE VALIDITY OF THE PROCEEDINGS U/S 1471148 BECAUSE THE OWNERSHIP OF LA ND INTRODUCED AS CAPITAL IN THE FIRM WAS ANCESTRAL BELONGING TO THE HUF WHILE T HE REASONS HAVE BEEN RECORDED U/S 147 & NOTICE U/S 148 HAS BEEN ISSUED IN THE STATUS OF IND IVIDUAL. 4. THE LD. CIT(A) ERRED ON FACTS & LAW IN CONFIRMING T HE VALIDITY OF THE PROCEEDINGS U/S 147/148 BECAUSE THE REASONS RECORDE D BY THE AO TO INITIATE THE PROCEEDINGS ARE REASONS TO SUSPECT & NOT REASONS TO BELIEVE AND FURTHER, THERE IS NO REASON TO BELIEVE THAT INCOME OF THE ASSESSEE HA S ESCAPED ASSESSMENT. 5. THE LD. CIT(A) ERRED ON FACTS & LAW IN ASSESSING TH E LONG TERM CAPITAL GAINS BY INVOKING THE PROVISION OF SECTION 45(3) OF THE INCOME TAX ACT, 1961 BECAUSE NO REAL INCOME AROSE/RECEIVED OR ACCRUED TO THE ASSESSEE ON ACCOUNT OF TRANSFER OF LAND AS CAPITAL CONTRIBUTION TO THE PARTNERSHIP FIRM. 6. THE LD. CIT(A) ERRED ON FACTS & LAW IN CONFIRMING T HE ACTION OF THE AO IN ASSESSING THE LONG TERM CAPITAL GAINS BY INVOKING T HE PROVISION OF SECTION 45(3) OF THE INCOME TAX ACT, 1961 BECAUSE IT IS A DEEMING PR OVISION WHICH CREATES FICTION ONLY TO FIX THE YEAR OF TRANSFER AND CONSIDERATION ON TRANSFER BUT THERE IS NO FICTION REGARDING ACCRUAL OF PROFITS AND GAINS ON TRANSFER OF CAPITAL ASSET. 7. THE LD. CIT(A) ERRED ON FACTS & LAW IN ASSESSING TH E LONG TERM CAPITAL GAINS BY INVOKING THE PROVISION OF SECTION 45(3) OF THE INCOME TAX ACT, 1961 BECAUSE NO REGISTERED SALE DEED WAS EXECUTED TO TRA NSFER THE LAND TO THE PARTNERSHIP AS CAPITAL CONTRIBUTION ET IT IS SETTLE D PRINCIPLE OF LAW THAT NO IMMOVABLE PROPERTY CAN BE TRANSFERRED WITHOUT EXECU TION ET REGISTRATION OF A REGISTERED SALE DEED. 8. THAT THE ADOPTION BY THE LD. CIT(A) OF THE VALUE OF THE LAND AS ON 01.04.1981 IS AGAINST THE FACTS & CIRCUMSTANCES OF THE CASE & IS VERY MUCH ON THE LOWER SIDE. 9. NOTWITHSTANDING THE AFORESAID GROUNDS OF APPEAL, TH E LD. CIT(A) SHOULD HAVE ADOPTED THE 'FAIR MARKET VALUE' OF THE LAND TH EN THE 'REGISTERED VALUE' AS THE FAIR MARKET VALUE CANNOT BE A REGISTERED VALUE. 3 10. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR DISPOSED OFF. VIDE GROUND NO. 2 THE ASSESSEE HAS CHALLENGED THE VALIDI TY OF THE PROCEEDINGS UNDER SECTION 147 R.W.S 148 OF THE INCOME TAX ACT, 1961 (HERE INAFTER REFERRED TO AS ACT) AND THE SATISFACTION RECORDED BY THE LD. JCIT UNDER SECTION 151 OF THE ACT. 5. FACTS OF THE CASE IN BRIEF ARE THAT THE A.O. INITIAT ED THE PROCEEDINGS UNDER SECTION 147 R.W.S 148 OF THE ACT ON THE BASIS THAT THE ASSESSEE HAD INTRODUCED CAPITAL IN THE FIRM M/S G.S. CHAHAL & ASSOCIATES BY WAY OF TRANSF ER OF HIS ANCESTRAL LAND MEASURING 46 KANALS 15 MARLA FOR RS. 4,09,06,250/- AND THAT THE ENTIRE LAND TRANSFERRED TO THE FIRM WAS SITUATED IN THE MUNICIPAL LIMIT OF MANSA. HENCE THE ENTIRE LAND WAS CAPITAL ASSET. THE A.O. MENTIONED IN THE ASSESSMENT ORDER DT. 20/ 12/2017 THAT THE PROCEEDINGS WERE INITIATED AFTER TAKING PRIOR APPROVAL OF THE JC IT, RANGE-I, BATHINDA. 5.1 THE ASSESSEE RAISED THE OBJECTIONS BEFORE THE A.O. FOR ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT AS UNDER: 'I HAVE TO VERY HUMBLY SUBMIT THAT THE NOTICE U/S 1 48 HAS BEEN ISSUED AND THE COPY OF LIVE REASONS TO ISSUE NOTICE U/S 148 HAS BE EN PROVIDED. THE OBJECTIONS AGAINST THE SAME FOR WHICH THE ASSESSEE IS ENTITLED AS PER THE BINDING PRECEDENT OF THE APEX COURT IN THE CASE OF GKN DRIVESHAFTS (I NDIA) LTD. V. ITO(2002) 125 TAXMAN 963 (SC) ARE AS UNDER BECAUSE THE RETURN OF INCOME IN RESPECT TO NOTICE U/S 148 HAS ALREADY BEEN FILED:- (I) THE NOTICE U/S 148 HAS NOT BEEN SERVED IN ACCOR DANCE WITH THE PROVISIONS OF SECTION 282 OF THE INCOME TAX ACT, 1961. (II) THE SATISFACTION OF THE JOINT COMMISSIONER OF INCOME TAX ON THE REASONS RECORDED WHICH IS MANDATORY IN ACCORDANCE WITH THE PROVISIONS OF SECTION 151(2), HAS NOT BEEN RECORDED IN ACCORDANCE WITH TH E PROCEDURE LAID DOWN UNDER THE ACT. (III) THE PROVISIONS OF SECTION 45(3) ARE ALSO NOT APPLICABLE BECAUSE IT IS ONLY A DEEMING PROVISION WHICH CREATES FICTION ONLY TO F IX THE, YEAR OF TRANSFER AND CONSIDERATION ON TRANSFER BUT THERE IS NO FICTION R EGARDING ACCRUAL OF PROFITS AND GAINS ON TRANSFER OF CAPITAL GAIN, (IV) IT HAS BEEN CATEGORICALLY STATED IN THE REA SONS FOR INITIATING THE REASSESSMENT PROCEEDINGS THAT THE CAPITAL WAS INTRODUCED BY WAY OF TRANSFER OF ANCESTRAL LAND BUT THE STATUS HAS BEEN MENTIONED AS INDIVIDUAL. 