Sh. Naraina Dass Taneja, New Delhi V. ITO, New Delhi

ITA 3328/DEL/2013

• Counselvise Citation: 332820114 RSA 2013
• Duration Of Justice: 1 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 19-03-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 24-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL KUMAR SHARMA
• Keywords: Reopening of assessment; Unexplained investment; Tangible material; Speculation loss; Difference of opinion; Change of opinion; Reassessment proceedings
• Section: 143(3); 147; 69; 148; 2; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH A AA A : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE BEFORE SHRI G.D. AGRAWAL, VICE BEFORE SHRI G.D. AGRAWAL, VICE BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND PRESIDENT AND PRESIDENT AND PRESIDENT AND SHRI SHRI SHRI SHRI H.S. SIDHU H.S. SIDHU H.S. SIDHU H.S. SIDHU, JUDICIAL , JUDICIAL , JUDICIAL , JUDICIAL MEMBER MEMBER MEMBER MEMBER ITA NO ITA NO ITA NO ITA NO. .. .3328/DEL/2013 3328/DEL/2013 3328/DEL/2013 3328/DEL/2013 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2004 2004 2004 2004- -- -05 0505 05 SHRI NARAIN DASS TANEJA, SHRI NARAIN DASS TANEJA, SHRI NARAIN DASS TANEJA, SHRI NARAIN DASS TANEJA, 9, KASTURBA GANDHI MARG, 9, KASTURBA GANDHI MARG, 9, KASTURBA GANDHI MARG, 9, KASTURBA GANDHI MARG, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 001. 110 001. 110 001. 110 001. PAN : AAFPT1133Q. PAN : AAFPT1133Q. PAN : AAFPT1133Q. PAN : AAFPT1133Q. VS. VS. VS. VS. INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -16(1), 16(1), 16(1), 16(1), NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SALIL AGARWAL, ADVOCATE AND SHRI SHAILESH GUPTA, CA. RESPONDENT BY : SHRI SUNIL KUMAR SHARMA, DR. ORDER ORDER ORDER ORDER PER G.D. PER G.D. PER G.D. PER G.D. AGRAWAL, VP AGRAWAL, VP AGRAWAL, VP AGRAWAL, VP : : : : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-19, NEW DELHI DATED 26 TH MARCH, 2013 FOR THE AY 2004- 05. 2. GROUND NO.1 OF THE ASSESSEES APPEAL IS OF GENER AL NATURE AND NEEDS NO SEPARATE ADJUDICATION. 3. GROUND NO.2, 3 & 4 OF THE ASSESSEES APPEAL READ AS UNDER:- 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACT S IN SUSTAINING THE INITIATION OF PROCEEDINGS UNDER SECT ION 147 OF THE ACT AND, FURTHER COMPLETION OF ASSESSMENT UN DER SECTION 143(3)/147 OF THE ACT WITHOUT SATISFYING TH E STATUTORY PRE-CONDITIONS FOR INITIATION OF THE PROC EEDINGS AND COMPLETION OF ASSESSMENT UNDER THE ACT. