Smt. Bimla Wati, Jalandhar V. Income tax Officer, Phagwara

ITA 353/ASR/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5807 (ITAT-AMRITSAR)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2002-2003
• Appeal Filed On: 09-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: Y K SUD
• Keywords: Reason to believe; Reassessment proceedings
• Section: 147; 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.L. KARWA, VICE PRESIDENT AND SH. MEHAR SINGH, ACCOUNTANT MEMBER I.T.A. NO.353(ASR)/2010 ASSESSMENT YEAR:2002-03 PAN :AAHPW1972C SMT. BIMLA WATI VS. THE INCOME-TAX OFFICER, W/O SH. GIAN CHAND GUPTA, PHAGWARA-2, PHAGWARA. JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. Y.K. SUD, CA RESPONDENT BY: SH. TARSEM LAL, DR ORDER PER MEHAR SINGH, AM, THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECT ED AGAINST THE ORDER OF THE CIT(A), JALANDHAR, DATED 31.05.2010, PASSED UNDER SECTION 250(6) OF THE INCOME-TAX ACT, 1961 ( HEREINAFTER REFERRED TO IN SHORT THE ACT), FOR THE ASSESSMENT YEAR 2002-03. 3. IN GROUND NO.1, THE ASSESSEE CONTENDED THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF THE AO IN ISSUING THE NOTICE U/S 148 OF THE ACT, THEREBY REOPENING THE ASSESSMENT. I N THE COURSE OF PRESENT APPELLANT PROCEEDINGS, THE LD. COUNSEL FOR THE ASSE SSEE CONTENDED THAT THE NOTICE ISSUED BY THE AO UNDER SECTION 148 OF TH E ACT READ WITH SECTION 147 OF THE ACT, SUFFERS FROM INCURABLE INFI RMITY. THE IMPUGNED NOTICE HAS BEEN ISSUED TO THE ASSESSEE, BASED ON TH E STATEMENT OF THIRD 2 PARTY OR SURRENDER MADE BY THIRD PARTY. THE ASSESSE E-APPELLANT DID NOT MAKE ANY STATEMENT OR SURRENDER IN THE MATTER. THIS IS EVIDENT FROM THE REASONS RECORDED BY THE AO. THE LD. COUNSEL REFERRE D TO PAGE 4 OF THE PAPER TO SUPPORT HIS CONTENTION. 3.1. THE LD. DR, ON THE OTHER HAND, RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. 3.2. WE HAVE CAREFULLY PERUSED AND CONSIDERED THE F ACTS OF THE CASE, RIVAL SUBMISSIONS AND THE PAPER BOOK FILED BY THE A SSESSEE. A BARE PERUSAL OF THE REASONS RECORDED WITHIN THE MEANING OF SECTION 148 OF THE ACT, REVEALS THAT THE IMPUGNED NOTICE HAS BEEN ISSU ED TO THE ASSESSEE, ON THE BASIS OF SURRENDER MADE BY SMT. CHHAYA GUPTA. T HE ASSESSEE- APPELLANT IS IN NO WAY CONNECTED WITH SUCH SURRENDE R. THEREFORE, THE REQUIREMENT OF PROVISIONS OF SECTION 147 OF THE ACT , REMAINS UNSATISFIED. THE NOTICE HAS BEEN ISSUED ON THE BASIS OF REASON T O SUSPECT AND NOT ON THE BASIS OF REASON TO BELIEVE. THE SURRENDER OF 40 % OF THE AGRICULTURAL INCOME BY SMT. CHHAYA GUPA, IN THE COURSE OF ASSES SMENT FOR THE ASSESSMENT YEAR 2002-03 CANNOT BE MADE A GROUND FOR REOPENING THE ASSESSMENT . IT WOULD BE IN THE FITNESS OF THINGS T O REPRODUCE THE REASONS RECORDED BY THE A.O.: IN THE REASONS RECORDED U/S 148, THE AO NOTED THAT THE ASSESSEE HAD FILED RETURN OF INCOME DECLARING AGRICULTURAL I NCOME OF RS.9,58,262/- IN ADDITION TO HIS OTHER INCOME OF RS .1,61,040/-. HE WAS INFORMED BY THE DCIT, CIRCLE, PHAGWARA THAT IN THE CASE OF SMT. CHHAYA GUPTA, CO-OWNER OF AGRICULTURAL LAND ALONGWITH THE ASSESSEE, SHE HAD DECLARED NET INCOME FROM AGRICULTURAL LAND @ RS.12500/- PER ACRE WHERE IN TH E CASE OF OTHER CO-OWNERS THE NET AGRICULTURAL INCOME HAD BEE N SHOWN ON MUCH HIGHER SIDE. SMT. CHHAYA GUPTA HAD SURRENDERED 40% OF HER AGRICULTURAL INCOME TO BE TAXED AS NORMAL INCOM E INCLUDING PROFIT FROM SALE OF TREES AND HAD ALSO PROMIED TO R EVISE THE 3 RETURN OF OTHER CO-OWNERS INCLUDING THE ASSESSEE.H OWEVER, THE RETURN HAD NOT BEEN REVISED BY THE ASSESSEE. THE AO , THEREFORE, CAME TO PRIMA FACIE CONCLUSION THAT 40% OF AGRICULT URAL INCOME SHOWN BY THE ASSESSEE HAD ESCAPED ASSESSMENT AS NOR MAL INCOME. HE, THEREFORE, ISSUED NOTICE U/S 148. 3.3. A BARE PERUSAL OF THE REASONS RECORDED BY THE A.O. CLEARLY REVEALS THAT THE NOTICE UNDER SECTION 148 READ WITH SECTION 147 TO THE ASSESSEE-APPELLANT HAS BEEN ISSUED ON THE FOUNDATION OF STATEMENTS OF SMT. CHHAYA GUPTA. THE STATUTORY MANDATE, AS CONTAINED UNDER SECTION 147 I S UNAMBIGUOUS AND CLEAR, WHEREIN REASON TO BELIEVE CAN BE THE BASIS FOR INI TIATING REASSESSMENT PROCEEDINGS AND NOT THE REASON TO SUSPECT. IN THIS CASE, THERE IS NO MATERIAL AVAILABLE WITH THE ASSESSING OFFICER TO INVOKE TH E PROVISIONS OF SECTION 148 OF THE ACT. ACCORDINGLY, THE REASSESSMENT PROCEEDIN GS INITIATED BY THE A.O. UNDER SECTION 148 READ WITH SECTION 147 OF THE ACT, ARE QUASHED. 4. AS REGARDS OTHER GROUNDS RAISED BY THE ASSESSEE IN THE APPEAL, WE DO NOT CONSIDER IT ESSENTIAL TO ADJUDICATE THE SAME, A S WE HAVE QUASHED THE REASSESSMENT PROCEEDINGS INITIATED UNDER SECTION 14 8 OF THE ACT. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 15T H JUNE, 2011. SD/- SD/- (H.L. KARWA) (MEHAR SINGH) VICE PRESIDENT ACCOUNTANT MEMBER DATED:15TH JUNE, 2011 /SKR/ COPY OF THE ORDER IS FORWARDED TO : 4 1. THE ASSESSEE:SMT. BIMAL WATI W/O SH. GIAN CHAND GUP TA. 2. THE ITO, PHAGWARA-2, 3. THE CIT(A), JLR. 4. THE CIT,JLR 5. THE SR DR, ASR TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH : AMRITSAR.