4 IN VIEW OF THE ABOVE STATED FACTS, THE PROCEEDINGS INITIATED U/S 147 ARE VOID-AB- INITIO AND THE NOTICE U/S 147 MAY KINDLY BE VACATED . IT IS ALSO PRAYED THAT THE ASSESSMENT PROCEEDINGS MAY KINDLY BE KEPT PENDING T ILL THE OBJECTIONS ARE DEALT.' 5.2 HOWEVER, THE A.O. HAD NOT ACCEPTED THE SUBMISSIONS O F THE ASSESSEE FOR THE FOLLOWING REASONS: (I) THE PLEA REGARDING NON-SERVICE OF NOTICE U/S 1 48 IN ACCORDANCE WITH THE PROVISIONS OF SECTION 282 OF I. T. ACT,L961 IS NOT ACCEPTABLE. AS PER PROVISIONS OF SECTION 282 OF I, T. ACT, 1961, THE SERVICE OF NOTI CE OR SUMMON OR REQUISITION OR ORDER OR ANY OTHER COMMUNICATION UNDER THIS ACT MAY BE MADE BY DELIVERING OR TRANSMITTING A COPY THEREOF, TO THE PERSONS THEREIN NAMED (A) BY POST OR BY SUCH COURIER SERVICES AS MAY BE APPRO VED BY THE BOARD; OR (B) IN SUCH MANNER AS PROVIDED UNDER THE CODE OF CIVIL PROCEDURE, 1908 (5 OF 1908) FOR TITLE PURPOSES OF SERVICE OF SUMMONS; OR (C) IN THE FORM OF ANY ELECTRONIC RECORD AS PROVIDED IN CHAPTER VI OF THE INFORMATION TECHNOLOGY ACT, 2000 (21 OF 2000); OR (D) BY ANY OTHER MEANS OF TRANSMISSION OF DOCUMENTS AS PROVIDED BY RULES MADE BY THE BOARD IN THIS BEHALF. THE ABOVE SAID NOTICE WAS SERVED THROUGH THE NOTICE SERVER OF THE DEPARTMENT WHICH IS ONE OF THE MEAN OF TRANSMISSION OF DOCUMEN TS AS PROVIDED BY THE RULES MADE BY THE BOARD. II. THE NECESSARY SATISFACTION HAS ALSO BEEN RECORD ED BY THE JOINT COMMISSIONER OF INCOME-TAX, RANGE-I, BATHINDA IN AC CORDANCE WITH THE PROVISIONS OF SECTION 151(2) OF I. T. ACT, 1961. TH IS PLEA IS ALSO NOT HELPFUL TO THE ASSESSEE. III. THE PLEA THAT PROVISIONS U/S 45(3) IS NOT APPL ICABLE TO THE CASE OF THE ASSESSEE IS ALSO NOT ACCEPTABLE. THE ASSESSEE HAS B ECOME A PARTNER IN THE FIRM DEALING WITH REAL ESTATE AND INTRODUCED CAPITAL BY WAY OF TRANSFER OF HIS LAND. IT IS NOT ONLY A FICTION TO THE FIX THE YEAR OF TRANSFER AS THE LAND WAS ACTUALLY TRANSFERRED TO THE FIRM AS HIS CAPITAL. IT IS STATED AS IF THE LAND WAS NOT TRANSFERRED THEN BECOMING A PARTNER, THE ASSESSEE SHOULD HAVE MONEY. IN THIS CASE, THE ASSESSEE HAS TRANSFER OF HIS LAND INSTEAD OF INTRODUCTION OF CAPITAL BY CASH OR OTHERWISE. THEREFORE, THERE WAS NO FICTION BUT THE LAND WAS AC TUALLY TRANSFERRED TO THE FIRM. AS PER PROVISIONS OF SECTION 48, THE AMOUNT RECORDED I N THE BOOKS OF ACCOUNT OF THE FIRM, AS THE VALUE OF THE CAPITAL ASSET SHALL BE DE EMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF T HE TRANSFER OF THE CAPITAL ASSET. IV. THE PLEA REGARDING ANCESTRAL LAND TAKEN IN INDI VIDUAL STATUS IS NOT ACCEPTABLE ALTHOUGH THE LAND WAS ANCESTRAL YET THE ASSESSEE HAS BECOME A PARTNER IN THE FIRM IN THE CAPACITY OF INDIVIDUAL A ND NOT IN HUF CAPACITY. THUS, THIS PLEA IS ALSO NOT ACCEPTABLE. 5.3 THE A.O. FRAMED THE ASSESSMENT BY MAKING THE ADDITIO N OF RS. 3,87,03,600/- ON ACCOUNT OF LONG TERM CAPITAL GAIN. 5 6. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER T O THE LD. CIT(A) AND CHALLENGED THE VALIDITY OF THE REASSESSMENT PROCEEDINGS. THE ASSESSEE FURNISHED THE WRITTEN SUBMISSION WHICH HAD BEEN INCORPORATED BY THE L D. CIT(A) IN PARA 4.1 OF THE IMPUGNED ORDER AND READ AS UNDER: IN THE ABOVE STATED GROUNDS OF APPEAL THE ASSESSEE HAS CHALLENGED THE VALIDITY OF PROCEEDINGS U/S 147/148 & THE SUBMISSIONS OF THE ASSESSEE ARE AS UNDER;- (I) THE NOTICE U/S 148 WAS NOT SERVED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 282. (II) THE REASONS TO BELIEVE RECORDED BY THE AO ARE I N FACT REASONS TO SUSPECT (III) THE PROCEEDINGS U/S 147/148 HAVE BEEN CHAL LENGED BECAUSE THE JCIT FAILED TO RECORD SATISFACTION IN ACCORDANCE WITH THE PROCE DURE LAID DOWN U/S 151(2) THAT THE CASE OF THE ASSESSEE WAS FIT FOR ISSUE OF NOTICE U/S 148. THE AO HAS HIMSELF ACCEPTED THE FACT IN THE ASSESSME NT ORDER THAT 'THEREFORE, TO ASSESS THE INTEREST INCOME, PROCEEDI NGS U/S 147 OF IT. ACT, 1961 WERE INITIATED BY ISSUE OF NOTICE U/S 148 OF