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS BY IGNORING THE BASIC FACT THAT ASSESSMENT WAS ALREADY FINALIZE D UNDER ITA-3328/D/2013 2 SECTION 143(3) OF THE ACT ON THE ASSESSEE, WHEREIN, ASSESSEE HAD MADE FULL AND TRUE DISCLOSURE OF ITS A FFAIRS AND MORE OVER THE REASONS RECORDED WAS MERELY BASED IN REAPPRAISAL OF EXISTING ASSESSEES RECORDS AND AS S UCH, THERE WAS NO TANGIBLE MATERIAL WITH THE LEARNED ASS ESSING OFFICER AND THUS, THE INITIATION OF PROCEEDINGS UND ER SECTION 147 IS UNTENABLE AND UNSUSTAINABLE IN LAW. 4. THAT FURTHER, THE REASONS RECORDED WERE MERE REASONS TO SUSPECT AND WERE JUST TO MAKE FISHING AN D ROVING ENQUIRIES, AS ASSESSMENT WAS ALREADY FINALIZ ED UNDER SECTION 143(3) OF THE ACT, WHEREIN FULL AND T RUE DISCLOSURE WAS MADE BY THE APPELLANT, THUS, PROCEED INGS INITIATED UNDER SECTION 148 WAS A MERE PRETENCE AND A CLEAR CASE OF CHANGE OF OPINION AND THUS, UNSUSTAIN ABLE IN LAW. 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACT S IN SUSTAINING AN ADDITION OF RS.1,66,23,750/- UNDER SE CTION 69 OF THE ACT, ON ACCOUNT OF PURCHASE OF EQUITY SHARES OF M/S ISHWAR DASS SAHNI & BROTHER LTD FROM ITS SHAREHOLDE RS NAMELY MR. BRIJ MOHAN SAHNI HUF AND NIAMAT SAHNI. 4.1 THAT IN DOING SO, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IGNORED THE BASIC FACT THAT TH E APPELLANT HAD DULY DISCLOSED THE SAID TRANSACTION I N ITS FINANCIAL STATEMENTS AND AS SUCH, SECTION 69 IS PER SE, INAPPLICABLE TO THE FACTS OF THE APPELLANT AND THUS , THE ADDITION SO SUSTAINED SHOULD BE DELETED. 4.2 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER IGNORED THE BASIC FACT THAT R EQUISITE DOCUMENTS WERE FILED AND EXPLANATION WAS TENDERED B EFORE THE LEARNED ASSESSING OFFICER, WHO FAILED IN CONDUC TING ENQUIRIES AND BASED HIS DECISION PURELY ON SUSPICIO N, SURMISES AND CONJECTURES AND AS SUCH, THE ADDITION SO MADE AND SUSTAINED SHOULD BE DELETED AS SUCH. 4. AT THE TIME OF HEARING BEFORE US, IT IS SUBMITTE D BY THE LEARNED COUNSEL THAT THE ASSESSMENT YEAR UNDER CONSIDERATIO N IS 2004-05. THE ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143 (3) OF THE INCOME-TAX ACT, 1961 ON 17.11.2006. IT WAS REOPENE D BY ISSUE OF NOTICE UNDER SECTION 148 DATED 25.3.2011. THUS, TH E REOPENING WAS MADE AFTER FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR ITA-3328/D/2013 3 AND ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143(3). THEREFORE, PROVISO TO SECTION 147 WOULD BE APPLICAB LE. AS PER THE PROVISO, UNLESS THERE IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS, THE ASSESSMENT CANNOT BE REOPENED. HE REFERRED TO THE REASONS RECORDED WHICH IS AT PAG E 67 OF THE ASSESSEES PAPER BOOK AND POINTED OUT THAT IN THE R EASONS RECORDED, THE ASSESSING OFFICER HIMSELF HAS MENTIONED IT IS OBSERVED FROM RECORD. THUS, WHATEVER REASONS HAVE BEEN RECORDED , THE SAME HAVE BEEN RECORDED ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. NO FURTHER MATERIAL OR EVIDENCE HAS COME TO THE KNOWLEDGE OF T HE REVENUE AFTER THE COMPLETION OF ORIGINAL ASSESSMENT. ALL THE FAC TS WERE ALREADY ON RECORD AT THE TIME OF ORIGINAL ASSESSMENT. HE REFE RRED TO PAGE 5 OF THE ASSESSEES PAPER BOOK WHICH IS THE QUESTIONNAIRE DA TED 