IT. ACT, 19 61 DATED 20.03.2017 AFTER TAKING PRIOR APPROVAL OF THE WORTHY JOINT COMMISSIONER OF INCOME-TAX, RANGE-L, BATHINDA.' FROM THE ABOVE STATED STATEMENT OF FACTS BY THE AO T HE CONTENTION OF THE ASSESSEE THAT THE MANDATORY SATISFACTION AS REQ UIRED U/S 151(2) WAS NOT RECORDED BUT THE JCIT ONLY APPROVED THE ACTION OF T HE AO TO ISSUE NOTICE U/S 148. THE RELIANCE FOR THE CONTENTION IS PLACED ON FOLLOW ING JUDGMENTS:- SMT. NIRMAL KAUR VS. DICT1TA NO. 575/ASR/2016 CIT VS. M/S S. GOYANKA LIME AND CHEMICALS LTD. ITO VS. M/S OBSERVER INVESTMENT & FINANCE PVT. LTD. I TA NO. 1185 & 1186/DEL/2009 (IV) THE PROCEEDINGS U/S 147/148 ARE VOID AB INITIO BECAUSE THE REASONS TO BELIEVE FOR ISSUING THE NOTICE U/S 148 HAS BEEN RECORDED & THE NOTICE U/S 148 HAS BEEN ISSUED IN INDIVIDUAL STATUS BUT THE AO HAS HIMSELF A CCEPTED THE FACT WHILE RECORDING REASONS THAT THE ANCESTRAL LAND WAS CONTR IBUTED AS CAPITAL BY THE ASSESSEE IN THE PARTNERSHIP FIRM M/S G.S. CHAHAL & ASSOCIATES. THIS OBJECTION OF THE ASSESSEE HAS BEEN REBUTTED BY THE AO WHILE PASSI NG THE ORDER ON THE OBJECTIONS OF THE ASSESSEE & THE RELEVANT PART READ S AS UNDER:- 'THE PLEA REGARDING ANCESTRAL LAND TAKEN IN INDIVID UAL STATUS IS NOT ACCEPTABLE ALTHOUGH THE LAND WAS ANCESTRAL YET THE ASSESSEE HA S BECOME A PARTNER IN THE FIRM IN THE CAPACITY OF INDIVIDUAL AND NOT IN HUF C APACITY. THUS, THIS PLEA IS ALSO NOT ACCEPTABLE' THE ABOVE STATED FINDINGS OF THE AO ARE WRONG BECAUS E ONCE THE AO HAS STATED HIMSELF THAT THE LAND WHICH WAS CONTRIBUTED AS CAPI TAL BY THE ASSESSEE IS ANCESTRAL IN NATURE, THE NOTICE U/S 148 ISSUED IN T HE STATUS OF INDIVIDUAL IS A ILLEGAL & PROCEEDINGS U/S 147/148 BECOMES VOID AB INITIO. 6 6.1 THE LD. CIT(A) AFTER CONSIDERING THE AFORESAID SUBM ISSIONS OF THE ASSESSEE UPHELD THE ACTION OF THE A.O. IN REOPENING THE ASSESSMENT BY OBSE RVING IN PARA 4.2 OF THE IMPUGNED ORDER AS UNDER: 4.2 I HAVE GIVEN CAREFUL CONSIDERATION TO THE CONTE NTIONS ABOVE AND FIND THAT EXACTLY IDENTICAL OBJECTIONS WERE FILED BEFORE THE ASSESSING OFFICER IN THE ASSESSMENT PROCEEDINGS AS HAS BEEN MENTIONED IN PAR AGRAPH 2.1 OF THE ASSESSMENT ORDER. THE OBJECTIONS OF THE APPELLANT W ERE MET BY THE ASSESSING OFFICER VIDE ORDER DATED 15/11/2017 WHICH HAS BEEN E XTRACTED IN PARAGRAPH 3 OF ASSESSMENT ORDER. THE SERVICE OF NOTICE IN THIS CAS E HAS BEEN MADE ON 27/03/2017 THROUGH NOTICE SERVER, THEREFORE THE CONTENTION IS NOT ACCEPTABLE. THE APPELLANT IS MAKING BALD AVERMENT THAT THE APPROVING AUTHORIT Y DID NOT APPLY MIND WITHOUT MENTIONING THE BASIS OF SUCH ASSUMPTION. SIMILARLY, THE APPELLANT IS BECOMING JUDGE IN ITS OWN CASE BY TAKING AN ARGUMENT THAT TH E PROVISIONS OF SECTION 45(3) OF INCOME TAX ACT COULD NOT HAVE BEEN APPLIED IN HIS C ASE. IN A.L.A. FIRM V. CIT [1991] 189 ITR 285 (SC), A SI MILAR ISSUE OF CAPITAL GAINS WAS BEFORE THE ASSESSING OFFICER AND IT WAS HELD THAT TH E JURISDICTION OF THE INCOME-TAX OFFICER TO REASSESS INCOME ARISES IF HE HAS, IN CONS EQUENCE OF SPECIFIC AND RELEVANT INFORMATION COMING INTO HIS POSSESSION SUB SEQUENT TO THE PREVIOUS CONCLUDED ASSESSMENT, REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT. IT WAS HELD THAT EVEN IF THE IN FORMATION 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 T HE INCOME-TAX OFFICER TO INITIATE REASSESSMENT PROCEEDINGS, IF THE TWIN CONDITIONS PR ESCRIBED UNDER SECTION 147 OF THE ACT ARE SATISFIED. THE GROUNDS OF APPEAL ARE DI SMISSED. 7. NOW THE ASSESSEE IS IN APPEAL. 8. LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISS IONS MADE BEFORE THE AUTHORITIES BELOW AND ALSO MOVED AN APPLICATION FOR AD MISSION OF ADDITIONAL EVIDENCES STATING THEREIN AS UNDER: SUB: ASSESSMENT YEAR 2012-13 APPEAL ITA NO. 306& 307(ASR)/2019 AGAINST ORDER U/S 250(6) / 143(3) OF THE IT ACT, 1961, REQUEST FOR ADMISSION OF ADDITIONAL EVIDENCE IN THIS CASE, THE APPEAL IS PENDING BEFORE THE LEAR NED BENCH AND THE BRIEF FACTS OF THIS CASE ARE AS UNDER:- 1. THE ASSESSEE CONTRIBUTED ANCESTRAL AGRICULTURE LAND ALONG-WITH HIS BROTHER AS THEIR SHARE IN THE CAPITAL IN THE BOOKS OF M/S G.S. CHAHAL & AS SOCIATES AT THE TIME OF CONSTITUTING THE PARTNERSHIP FIRM. 7 2. THE A.O. INVOKED THE PROVISIONS OF SECTION 45(3) OF THE IT ACT, 1961 AND ASSESSED THE LONG TERM CAPITAL GAIN AMOUNTING TO RS. 3,20,80 ,520/- IN THE HANDS OF THE ASSESSEE VIDE ASSESSMENT ORDER PASSED U/S 143(3) DATED 20/12/2017 . 