17.5.2006 ISSUED DURING THE COURSE OF ORIGINAL ASSESSMENT PRO CEEDINGS. VIDE POINT NO.4, THE ASSESSING OFFICER ASKED THE ASSESSE E TO SUBMIT THE DETAILS AND EVIDENCE OF INVESTMENT MADE IN MOVEABLE AND IMMOVEABLE PROPERTIES. AT PAGE 8, THERE IS ASSESSEES REPLY I N WHICH, IN REPLY TO QUERY NO.4, THE ASSESSEE HAS DISCLOSED THE INVESTME NT MADE IN UNQUOTED SHARES OF TWO COMPANIES WHICH INCLUDED THE INVESTMENT IN 2500 SHARES OF ISHER DASS SAHNI AND BROS. (P) LTD. FOR A SUM OF ` 1,66,23,750/-. THAT IN THE REASONS RECORDED, THE A SSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE INVESTED IN THE SHARE CA PITAL OF ISHER DASS SAHNI AND BROS. (P) LTD. BUT THE ACCOUNTS OF THE AS SESSEE DID NOT REFLECT THIS INVESTMENT. HE SUBMITTED THAT THE ABOVE OBSER VATION OF THE ASSESSING OFFICER IS FACTUALLY INCORRECT. THE INVE STMENT WAS DULY DISCLOSED TO THE ASSESSING OFFICER DURING THE COURS E OF ORIGINAL ASSESSMENT PROCEEDINGS. THE ASSESSEE HAD ALSO DISC LOSED THE SOURCE FROM WHICH THE ABOVE INVESTMENT WAS MADE. HE EXPLA INED THAT THE PART OF INVESTMENT WAS MADE DURING THE ACCOUNTING Y EAR RELEVANT TO THE ASSESSMENT YEAR 2003-04 AND THEREFORE, IN THE R EPLY RELATING TO AY 2003-04, THE DETAILED EXPLANATION FOR THE SOURCE WA S GIVEN. HE ALSO STATED THAT THE ASSESSMENT PROCEEDINGS FOR AY 2003- 04 AND 2004-05 ITA-3328/D/2013 4 WERE TAKEN UP SIMULTANEOUSLY. THE LEARNED COUNSEL STATED THAT SINCE THERE WAS NO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS, THE REOPENING OF ASSESSME NT WAS NOT VALID AS PER PROVISO TO SECTION 147. HE FURTHER SUBMITTED T HAT THE REOPENING OF ASSESSMENT IS BAD IN LAW BECAUSE IT IS BASED UPON T HE CHANGE OF OPINION. HE STATED THAT WHEN DURING ORIGINAL ASSES SMENT PROCEEDINGS THE ASSESSING OFFICER RAISED THE QUERY WITH REGARD TO INVESTMENT IN ANY MOVEABLE AND IMMOVEABLE PROPERTY AND ASSESSEE STATE D THE INVESTMENT MADE IN THE SHARES OF ISHER DASS SAHNI A ND BROS. (P) LTD. THE ASSESSEE ALSO EXPLAINED THE SOURCE OF SUCH INVE STMENT WHICH WAS ACCEPTED BY THE ASSESSING OFFICER DURING ORIGINAL A SSESSMENT PROCEEDINGS. NOW, REOPENING OF THE ASSESSMENT ON T HE SAME GROUND IS CLEARLY A CASE OF CHANGE OF OPINION. IN SUPPORT OF THIS CONTENTION, HE RELIED UPON THE FOLLOWING DECISIONS:- (I) SATNAM OVERSEAS LTD. AND ANOTHER VS. ADDL.CIT [20 10] 329 ITR 237 (DELHI). (II) CIT VS. USHA INTERNATIONAL LTD. [2012] 348 ITR 48 5 (DELHI). (III) ACIT VS. SECURITIES PRIMARY DEALERSHIP LTD. [2012 ] 348 ITR 299 (SC). (IV) CIT VS. RAINEE SINGH [2010] 189 TAXMAN 202 (DELHI ). LEARNED COUNSEL, THEREFORE, SUBMITTED THAT THE NOTI CE ISSUED UNDER SECTION 148 MAY BE QUASHED. 5. LEARNED DR, ON THE OTHER HAND, ARGUED AT LENGTH. HE SUBMITTED THAT PAGES 177, 178 & 179 OF ASSESSEES PAPER BOOK ARE NOT BEFORE THE ASSESSING OFFICER. HE REFERRED TO THE LETTER PLACE D AT PAGE 30 OF THE ASSESSEES PAPER BOOK AND STATED THAT A COPY OF THE LETTER WITH THE DEPARTMENT IS NOT THE SAME WHICH THE ASSESSEE PLACE D IN THE PAPER ITA-3328/D/2013 5 BOOK. HE FURTHER SUBMITTED THAT THERE IS ALSO CONT RADICTION IN THE EXPLANATION GIVEN ABOUT THE SOURCE OF INVESTMENT IN SUCH SHARES. AT ONE PLACE, THE ASSESSEE CLAIMED TO HAVE MADE THE PA YMENT BY CHEQUE AND AT OTHER PLACE, IT CLAIMED TO HAVE MADE THE PAY MENT THROUGH A THIRD PARTY. HE FURTHER SUBMITTED THAT THE DISCLOS URE MADE BY THE ASSESSEE CANNOT BE SAID TO BE A FULL AND PROPER DIS CLOSURE BECAUSE THE SOURCE OF INVESTMENT WAS NOT FULLY AND TRULY DISCLO SED. THEREFORE, THE INFORMATION CANNOT BE SAID TO BE AN INFORMATION FUR NISHED IN TRUE SENSE. HE ALSO STATED THAT IF SOME INFORMATION IS EMBEDDED SOMEWHERE WHICH THE ASSESSING OFFICER COULD HAVE WI TH DUE DILIGENCE DISCOVERED SHALL NOT BE CONSIDERED AS FULL AND TRUE DISCLOSURE BY THE ASSESSEE. THE ASSESSEE DOES NOT MAINTAIN BOOKS OF ACCOUNT. HE FURTHER SUBMITTED THAT THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) IS A CRYPTIC ORDER JUST IN FEW LINES AND THE REFORE, NO OPINION WAS EXPRESSED BY THE ASSESSING OFFICER PASSING THE ORIG INAL ORDER. WHEN NO OPINION WAS EXPRESSED, THE QUESTION OF CHANGE OF OPINION DOES NOT ARISE. HE FURTHER SUBMITTED THAT THE CIT(A) HAS CO NSIDERED ALL THESE ASPECTS IN DETAIL AND HAS RIGHTLY REJECTED THE ASSE SSEES CONTENTION. HIS ORDER SHOULD BE UPHELD AND ASSESSEES APPEAL MA Y BE DISMISSED. 6. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BO TH THE SIDES AND PERUSED RELEVANT MATERIAL PLACED BEFORE US. TH E ASSESSMENT YEAR UNDER CONSIDERATION IS 2004-05. ORIGINAL ASSESSMEN T WAS COMPLETED UNDER SECTION 143(3). REOPENING IS MADE VIDE NOTIC E UNDER SECTION 148 DATED 25.3.2011. THUS, THE REOPENING IS MADE A FTER FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. PROV ISO TO SECTION 147 READS AS UNDER:- PROVIDED THAT WHERE AN ASSESSMENT UNDER SUB-SECTIO N (3) OF SECTION 143 OR THIS SECTION HAS BEEN MADE FOR TH E RELEVANT ASSESSMENT YEAR, NO ACTION SHALL BE TAKEN UNDER THIS SECTION AFTER THE EXPIRY OF FOUR YEARS FROM TH E END OF THE RELEVANT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH ITA-3328/D/2013 6 ASSESSMENT YEAR BY REASON OF THE FAILURE ON THE PAR T OF THE ASSESSEE TO MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION (1) O F SECTION 142 OR SECTION 148 OR TO DISCLOSE FULLY AND TRULY A LL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT, FOR THAT ASSESS MENT YEAR: 7. AS PER THE ABOVE PROVISO TO SECTION 147, SINCE I N THIS CASE REOPENING IS MADE AFTER FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR AND THE ORIGINAL ASSESSMENT WAS COM PLETED UNDER SECTION 143(3), THE ASSESSMENT CANNOT BE REOPENED U NLESS THERE IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FUL LY AND TRULY ALL MATERIAL FACTS