3. THE A.O. RELIED SOLELY UPON THE SALE DEED DATED 15.07.1981 FOR COMPUTING THE FMV OF THE LAND AS ON 01.04.1981 FOR THE PURPOSE OF COM PUTATION OF CAPITAL GAIN. THE COPY OF THE SUBJECT SALE DEED DATED 15.07.1981 WAS NEITHER PROVIDED NOR CONFRONTED TO THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDING S BY THE A.O. 4. THE LD. CIT(A) ALSO WHILE DECIDING THE APPEAL VI DE APPELLATE ORDER DATED 26.02.2019 DID NOT APPRECIATE THE FACT THAT THE SAL E DEED DATED 15/07/1981 RELIED UPON BY THE A.O. FOR THE PURPOSE OF COMPUTING THE FMV OF THE SUBJECT LAND WAS NEVER CONFRONTED TO THE ASSESSEE FOR THE PURPOSE OF REBUT TAL. THE SUBJECT SALE DEED WAS NOT CONFRONTED TO THE ASSESSEE BY THE CIT(A) ALSO. 5. THEREAFTER THE ASSESSEE MADE THE APPLICATION TO THE A.O. ON 07/08/2019 THEREBY REQUESTING HIM TO PROVIDE THE COPY OF THE SAID SALE DEED ON WHICH THE A.O. HAS RELIED WHILE COMPUTING THE CAPITAL GAIN [REFER PAGE NO. 10 OF THE PAPER BOOK] AND THEREAFTER THE DEPARTMENT PROVIDED THE COPY OF SALE DEED TO TH E ASSESSEE. [REFER PAGE NO. 4 TO 7 OF THE PAPER BOOK] 6. THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSE FILED CERTIFICATE FROM TEHSILDAR & VALUATION REPORT OF THE REGISTERED VALU ER WITH REGARD TO FMV OF THE SUBJECT LAND AS ON 01.04.1981 BUT THESE WERE REJECTED ARBIT RARILY. [REFER PARA 5(II) ON PAGE NO. 5 & 6 OF THE ASSESSMENT ORDER] 7. THAT THE LD. CIT(A) ALSO REJECTED THE CERTIFICAT E OF TEHSILDAR & VALUATION REPORT BY THE REGISTERED VALUER REGARDING THE FMV OF THE SUBJ ECT LAND AS ON 01.04.1981. [REFER PARA 5.2.20 ON PAGE NO. 10 & 11 OF THE APPELLATE ORDER] 8. BUT NEITHER THE A.O. NORT EH LD. CIT(A) ALLOWED ANY FURTHER OPPORTUNITY TO THE ASSESSEE TO SUBMIT THE DOCUMENTARY EVIDENCE REGARDI NG THE FMV OF THE PROPERTY AS ON 01.04.1981. 9. THE ASSESSEE ON THE ADVICE OF HIS COUNSEL, ENGAG ED FOR FILING THE APPEAL BEFORE THIS HON'BLE BENCH OF ITAT, OBTAINED THE COMPARABLE SALE INSTANCES FROM THE LOCAL REVENUE AUTHORITIES REGARDING THE FMV OF THE SUBJECT LAND A S ON 01.04.1981. 10. NOW THERE ARE NOW TOW COMPARABLE SALE INSTANCES ACCORDING TO WHICH THE FAIR MARKET VALUE OF THE LAND AS ON 01/04/1981 IS MORE A S COMPARED TO THE FAIR MARKET VALUE ADOPTED BY THE A.O. NOW, IT IS REQUESTED BEFORE THE HON'BLE BENCH TO KINDLY ADMIT THIS ADDITIONAL EVIDENCE IN THE INTEREST OF NATURAL JUST ICE IN ORDER TO ARRIVE AT THE CORRECT CAPITAL GAIN AFTER TAKING INTO CONSIDERATION THESE TWO COMP ARABLE SALES TRANSACTIONS WHICH ARE AVAILABLE ON PAGE NO. 8 TO 12 AND 13 TO 17 OF THE P APER BOOK. 11. FROM THE ABOVE SAID SUBMISSIONS IT MAY BE SUBMI TTED THAT THERE WAS REASONABLE AND SUFFICIENT CAUSE FOR NOT SUBMITTING THESE DOCUM ENTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE THE A.O. AS WELL AS APPELLATE PR OCEEDINGS BEFORE THE CIT(A). IT IS PRAYED THAT THESE ADDITIONAL EVIDENCES MAY KINDLY B E ADMITTED IN THE INTEREST OF NATURAL JUSTICE IN ORDER TO ARRIVE AT THE CORRECT FMV OF TH E CAPITAL ASSET AS ON 01/04/1981. THIS VIEW FINDS SUPPORT FROM THE FOLLOWING JUDGMENTS. (I) DECISION OF SUPREME COURT OF INDIA IN THE CASE OF TEK RAM (DEAD) THROUGH LRS VS. CIT, REPORTED IN 257 ITR 133 IN WHICH IT WAS HELD AS UND ER:- APPEAL (HIGH COURT)- ADDITIONAL DOCUMENTS PLACED BEFORE SUPREME COURT ADMISSIBILITY APPEAL AGAINST JUDGMENT OF HIGH COURT- HELD, DOCUME NTS, WHICH ASSESSEE HAD FILED BEFORE SUPREME COURT WERE OF SOME RELEVANCE- THOSE DOCUMENTS SHOULD BE LOOKED INTO BY HIGH COURT BEFORE IT COMES TO A CONCLUSION WHETH ER APPEAL REQUIRES TO BE ALLOWED OR 8 TO BE REJECTED- ORDER PASSED BY HIGH COURT SET ASID E-MATTER REMANDED BACK TO HIGH COURT APPEAL DISPOSED OF. (II) DECISION OF PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. MUKTA METAL WORKS REPORTED IN 336 ITR 555 WHEREIN IT WAS HELD THAT WH ERE THE ADDITIONAL EVIDENCE IS MUST FOR JUST DECISION OF THE CASE, THE SAME DESERVES TO BE ADMITTED. (III) DECISION OF DELHI HIGH COURT IN THE CASE OF