NECESSARY FOR ASSESSMENT FOR THAT AS SESSMENT YEAR. COPY OF REASONS RECORDED FOR REOPENING OF ASSESSMEN T IS GIVEN AT PAGE 67 OF THE ASSESSEES PAPER BOOK WHICH READS AS UNDE R:- 1. NAME OF THE ASSESSEE : SH. NARAIN DASS TANEJA 2. PAN NO. : AAFPT1133Q 3. ASSESSMENT YEAR : 2004-05 4. STATUS : INDIVIDUAL REASONS RECORDED U/S 147 OF THE I.T.ACT, 1961 1. UNEXPLAINED INVESTMENT THE ASSESSEE FILED RETURN OF INCOME DECLARING LOSS OF RS.6,21,629/- FOR ASSESSMENT YEAR 2004-05 ON 01.11. 2004. THE ASSESSMENT IN THIS CASE WAS COMPLETED U/S 143(3 ) ON 17.11.2006 AT AN INCOME OF RS.6,21,629/-. IT WAS OBSERVED FROM THE RECORDS THAT THE ASSESSEE HAS INVESTED AS SHARE CAPITAL A SUM OF RS.1,66,23,7 50/- IN M/S ISHER DASS SAHNI AND BROS. PVT.LTD. BUT THE AC COUNTS OF THE ASSESSEE DID NOT REFLECT THIS INVESTMENT AND TH EREFORE HAD TO BE ADDED IN THE INCOME OF ASSESSEE AS UNEXPL AINED INVESTMENT U/S 69 HOWEVER, THE ABOVE POINT WAS NOT TAKEN IN CONSIDERATION WHILE FRAMING THE ASSESSMENT. 2. RECOMMENDATION IN VIEW OF THE ABOVE FACTS, I HAVE REASON TO BELIE VE THAT THE INCOME OF THE ASSESSEE, SH. NARAIN DASS TA NEJA HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTIO N 147 OF THE I.T. ACT 1961 TO THE TUNE OF RS.1,66,23,750/ - FOR ASSESSMENT YEAR 2004-05 BY REASON OF OMISSION OR FA ILURE ITA-3328/D/2013 7 ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND T RULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT. 8. FROM THE ABOVE, IT IS EVIDENT THAT THE ASSESSING OFFICER HIMSELF HAS MENTIONED IT WAS OBSERVED FROM THE RECORDS THA T THE ASSESSEE HAS INVESTED AS SHARE CAPITAL A SUM OF RS.1,66,23,7 50/- IN M/S ISHER DASS SAHNI AND BROS. PVT.LTD. BUT THE ACCOUNTS OF THE ASSESSEE DID NOT REFLECT THIS INVESTMENT. FROM THE ABOVE OBSERVATI ON, IT IS EVIDENT THAT THE INFORMATION IS AVAILABLE ON RECORD. THE ASSESS ING OFFICER HIMSELF HAS MENTIONED THAT THE INFORMATION ABOUT THE INVEST MENT IN SHARES IS TAKEN FROM THE RECORD. AT PAGES 3 & 4 OF ASSESSEE S PAPER BOOK, THERE IS STATEMENT OF AFFAIRS OF THE ASSESSEE AS ON 31 ST MARCH, 2004. IN THE LIST OF INVESTMENT IN SHARES, THERE IS A MENTION OF M/S ISHER DASS SAHNI AND BROS. PVT.LTD. AMOUNTING TO ` 1,66,23,750/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ISSUE D QUESTIONNAIRE DATED 17.05.2006. VIDE QUESTION NO.4, DETAILS AND EVIDENCE OF INVESTMENT MADE IN THE MOVABLE AND IMMOVABLE PROPER TIES DURING THE YEAR UNDER CONSIDERATION WERE ASKED. AT PAGE 8, TH ERE IS A REPLY BY THE ASSESSEE. WITH REGARD TO QUESTION NO.4, THE RE PLY OF THE ASSESSEE READS AS UNDER:- Q.NO.4. THE ASSESSEE HAS NOT MADE ANY INVESTMENT I N IMMOVABLE PROPERTIES DURING THE YEAR UNDER CONSIDER ATION. FURTHER, THE ASSESSEE IS SUBMITTING HEREWITH DETAILS OF INVE STMENT MADE IN UNQUOTED SHARES IN THE FOLLOWING COMPANIES : NAME OF COMPANY NO. OF SHARES AMOUNT A) DELUXE PROPERTIES & IND. LTD. 300 3000.00 B) ISHERDAS SAHNI & BROS.PVT.LTD. 2500 1662 3750.00 REGARDING INVESTMENT IN 2500 SHARES OF M/S ISHERDAS SAHNI & BROS. PVT.LTD., THE ASSESSEE HAS ALREADY SUBMITTED THE RE LEVANT DETAILS BEFORE YOUR GOODSELF IN ASSESSMENT PROCEEDINGS FOR ASSESSMENT YEAR 2003-04. 9. THUS, DURING THE COURSE OF ORIGINAL ASSESSMENT P ROCEEDINGS, THE ASSESSING OFFICER RAISED THE QUESTION WITH REGARD T O INVESTMENT IN MOVABLE AND IMMOVABLE PROPERTIES AND THE ASSESSEE S TATED THAT THERE ITA-3328/D/2013 8 IS NO INVESTMENT IN THE IMMOVABLE PROPERTIES BUT IN THE MOVABLE PROPERTIES, THERE IS AN INVESTMENT IN SHARES. THE MAJOR INVESTMENT WAS IN M/S ISHER DASS SAHNI AND BROS. PVT.LTD. AMOU NTING TO ` 1,66,23,750/-. LEARNED DR WHO APPEARED BEFORE US H AS NOT DISPUTED THAT THESE PAPERS ARE AVAILABLE ON THE FILE OF THE ASSESSING OFFICER. LEARNED DR HAS STATED THAT PAPER NOS.177, 178 & 179 OF THE ASSESSEES PAPER BOOK ARE NOT AVAILABLE ON RECORD O F THE ASSESSING OFFICER. HOWEVER, FROM THE INDEX ITSELF, WE FIND T HAT THOSE PAPERS WERE EITHER THE WRITTEN SUBMISSIONS OR SOME ANNEXURES TO THE WRITTEN SUBMISSION FILED ALONGWITH THE WRITTEN SUBMISSIONS BEFORE THE LEARNED CIT(A). THE ASSESSEE HIMSELF HAS MENTIONED THAT DO CUMENTS PLACED AT SR.NO.15 TO 18 OF THE INDEX WERE BEFORE THE CIT(A) AND HE HAS NOT REFERRED TO ANY SUCH DOCUMENT. FROM THE PAPERS WHI CH WERE ADMITTEDLY AVAILABLE BEFORE THE ASSESSING OFFICER, IT IS EVIDENT THAT THE ASSESSEE HAS DULY DISCLOSED THE FACTUM OF INVESTMEN T IN SHARES AMOUNTING TO ` 1,66,23,750/-. IN THE REASONS RECORDED, THE ASSESS ING OFFICER HAS ALSO OBSERVED THAT FROM THE RECORD, IT IS OBSERVED THAT THE ASSESSEE HAS INVESTED AS SHARE CAPITAL A SUM OF ` 1,66,23,750/- IN M/S ISHER DASS SAHNI AND BROS. PVT.LTD. THUS, ADMITTED LY, THE ASSESSEE HAS DISCLOSED THE FACT OF INVESTMENT IN SHARES OF M/S I SHER DASS SAHNI AND BROS. PVT.LTD. AMOUNTING TO ` 1,66,23,750/-. AS PER ASSESSEE, IT HAS GIVEN SATISFACTORY EXPLANATION WITH REGARD TO SOURC E OF INVESTMENT IN SUCH SHARES. AS PER LEARNED DR, THE ASSESSEE HAS N OT SATISFACTORILY EXPLAINED THE SOURCE OF INVESTMENT IN SUCH SHARES. AS PER LEARNED DR, AT SOME PLACE, THE ASSESSEE HAS STATED THAT THE INV ESTMENT IS MADE BY CHEQUE AND AT SOME PLACE, IT HAS STATED THAT THE IN VESTMENT IS MADE BY THE THIRD PARTY. IT WAS CLARIFIED BY THE LEARNE D COUNSEL THAT PART OF THE INVESTMENT WHICH IS MADE DIRECTLY BY THE ASSESS EE IS BY CHEQUE AND SOME PART IS PAID BY THE THIRD PARTY. ON THESE FACTS, THE DECISION OF HONBLE APEX COURT IN THE CASE OF ACIT AND OTHER S VS. ICICI SECURITIES PRIMARY DEALERSHIP LTD. [2012] 348 ITR 299 (SC) WOULD BE SQUARELY APPLICABLE. IN THE ABOVE CASE, THE ASSESS EE HAD DISCLOSED THE ITA-3328/D/2013 9 FULL DETAILS IN THE RETURN OF INCOME WITH REGARD TO DEALING IN STOCK AND SHARES. THEREAFTER, THE