C IT VS. TEXT HUNDRED INDIA (P.) LTD. [2011] 197 TAXMAN 128 (DELHI) IN WHICH IT HAS BEEN HELD THAT .IT IS WELL-SETTLED THAT THE PROCEDURE IS HANDMADE OF JUSTICE AND JUSTICE SHOULD NOT BE ALLOWED TO BE CHOKED ONLY BECAUSE OF SOME INADVERTENT ERROR OR OMISSION ON TH E PART OF ONE OF THE PARTIES TO LEAD EVIDENCE AT THE APPROPRIATE STAGE. ONCE IT IS FOUND THAT THE PARTY INTENDING TO LEAD EVIDENCE BEFORE THE TRIBUNAL FOR THE FIRST TIME WAS PREVENTED BY SUFFICIENT CAUSE TO LEAD SUCH AN EVIDENCE AND THAT THIS EVIDENCE WOULD HAVE MATERIAL BEARING ON THE ISSUE WHICH NEEDS TO BE DECIDED BY THE TRIBUNAL AND ENDS OF JUS TICE DEMAND ADMISSION OF SUCH AN EVIDENCE, THE TRIBUNAL CAN PASS AN ORDER TO THAT EF FECT. THE HON'BLE DELHI HIGH COURT RELIED UPON THE FOLLOWING CASE WHILE DECIDING THE A BOVE SAID CASE:- ANALKAR TRADES AND ESTATES (P.) LTD. (NO. 2) VS. CI T [1990] 186 ITR 313 (MAD.) R. DALMIA VS. CIT [1978] 113 ITR 522 (DELHI) R.S.S.. SHANMUGAM PILLAI AND SONS V. CIT [1974] 95 ITR 109 (MAD.) ITO V. B.N. BHATTACHAYRA [ 1978] 112 ITR 423 (CAL.) (IV) DECISION OF ITAT, DELHI I BENCH IN THE CASE OF UOP LIC VS. ADDITIONAL DIRECTOR OF INCOME REPORTED IN 108 ITD 186 IN WHICH IT WAS HELD THAT THE ADDITIONAL EVIDENCE SHOULD BE ADMITTED. IF IT TO MAY PRONOUNCE THE JUDGMENT BUT A LL FOR ANY OTHER SUBSTANTIATE CAUSE AND IN THIS CASE, THE DEPARTMENT WAS NOT IN APPEAL, BUT STILL THE DEPARTMENT EVIDENCE WAS ADMITTED SINCE IT HAS BEARING IN THE JUDGMENT OF TH E ABOVE SAID CASE. (V) DECISION OF MADHYA PRADESH HIGH COURT IN THE CA SE OF CIT VS. GANI BHAI WAHAB BHAI REPORTED IN 232 ITR 900. (VI) DECISION OF ITAT, DELHI BENCH, IN THE CASE OF ELECTRA (JAIPUR)(P) LTD. VS. INSPECTING ASSISTANT COMMISSIONER REPORTED IN 26 ITR 236 IN WH ICH IT WAS HELD AS UNDER: APPEAL CIT(A)- ADDITIONAL EVIDENCE ADMISSIBILIT Y IF THE EVIDENCE IS GENUINE, RELIABLE AND PROVES THE ASSESSEES CASE, ASSESSEE SHOULD NOT BE DENIED THE OPPORTUNITY TO ADDUCE IT. (VII) DECISION OF GAWAHATI HIGH COURT IN THE CASE O F CIT VS. PARIMAL KANTI CHANDA REPORTED IN 291 ITR 77 IN WHICH WAS HELD AS UNDER:- ACCORDINGLY, ADDITIONAL EVIDENCE WAS ADMITTED TO DO SUBSTANTIAL JUSTICE IN THE MATTER THUS, ADMISSION OF ADDITIONAL EVIDENCE WAS IN ACCOR DANCE WITH LAW AND DID NOT PREJUDICE THE REVENUE. (VIII) DECISION OF ITAT. B BENCH, AHMEDABAD, IN T HE CASE OF HINGORA INDUSTRIES LTD. VS. ITO IN ITA NO. 2109/AHD/2008 DATED 12/09/2012 RELATING TO A.Y. 2004-05. IN VIEW OF THESE CIRCUMSTANCES. IT IS PRAYED THAT T HE ADDITIONAL EVIDENCE MAY KINDLY BE ADMITTED IN THE INTEREST OF NATURAL JUSTICE IN ORDE R TO ARRIVE THE CORRECT FAIR MARKET VALUE AS ON 01/04/1981 FOR WORKING OF CAPITAL GAIN. SD/- [COUNSEL] 9 8.1 IT WAS FURTHER SUBMITTED THAT THE ADDITIONAL EVIDENC E RELATING TO THE SALE INSTANCE OF THE COMPARABLE CASES GO TO THE ROOT OF THE MATTER AND THE ASSESSEE WAS PREVENTED BY THE REASONABLE CAUSE TO FURNISH THOSE DOCUMENTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS AS WELL AS THE FIRST APPELLATE PROCEEDIN GS AS THE ASSESSEE COULD NOT PROCURE THE SAID DOCUMENTS AT THAT TIME. IT WAS SUBMIT TED THAT THESE DOCUMENTS ARE VERY CRUCIAL TO RESOLVE THE PRESENT CONTROVERSY THEREFO RE THE SAME MAY BE ADMITTED. 8.2 LD. DR STRONGLY OBJECTED FOR ADMISSION OF THE ADD ITIONAL EVIDENCES AND SUBMITTED THAT THE ASSESSEE NEITHER BEFORE THE A.O. NOR B EFORE THE LD. CIT(A) FURNISHED THOSE DOCUMENTS, THEREFORE THOSE MAY NOT BE ADMITTED AT THIS STAGE. 9. AS REGARDS TO THE VALIDITY OF THE PROCEEDINGS INITI ATED UNDER SECTION 147 R.W.S 148 OF THE ACT THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE SATISFACTION OF THE JCIT ON THE REASONS RECORDED BY THE A.O. IS MANDATORY IN ACCORD ANCE WITH THE PROVISIONS OF SECTION 151(2) OF THE ACT AND THE SAID SATISFACTION OF T HE JCIT OUGHT TO HAVE BEEN POSITIVE SATISFACTION WITH THE REASONS TO ARRIVE AT THE SATISFACTION AND THE APPROVAL GIVEN IN A MECHANICAL MANNER MAY NOT BE CONSIDERED TO BE PROP ER SATISFACTION IN THE EYES OF THE LAW. 9.1 LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION T OWARDS PAGE NO. 3 OF THE ASSESSEES PAPER BOOK WHEREIN JCIT, RANGE-1, BATHINDA G AVE THE APPROVAL TO ISSUE THE NOTICE UNDER SECTION 148 OF THE ACT. IT WAS SUBMITTED T HAT IN THE SAID APPROVAL THE LD. JCIT, RANGE-1, BATHINDA SIMPLY MENTIONED THAT THIS IS A FIT CASE TO ISSUE NOTICE UNDER SECTION 148 OF THE ACT AND NO SATISFACTION HAS BEEN RECO RDED THEREFORE THE SATISFACTION SO RECORDED WAS NOT VALID IN THE EYES OF LAW FOR ISSUING THE NOTICE UNDER SECTION 148 OF THE ACT. THE RELIANCE WAS PLACED ON THE D ECISION OF THE ITAT CHANDIGARH BENCH B IN THE CASE OF SHRI TEK CHAND, KARNAL VS. ITO W ARD-2, KAITHAL IN ITA NO. 255/CHD/2020 FOR THE A.Y. 2009-10 (COPY OF THE SAID OR DER WAS FURNISHED WHICH IS PLACED ON RECORD). THE RELIANCE WAS ALSO PLACED ON THE FOLLOWI NG CASE LAWS : CIT VS. S. GOYANKA LIME & CHEMICAL LTD. [2015] 64 TAX MANN.COM 313 (SC) ARJUN SINGH VS. ADIT [2000] 246 ITR 363 (M.P.) 10 10. IN HIS RIVAL SUBMISSIONS THE LD. CIT DR STRONGLY S UPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE A.O. A S WELL AS THE APPROVING AUTHORITY RECORDED THEIR SATISFACTION BEFORE ISSUING THE NOTICE UND ER SECTION 148 OF THE ACT AND THAT THE JCIT BEING COMPETENT AUTHORITY GAVE THE APPROVAL AFTER APPLYING HIS MIND, THEREFORE, THE REOPENING OF THE ASSESSMENT WAS VALID. IT WAS FURTHER STATED THAT EARLIER THE ASSESSEE APPLIED FOR VIVAD SE VISHWAS SCHEME WHICH C OULD HAVE HAPPENED ONLY WHEN THE ASSESSEE WAS NOT HAVING ANY CASE IN HIS FAVOUR. 10.1 IN HIS REJOINDER THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT DUE TO WRONG ADVICE AND UNDER PRESSURE THE ASSESSEE THOUGHT TO AVAIL THE IMMUNITY UNDER VIVAD SE VISHWAS SCHEME BUT WITHDREW THE SAME AND NEVER DEPOSITED ANY TAX, SINCE THE CASE OF THE ASSESSEE ON MERIT AS WELL AS LEGAL ISSUE WAS O N STRONG FOOTINGS. 11. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTI ES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE THE ASSESSEE FURNISHED THE ADDITIONAL EVIDENCES FIRST TIME BEFORE THE ITAT IN THE FORM OF SALE INSTANCE OF COMPARABLE CASES WHICH ARE RELEVANT TO RESOLVE THE PRES ENT CONTROVERSY. THEREFORE KEEPING IN VIEW THE PRINCIPLES OF NATURAL JUSTICE THE A DDITIONAL EVIDENCE FURNISHED BY THE ASSESSEE ARE ADMITTED. 12. AS REGARDS TO THE VALIDITY OF THE REASSESSMENT PR OCEEDINGS UNDER SECTION 147 R.W.S 148 OF THE ACT, IT IS NOT IN DISPUTE THAT THE A.O. IS REQUIRED TO GET THE APPROVAL OF THE COMPETENT AUTHORITY I.E; JCIT IN THE PRESENT CASE. CO PY OF THE FORM FOR RECORDING THE REASONS FOR INITIATING THE PROCEEDINGS UNDER SECTIO N 148 OF THE ACT AND FOR OBTAINING THE APPROVAL OF THE JCIT IS PLACED AT PAGE NO. 2 & 3 OF THE ASSESSEES PAPER BOOK WHEREIN AT S.NO. 12 RELATING TO SATISFACTION OF THE JCIT ON THE REASONS RECORDED BY THE ITO FOR ISSUING OF THE NOTICE UNDER SECTION 148 OF THE ACT. THE JCIT, RANGE-1, BATHINDA MENTIONED AS UNDER: YES, IT IS A FIT CASE TO ISSUE NOTICE UNDER SECTI ON 148 OF THE INCOME TAX ACT SD/- P.K. SHARMA JCIT, RANGE-1, BATHINDA 11 12.1 FROM THE AFORESAID APPROVAL GIVEN BY THE JCIT, R ANGE-1, BATHINDA, IT IS CLEAR THAT THE SATISFACTION HAS BEEN RECORDED IN A MECHANICAL MANNER, WITHOUT APPLYING THE MIND, FOR ISSUING THE NOTICE UNDER SECTION 148 OF THE ACT. 13. AN IDENTICAL ISSUE HAVING SIMILAR FACTS HAS BEEN AD JUDICATED BY THIS BENCH OF THE ITAT IN CASE OF SHRI SATNAM SINGH, JALANDHAR VS. ITO, WAR D-1(4), JALANDHAR IN ITA NO. 579/ASR/2019 FOR THE A.Y. 2013-14 VIDE ORDER DT. 29/ 06/2021 WHEREIN BY FOLLOWING THE ORDER DATED 15/03/2021 IN ITA NO. 215/CHD/2020 FOR THE A.Y. 2009-10 IN THE CASE OF SHRI TEK CHAND, KARNAL VS. ITO, WARD-2, KAITHAL, THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE AND THE RELEVANT FINDINGS HAVE BEEN GIVEN IN PAR A 14 TO 14.4 WHICH READ AS UNDER: 14. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE IT IS NOTICED THAT THE A.O. OBTAINED THE APPROVAL OF THE JCIT BEFORE ISSUING TH E NOTICE UNDER SECTION 148 OF THE ACT, PERFORMA COPY OF WHICH IS PLACED AT PAGE N O. 1 OF THE ASSESSEES PAPER BOOK, IN THE SAID PERFORMA FOR RECORDING THE REASON S FOR INITIATING THE PROCEEDINGS UNDER SECTION 147 / 148 OF THE ACT AND FOR OBTAININ G THE APPROVAL OF THE LD. JCIT, IT HAS BEEN MENTIONED IN COLUMN NO. 11 AS UNDER: YES IT IS APPROVED FOR 148 ACTION SD/- (UMESH TAKYAR) JOINT COMMISSIONER OF INCOME TAX RANGE-1, JALANDHAR FROM THE AFORESAID APPROVAL IT IS CLEAR THAT THE JC IT, RANGE-1, JALANDHAR RECORDED THE SATISFACTION IN A MECHANICAL MANNER WITHOUT AP PLICATION OF MIND. HE ACCORDED THE SANCTION FOR ISSUING NOTICE UNDER SECT ION 148 OF THE ACT IN A MECHANICAL MANNER. 14.1 ON A SIMILAR ISSUE THE HON'BLE GUWAHATI HIGH CO URT IN THE CASE OF LADHURAM LAXMI NARAYAN VS. ITO, ADDITIONAL 102 ITR 595 (SUPRA) HELD AS UNDER: 22. SUB-SECTION (2) OF SECTION 151 REQUIRES THAT BE FORE ISSUING A NOTICE UNDER SECTION 148, THE COMMISSIONER MUST BE SATISFIED ON THE REASONS RECORDED BY THE INCOME-TAX OFFICER THAT IT IS A FIT CASE FOR THE ISS UE OF SUCH NOTICE. THE SUBMISSION OF THE LEARNED COUNSEL IS THAT IN THE INSTANT CASE THERE WAS NO REAL SATISFACTION OF THE COMMISSIONER OR IN OTHER WORDS THERE COULD NOT BE SATISFACTION OF THE COMMISSIONER AS CONTEMPLATED UNDER SUBSECTION (2) I N THE FACTS AND CIRCUMSTANCES OF THE CASE. IN THE COLUMN OF THE REP ORT WHETHER THE COMMISSIONER WAS SATISFIED, THE ADDITIONAL COMMISSIONER SAID ' Y ES '. 23. WE HAVE ALREADY FOUND THAT THE FIRST GROUND GIV EN BY THE INCOME-TAX OFFICER IN HIS REPORT PRAYING FOR SANCTION FOR ACTIN G UNDER SECTION 148 IS ADMITTEDLY 12 A MISTAKEN GROUND AND, THEREFORE, NON-EXISTENT. THA T BEING SO, THE SATISFACTION OF THE ADDITIONAL COMMISSIONER IN THE INSTANT CASE, SO FAR AS THE FIRST GROUND IS CONCERNED, IS WHOLLY MECHANICAL WITHOUT APPLYING HI S MIND. IT HAS FURTHER BEEN HELD 24. REGARDING THE SECOND GROUND, WE FIND THAT THE S ATISFACTION COULD IN LAW BE ONLY WITH RESPECT TO CLAUSE (B) OF SECTION 147 AND THAT BEING SO THE NOTICE ISSUED ON MARCH 10, 1971, WOULD BE CLEARLY BARRED UNDER SE CTION 149 OF THE ACT. 25. IN THE RESULT, IN ANY VIEW OF THE MATTER, WE FI ND THAT THE IMPUGNED NOTICE UNDER SECTION 148 IN THE INSTANT EASE IS BAD IN LAW AND WITHOUT JURISDICTION. ACCORDINGLY, WE QUASH THE IMPUGNED NOTICE DATED MAR CH 10, 1.971, UNDER SECTION 148 OF THE ACT. 14.2 A SIMILAR VIEW HAS BEEN TAKEN BY THE HON'BLE A NDHRA PRADESH HIGH COURT IN THE CASE OF P. MUNIRATHNAM CHETTY AND P. VS. ITO , C-WARD 101 ITR 385 (SUPRA)WHEREIN IT HAS BEEN HELD AS UNDER: THE FORM LIKE THE ONE WHICH IS BEING USED CONTAININ G AN ENDORSEMENT MERELY SAYING 'YES' WOULD JUSTIFIABLY CAUSE APPREHENSION T HAT THE ACT OF THE COMMISSIONER IS A MECHANICAL ACT. IN ORDER TO OBVIA TE THIS IMPRESSION AND TO INFUSE MORE CONFIDENCE IN THE ASSESSEE, IT WOULD BE PROPER IF THE COMMISSIONER ALSO BRIEFLY SLATES WHY HE HAS GIVEN HIS SANCTION T O THE PROCEEDINGS UNDER SECTION 147, THUS AVOIDING ALL ARGUMENTS IN COURTS OF LAW W HETHER HE APPLIED HIS MIND OR HE WOULD HAVE BEEN SATISFIED IN THE CIRCUMSTANCES O F THE CASE OR NOT. 14.3 ON AN IDENTICAL ISSUE THE ITAT CHANDIGARH BENCH B CHANDIGARH VIDE ORDER DT. 15/03/2021 IN ITA NO. 215/CHD/2020 FOR TH E A.Y. 2009-10 IN THE CASE OF SHRI TEK CHAND VS ITO, WARD-2, KAITHAL HELD AS UNDE R: 14.1 THE A.O. OBTAINED THE APPROVAL OF THE PR. CIT B EFORE ISSUING THE NOTICE UNDER SECTION 148 OF THE ACT. THE PROPOSAL DT. 11/0 3/2016 SEEKING THE APPROVAL FOR ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT , BY THE A.O. IS PLACED AT PAGE NO. 2 & 3 OF THE ASSESSEES PAPER BOOK. WHILE GIVIN G THE APPROVAL THE LD. PR. CIT, KARNAL RECORDED AS UNDER: YES, SATISFIED, IT IS A FIT CASE FOR ISSUE OF NOT ICE UNDER SECTION 148 SD/- PR. CIT, KARNAL 14.2 FROM THE AFORESAID APPROVAL, IT IS CLEAR THAT THE LD. PR. CIT RECORDED SATISFACTION IN THE MECHANICAL MANNER, WITHOUT APPL ICATION OF MIND TO ACCORD SANCTION FOR ISSUING NOTICE UNDER SECTION 148 OF TH E ACT. ON AN IDENTICAL ISSUE THE HON'BLE M.P. HIGH COURT IN THE CASE OF CIT JABALPUR VS. S. GOYANKA LIME & CHEMICAL LTD. REPORTED AT (2015) 56 TAXMANN.COM 390 BY FOLLOWING ITS OWN DECISION IN THE CASE OF ARJUN SINGH VS. ADIT (2000) 246 ITR 363 (M.P) HELD AS UNDER: 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND WE FIND THAT WHILE ACCORDING SANCTION, THE JOINT COMMISSIONER, INCOME TAX HAS ONLY RECORDED SO 'YES, I AM SATISFIED'. IN THE CASE OF ARJUN SINGH (SUPRA), THE SAME QUESTION HAS BEEN 13 CONSIDERED BY A COORDINATE BENCH OF THIS COURT AND THE FOLLOWING PRINCIPLES ARC LAID DOWN: THE COMMISSIONER ACTED, OF COURSE, MECHANICALLY IN ORDER TO DISCHARGE HIS STATUTORY OBLIGATION PROPERLY IN THE MATTER OF RECO RDING SANCTION AS HE MERELY WROTE ON THE FORMAT 'YES, 1 AM SATISFIED' WHICH IND ICATES AS IF HE WAS TO SIGN ONLY ON THE DOTTED LINE. EVEN OTHERWISE ALSO, THE EXERCI SE IS SHOWN TO HAVE BEEN PERFORMED IN LESS THAN 24 HOURS OF TIME WHICH ALSO GOES TO INDICATE THAT THE COMMISSIONER DID NOT APPLY HIS MIND AT ALL WHILE GR ANTING SANCTION. THE SATISFACTION HAS TO BE WITH OBJECTIVITY ON OBJECTIV E MATERIAL.' 8. IF THE CASE IN HAND IS ANALYSED ON THE BASIS OF TH E AFORESAID PRINCIPLE, THE MECHANICAL WAY OF RECORDING SATISFACTION BY THE JOI NT COMMISSIONER, WHICH ACCORDS SANCTION FOR ISSUING NOTICE UNDER SECTION 1 48, IS CLEARLY UNSUSTAINABLE AND WE FIND THAT ON SUCH CONSIDERATION BOTH THE APPELLA TE AUTHORITIES HAVE INTERFERED INTO THE MATTER. IN DOING SO, NO ERROR HAS BEEN COM MITTED WARRANTING RECONSIDERATION. 9. AS FAR AS EXPLANATION TO SECTION 151, BROUGHT INTO FORCE BY FINANCE ACT, 2008 IS CONCERNED, THE SAME ONLY PERTAINS TO ISSUANCE OF NO TICE AND NOT WITH REGARD TO THE MANNER OF RECORDING SATISFACTION. THAT BEING SO , THE SAID AMENDED PROVISION DOES NOT HELP THE REVENUE. 10. IN VIEW OF THE CONCURRENT FINDINGS RECORDED BY THE LEARNED APPELLATE AUTHORITIES AND THE LAW LAID DOWN IN THE CASE OF AR JUN SINGH (SUPRA), WE SEE NO QUESTION OF LAW INVOLVED IN THE MATTER, WARRANTING RECONSIDERATION. 14.3 AGAINST THE SAID ORDER, THE HON'BLE APEX COURT DISMISSED THE SLP FILED BY THE DEPARTMENT AND AFFIRMED THE ORDER OF THE HON'BL E M.P. HIGH COURT IN THE CASE OF CIT VS. S. GOYANKA LIME & CHEMICALS LTD. (S UPRA) HELD AS UNDER: THAT WHERE JOINT COMMISSIONER RECORDED SATISFACTI ON IN MECHANICAL MANNER AND WITHOUT APPLICATION OF MIND TO ACCORD SANCTION FOR ISSUING NOTICE UNDER SECTION 148, REOPENING OF ASSESSMENT WAS INVALID. 15. WE THEREFORE BY FOLLOWING THE RATIO LAID DOWN B Y THE HON'BLE APEX COURT IN THE AFORESAID REFERRED TO CASE, ARE OF THE VIEW THAT THE REOPENING UNDER SECTION 148 OF THE ACT ON THE BASIS OF MECHANICAL A PPROVAL WITHOUT APPLYING THE MIND BY THE LD. PR.CIT WAS NOT VALID. THEREFORE, IN THE PRESENT CASE, THE REOPENING OF THE ASSESSMENT ON THE BASIS OF NOTICE UNDER SECTION 148 OF THE ACT IS QUASHED. 14.4 IN THE PRESENT CASE ALSO SINCE THE A.O. REOPENE D THE ASSESSMENT UNDER SECTION 147 OF THE ACT BY ISSUING THE NOTICE UNDER SECTION 148 OF THE ACT, ON THE BASIS OF MECHANICAL APPROVAL, WITHOUT APPLYING HIS MIND, THEREFORE THE SAID APPROVAL WAS NOT VALID AND CONSEQUENTLY THE REOPENI NG OF THE ASSESSMENT ON THE BASIS OF SAID APPROVAL WAS NOT VALID. WE THEREF ORE QUASH THE SAME. SINCE, WE HAVE DECIDED THE LEGAL ISSUE IN FAVOUR OF THE ASSES SEE THEREFORE NO FINDING IS GIVEN ON THE OTHER GROUNDS RAISED BY THE ASSESSEE O N MERIT. 14 13.1 SINCE THE FACTS OF THE PRESENT CASE ARE IDENTICAL TO THE FACTS INVOLVED IN THE AFORESAID REFERRED TO CASE OF SHRI SATNAM SINGH, JALAND HAR VS. ITO, WARD-1(4), JALANDHAR IN ITA NO. 579/ASR/2019 FOR THE A.Y. 2013-14, SO RESP ECTFULLY FOLLOWING THE AFORESAID REFERRED TO ORDER DT. 29/06/2021 THE REOPENING OF THE ASSESSMENT UNDER SECTION 147 OF THE ACT BY ISSUING THE NOTICE UNDER SECTION 148 OF THE ACT IS QUASHED. SINCE WE HAVE DECIDED THE LEGAL ISSUE IN FAVOUR OF THE ASSESSEE THERE FORE NO FINDING IS GIVEN ON THE OTHER GROUNDS RAISED BY THE ASSESSEE ON MERIT. 14. IN ITA NO. 307/ASR/2019 FOR THE A.Y. 2012-13 IN THE CASE OF SHRI NAROTAM SINGH, MANSA VS. ITO, WARD-1(4), MANSA, THE FACTS ARE IDENTICA L AS WERE INVOLVED IN ITA NO. 306/ASR/2019 FOR THE A.Y. 2012-13 IN THE CASE OF SHRI TRALOCHAN SINGH, MANSA VS. ITO, WARD-1(4), MANSA (SUPRA), THEREFORE OUR FINDINGS GIVEN IN THE FORMER PART OF THIS ORDER SHALL APPLY MUTATIS MUTANDIS TO THIS APPEAL ALSO. 15. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEES ARE ALLOWED. (ORDER PRONOUNCED ON 30.06.2021) SD/- SD/- (R.L. NEGI) (N.K. SAINI) JUDICIAL MEMBER VICE PRESIDENT DATED: 30.06.2021 AG ,-, / COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. CIT 4. THE CIT(A) 5. DR, ITAT, AMRITSAR 6. GUARD FILE