ASSESSMENT WAS REOPENED ON THE GROUND THAT THE LOSS INCURRED BY THE ASSESSEE FROM THE SALE OF SHARES WAS A SPECULATION LOSS AND NOT BUSINESS LOSS. HON'BLE BO MBAY HIGH COURT QUASHED THE NOTICE ISSUED UNDER SECTION 148 WITH TH E FOLLOWING FINDING:- IN THE FACTS OF THE PRESENT CASE, THERE IS NOTHING NEW WHICH HAS COME TO THE NOTICE OF THE REVENUE. THE ACCOUNTS HAD BEEN FURNISHED BY THE PETITIONER WHEN CALLED UPON. THEREAFTER, THE ASSESSMENT WAS COMPLETED UND ER SECTION 143(3) OF THE INCOME-TAX ACT. NOW, ON A ME RE RELOOK, THE OFFICER HAS COME TO THE CONCLUSION THAT THE INCOME HAS ESCAPED ASSESSMENT AND HE IS OF COURSE JUSTIFIED IN HIS ANALYSIS. IN OUR VIEW, THIS IS NO T SOMETHING WHICH IS PERMISSIBLE UNDER THE PROVISO TO SECTION 1 47 OF THE INCOME-TAX ACT WHICH SPEAKS ABOUT A FAILURE ON THE PART OF THE ASSESSEE TO MAKE A PROPER RETURN. IN T HE PRESENT CASE, NO SUCH CASE IS MADE OUT ON THE RECOR D. IN THE CIRCUMSTANCES, WE ALLOW THIS PETITION IN TERMS OF PRAYER (A) AND QUASH AND SET ASIDE THE NOTICE DATED MARCH 27, 2006, DIRECTING REOPENING OF THE ASSESSMENT FOR THE YEAR 1999-2000. 10. THE REVENUE HAD FILED THE APPEAL AGAINST THE AB OVE DECISION OF HON'BLE BOMBAY HIGH COURT TO HONBLE APEX COURT AND HONBLE APEX COURT AFFIRMED THE DECISION OF HON'BLE BOMBAY HIGH COURT WITH THE FOLLOWING FINDING:- THE ASSESSEE HAD DISCLOSED FULL DETAILS IN THE RET URN OF INCOME IN THE MATTER OF ITS DEALING IN STOCKS AND S HARES. ACCORDING TO THE ASSESSEE, THE LOSS INCURRED WAS A BUSINESS LOSS, WHEREAS, ACCORDING TO THE REVENUE, T HE LOSS INCURRED WAS A SPECULATIVE LOSS. REJECTION OF THE OBJECTIONS OF THE ASSESSEE TO THE REOPENING OF THE ASSESSMENT BY THE ASSESSING OFFICER, VIDE HIS ORDER DATED 23 RD JUNE, 2006, IS CLEARLY A CHANGE OF OPINION. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ORDER REOPENING THE ASSESSMENT WAS NOT MAINTAINABLE. ITA-3328/D/2013 10 11. THAT THE FACTS OF THE ASSESSEES CASE ARE IDENT ICAL. THE ASSESSEE HAD DISCLOSED THE FACT OF INVESTMENT IN SHARES IN T HE STATEMENT OF AFFAIRS WHICH WAS FILED ALONGWITH THE RETURN OF INC OME AND ALSO DURING THE COURSE OF ASSESSMENT PROCEEDINGS WHEREIN THE AS SESSING OFFICER RAISED A SPECIFIC QUERY WITH REGARD TO INVESTMENT I N MOVEABLE AND IMMOVABLE PROPERTIES. THE ASSESSEE ALSO EXPLAINED THE SOURCE OF INVESTMENT IN SHARES. THEREAFTER, THE ASSESSING OF FICER COMPLETED THE ASSESSMENT UNDER SECTION 143(3). ADMITTEDLY, NOTHI NG NEW HAS COME TO THE NOTICE OF THE REVENUE BUT THE ASSESSMENT IS BEING SOUGHT TO BE REOPENED ON A MERE RELOOK OF THE MATTER ALREADY AVA ILABLE ON RECORD. THEREFORE, THE ABOVE DECISION OF HONBLE APEX COURT WOULD BE SQUARELY APPLICABLE TO THE CASE OF THE ASSESSEE. THAT THE F ULL BENCH OF HON'BLE JURISDICTIONAL HIGH COURT HAS ALSO TAKEN THE SIMILA R VIEW IN THE CASE OF CIT VS. USHA INTERNATIONAL LTD. [2012] 348 ITR 48 5 (DELHI) AND HELD :- REASSESSMENT PROCEEDINGS WILL BE INVALID IN CASE A N ISSUE OR QUERY IS RAISED AND ANSWERED BY THE ASSESSEE IN ORIGINAL ASSESSMENT PROCEEDINGS BUT THEREAFTER THE ASSESSING OFFICER DOES NOT MAKE ANY ADDITION IN THE ASSESSMEN T ORDER. IN SUCH SITUATIONS IT SHOULD BE ACCEPTED TH AT THE ISSUE WAS EXAMINED BUT THE ASSESSING OFFICER DID NO T FIND ANY GROUND OR REASON TO MAKE ADDITION OR REJECT THE STAND OF THE ASSESSEE. HE FORMS AN OPINION. THE REASSES SMENT WILL BE INVALID BECAUSE THE ASSESSING OFFICER HAD F ORMED AN OPINION IN THE ORIGINAL ASSESSMENT, THOUGH HE HAD N OT RECORDED HIS REASONS. 12. THE FACTS OF THE ASSESSEES CASE ARE ALSO IDENT ICAL. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFF ICER RAISED THE QUERY WITH REGARD TO INVESTMENT IN SHARES AND THE S OURCE OF SUCH INVESTMENT. THE REPLY WAS FURNISHED BY THE ASSESSE E. THE ASSESSING OFFICER DID NOT MAKE ANY ADDITION. THUS, HE FORMED AN OPINION ACCEPTING THE ASSESSEES EXPLANATION FOR SOURCE OF INVESTMENT IN SUCH SHARES. NOW, REOPENING ON THE BASIS OF SAME MATERI AL WHICH IS ALREADY AVAILABLE ON RECORD WOULD BE A CLEAR CASE OF CHANGE OF OPINION. IN VIEW OF THE ABOVE, WE, RESPECTFULLY FOLLOWING THE DECISI ON OF HONBLE APEX ITA-3328/D/2013 11 COURT IN THE CASE OF ICICI SECURITIES PRIMARY DEALE RSHIP LTD. (SUPRA), OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF US HA INTERNATIONAL LTD. (SUPRA) AND ALSO IN VIEW OF THE PROVISO TO SECTION 147, HOLD THAT THE REOPENING OF ASSESSMENT BY THE ASSESSING OFFICER UN DER SECTION 147 WAS NOT VALID. WE, THEREFORE, QUASH THE NOTICE ISS UED UNDER SECTION 148 BEYOND THE PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR AND CONSEQUENTIALLY, THE ASSESSMENT ORDER FRAMED IN PURSUANCE TO SUCH NOTICE IS ALSO QUASHED. 13. SINCE WHILE ADJUDICATING GROUND NOS.2, 3 & 4 WE HAVE QUASHED THE ASSESSMENT ORDER, THE OTHER GROUNDS OF APPEAL, WHICH ARE AGAINST THE ADDITION MADE BY THE ASSESSING OFFICER AND SUST AINED BY THE LEARNED CIT(A), DO NOT SURVIVE FOR ADJUDICATION. 14. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 14 TH AUGUST, 2014. SD/- SD/- ( (( (H.S. SIDHU H.S. SIDHU H.S. SIDHU H.S. SIDHU) )) ) (G.D. AGRAWAL (G.D. AGRAWAL (G.D. AGRAWAL (G.D. AGRAWAL) )) ) JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 14.08.2014 VK. COPY FORWARDED TO: - 1. APPELLANT : SHRI NARAIN DASS T SHRI NARAIN DASS T SHRI NARAIN DASS T SHRI NARAIN DASS TANEJA, ANEJA, ANEJA, ANEJA, 9, KASTURBA GANDHI MARG, NEW DELHI 9, KASTURBA GANDHI MARG, NEW DELHI 9, KASTURBA GANDHI MARG, NEW DELHI 9, KASTURBA GANDHI MARG, NEW DELHI 110 001. 110 001. 110 001. 110 001. 2. RESPONDENT : INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -16(1), NEW DELHI. 16(1), NEW DELHI. 16(1), NEW DELHI. 16(1), NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR