DCIT, Jaipur V. VIMAL CHAND SURANA HUF, Jaipur

ITA 437/JPR/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6139 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 26-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VARINDER MEHTA
• Assessee Lawyers: S R SHARMA; R K MATRA CA DHK
• Keywords: Reopening of assessment; Depreciation; Search and seizure; Loose papers; Document seized; Question of law; Tangible material; Difference of opinion; Block assessment; Reason to believe; Documents seized; Change of opinion; Reassessment proceedings
• Section: 143(3); 153A; 147; 131; 148; 132; 139

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH HKKXPAN] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA-@ ITA NO. 437/JP/2017 FU/KZKJ.K O'KZ@ ASSESSMENT YEAR : 2007-08 DY. COMMISSIONER OF INCOME TAX, CIRCLE-2, JAIPUR. CUKE VS. VIMAL CHAND SURANA (HUF), 2231, LAL KATLA, HALDIYON KA RASTA, JOHARI BAZAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABHV 6622 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI VARINDER MEHTA (CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.R. SHARMA & SHRI R.K. MATRA (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 07/05/2018 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 17/05/2018 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THE APPEAL FILED BY THE REVENUE EMANATES FROM THE O RDER OF THE LD. CIT(A)-4 JAIPUR DATED 30/03/2017 FOR THE A.Y. 2007-0 8. 2. THE APPELLANT FILED HIS ORIGINAL RETURN OF INCOME FOR ASSESSMENT YEAR 2007 08 ON 27-10-2007 DECLARING A TOTAL INCO ME OF RS. 5,66,74,000/- U/S. 139(1) OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT). THE ASSESSMENT WAS COMPLETED U/S. 143(3) AT THE TOTAL INCOME OF RS. 5,66,74,000/- ON 09-10-2009. THE APPELLANT DISCLOSED THE SHARES ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 2 PURCHASE TRANSACTION IN HIS BALANCE SHEET FILED DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS. SUBSEQUENTLY, A SEARCH AND SEIZURE OPERATION WAS CONDUCTED ON SHRI RAJENDRA JAIN GROUP AND HIS AS SOCIATE GROUP MEMBERS ON 23-05-2013 BY THE INVESTIGATION WING, JAI PUR OF THE INCOME TAX DEPARTMENT, IN WHICH MR. MADAN MOHAN GUPTA WAS ALS O COVERED. DURING THE COURSE OF SEARCH AND SEIZURE OPERATION O N MR. MADAN MOHAN GUPTA, VARIOUS INCRIMINATING DOCUMENTS WERE FOUND AN D SEIZED. STATEMENT OF SHRI MADAN MOHAN GUPTA WAS RECORDED ON 23-05-2013 AND 27-05-2013. THE STATEMENT OF APPELLANT WAS ALSO RECOR DED U/S. 131 ON 16-08-2013. MR. MADAN MOHAN GUPTA ON 26-02-2015 RE TRACTED HIS ORIGINAL STATEMENT RECORDED ON 23.5.2013 AND 27.5.2 013 BY FILING AN AFFIDAVIT, PURSUANT TO FILING AN AFFIDAVIT THE STAT EMENT OF SHRI MADAN MOHAN GUPTA WAS RECORDED ON 24 MARCH 2015 BY ACIT CC- 2 AND VIDE ANSWER TO QUESTION NO. 5 HE CATEGORICALLY DENIED HAV ING ANY RECEIPT OF CASH FROM APPELLANT. THE A.O. ISSUED NOTICE U/S 148 DATED 21-03-2014 ON THE ASSESSEE HUF ON THE BASIS OF STATEMENT RECORDED IN COURSE OF SEARCH FROM SHRI MADAN MOHAN GUPTA. THE ASSESSEE COMPLIED T HE NOTICE BY FILING RETURN OF INCOME DECLARING SAME INCOME AS WAS ASSESSED U/S 143 (3). THE ASSESSEE REQUESTED COPY OF REASONS RECORDED AND COPY OF SANCTIONS ACCORDED U/S 151 WHICH WERE SUPPLIED AND AL SO FILED OBJECTIONS TO NOTICE U/S 148 WHICH WERE REJECTED BY A.O.. THE A. O. PROCEEDED TO ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 3 REASSESS THE ASSESSEE HUF AND COMPLETED THE RE-ASSE SSMENT BY ADDING RS. 4,15,32,446/- AS SUBSTANTIVE ADDITION IN THE HA NDS OF MADAN MOHAN GUPTA AS PER SECTION 292C OF THE ACT AS THE PAPERS WERE FOUND FROM THE PREMISES OF MADAN MOHAN GUPTA AND PRIMARY ONUS LIES WITH HIM TO EXPLAIN THESE ENTRIES. HOWEVER, A PROTECTIVE ADDITIO N OF RS. 4,15,32,446/- HAS ALSO BEEN MADE IN THE HANDS OF ASSESSEE HUF TO SAFEGUARD THE INTEREST OF REVENUE. THE LD. CIT(A) HAS GIVEN RELIEF TO THE ASSESSEE. 3. NOW THE REVENUE IS IN APPEAL BEFORE THE ITAT BY TA KING FOLLOWING GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A)-4, JAIPUR HAS ERRED IN QUASHING THE R E-OPENING OF ASSESSMENT. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) HAS ERRED IN DELETING THE WHOLE P ROTECTIVE ADDITION OF RS. 4,15,32,446/- INSTEAD OF RESTRICTIN G TO THE SAME TO RS. 2,80,00,792/-(BEING 13.44% OF SALE CONSIDERATIO N OF RS.20,83,39,232-). 3. WHETHER ON THE FACTS AND THE CIRCUMSTANCES OF T HE CASE AND IN LAW THE LD CIT(A) HAS ERRED IN DELETING THE WHOLE P ROTECTIVE ADDITION OF RS 4,15,32,446/- BY HOLDING THE TRANSFE R OF SHARES TOOK PLACE ON 05.04.2007 IGNORING THE DATE OF SIGNING OF SHARE TRANSFER FORM I.E. FORM NO. 7-B ON 27.03.2007. 4. THE APPELLANT CRAVES THE RIGHT TO AMEND ALTER OR ADD TO ANY OF THE GROUNDS OF APPEAL GIVEN ABOVE. 4. THE 1 ST GROUND OF APPEAL IS AGAINST QUASHING THE REOPENING OF THE ASSESSMENT BY THE LD. CIT(A). THE LD. CIT(A) HAS QUAS HED THE PROCEEDING ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 4 INITIATED U/S 147 OF THE ACT BY PASSING A SPEAKING ORDER. FOR THE SAKE OF CONVENIENCE, THE FINDING OF THE LD. CIT(A) IS NOT RE QUIRED TO BE REPEATED. 5. THE LD. CIT DR HAS VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 6. ON THE OTHER HAND, THE LD AR OF THE ASSESSEE HAS REITERATED THE ARGUMENTS AS MADE BEFORE THE LD. CIT(A) AND FURTHER SUBMITTED AS UNDER: IN THIS CONNECTION IT IS SUBMITTED THAT THE LD. A.O . WHILE INITIATED PROCEEDING U/S 148 RECORDED FOLLOWING REASONS U/S 147 OF THE ACT. A SEARCH & SEIZURE OPERATION WAS CARRIED OUT AT T HE RESIDENTIAL PREMISES OF SHRI MADAN MOHAN GUPTA AT VRINDAVAN, DIGGI ROAD, SANGANE R ROAD, JAIPUR AND ALSO SURVEY PROCEEDINGS WERE CARRIED OUT AT THE BUSINESS PREMISES OF SHRI MADAN MOHAN GUPTA AT A30, SARSWATI COLONY, SANGANER, JAIP UR WHEREBY CERTAIN INCRIMINATING DOCUMENTS WERE FOUND AND SEIZED/IMPOU NDED. DURING THE COURSE OF STATEMENTS, SHRI MADAN MOHAN G UPTA SUBMITTED THAT A TRANSACTION OF LAND AT VILLAGE CHAINPURA BEHIND E.P . WAS CARRIED OUT IN WHICH THE SAID LAND WAS PURCHASED BY SHRI RAJENDRA KUMAR JAIN THROUGH SHRI MADAN MOHAN GUPTA. THE DEAL WAS FINALIZED AT RS. 12,43,27,000/- OUT OF WHICH DISCOUNT OF 1% WAS ALLOWED FOR EARLY REGISTRATION OF LAND. THEREFO RE RS. 12,30,84,000/- WAS NET PAYABLE TO THE SELLERS. THIS LAND WAS PURCHASED DUR ING THE A.Y. 2006-07 AND SOLD TO K.G. KOTHARI, PRITHVIRAJ ROAD, C-SCHEME, JAIPUR AND SHRI VIMAL CHAND SURANA IN THE MONTH OF MARCH, 2007. THIS SALE TRANSACTION WAS FINALIZED FOR RS. 20,83,39,232/-. ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 5 IN LIGHT OF STATEMENTS OF SHRI MADAN MOHAN GUPTA, S TATEMENT OF SHRI VIMAL CHAND SURANA WAS RECORDED ON OATH ON 16.08.2013. SH RI VIMAL CHAND SURANA HAD SUBMITTED THAT HE DID NOT PURCHASE ANY LAND FROM SH RI MADAN MOHAN GUPTA NOR ANY PAYMENT WAS MADE TO SHRI MADAN MOHAN GUPTA. HOW EVER, SHRI VIMAL CHAND SURANA ACCEPTED THAT HE HAD PURCHASED 1334 EQUITY S HARES OF M/S KALYAN BUILDMART PVT. LTD. IN THE NAME OF HIS HUF OUT OF W HICH 667 EQUITY SHARES WERE PURCHASED FROM SHRI MADAN MOHAN GUPTA AND 667 EQUIT Y SHARES FROM SMT. SHASHIKALA GUPTA W/O SHRI MADAN MOHAN GUPTA. IN THI S COMPANY, LAND NEAR E.P. IS AN ASSET. THESE EQUITY SHARES WERE PURCHASED DUR ING MARCH, 2007 AND RS. 67,700/- WERE PAID TO SHRI MADAN MOHAN GUPTA ON 23. 06.2007 AND RS. 67,700/- WERE PAID TO SMT. SHASHIKALA GUPTA ON 19.04.2007, O N ACCOUNT OF SALE CONSIDERATION OF THESE SHARES. FROM THE ABOVE IT IS CLEAR THAT LAND BEHIND E.P. WA S PURCHASED IN THE GUISE OF SALE OF SHARES OF SHRI KALYAN BUILDMART PVT. LTD., IN WH ICH SHRI VIMAL CHAND SURANA HUF HAS 20% SHAREHOLDING. SINCE, THE SHARE OF LAND IN VIMAL CHAND SURANA HUF IS 20%, HIS SHARE IN SALE COMES OUT TO BE 41667846/-. HENCE, ON THE BASIS OF ABOVE, I HAVE REASON TO BELIEVE THAT INCOME OF RS. 41532446/- [(41667846+13 5400)] HAS ESCAPED ASSESSMENT. THUS, IN LIEU OF THE INFORMATION IN MY POSSESSION, I HAVE REASON TO BELIEVE THAT INCOME OF RS. 41532446/- HAS ESCAPED ASSESSMENT. HE NCE, IT IS A FIT CASE FOR ISSUE OF NOTICE U/S 148. IN THIS CONNECTION IT IS SUBMITTED THAT IN THE REAS ONS RECORDED AS WELL AS IN DISCUSSION IN ASSESSMENT ORDER IT IS STATED THAT SH RI VIMAL CHAND SURANA ACCEPTED THAT HE HAD PURCHASED 1334 EQUITY SHARES OF M/S KAL YAN BUILDMART PVT. LTD. IN THE NAME OF HIS HUF OUT OF WHICH 667 EQUITY SHARES WERE PURCHASED FROM SHRI MADAN MOHAN GUPTA AND 667 EQUITY SHARES FROM SMT. S HASHIKALA GUPTA W/O SHRI ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 6 MADAN MOHAN GUPTA. IN THIS COMPANY, LAND NEAR E.P. IS AN ASSET. THESE EQUITY SHARES WERE PURCHASED DURING MARCH, 2007 AND RS. 67 ,700/- WERE PAID TO SHRI MADAN MOHAN GUPTA ON 23.06.2007 AND RS. 67,700/- WE RE PAID TO SMT. SHASHIKALA GUPTA ON 19.04.2007, ON ACCOUNT OF SALE CONSIDERATION OF THESE SHARES AND IT IS FURTHUR STATED THAT THUS SHRI VIMAL CHAND SURANA HAS 20% SHAREHOLDING OF SHRI KALYAN BUILDMART P. LTD. IN THIS CONNECTION IT IS BROUGHT ON RECORD THAT IT IS CORRECT THAT SHRI VIMAL CHAND SURANA HAS PURCHASED 1334 EQUITY SHARES OF KALYAN B UILDMART P. LTD. FROM THE PERSONS AS STATED ABOVE BUT THE SAME IS NOT 20% SHA REHOLDING IN COMPANY. THE PAID UP SHARE CAPITAL OF COMPANY IS 10000 EQUITY SH ARES OF RS. 10 EACH (TOTAL PAID CAPITAL RS. 1,00,000/-) AND HOLDING OF 1334 EQUITY SHARES BY SHRI VIMAL CHAND SURANA HUF IS 13.34%. THUS EQUITY SHARE HOLDING OF VIMAL CHAND SURANA IN THE COMPANY IS 13.34% AT THE TIME OF PURCHASE OF THESE SHARES FROM ABOVE STATED PERSONS. THE REASONS RECORDED ARE WRONG TO THIS EXT ENT. THE SANCTION FOR REOPENING GRANTED U/S 151 BY ADDIT IONAL COMMISSIONER WHILE GIVING APPROVAL READS YES, IT IS A FIT CASE FOR REO PENING OF ASSESSMENT U/S 147 AS RS. 1,70,51,406/- (BEING THE AMOUNT PAID IN CASH) H AS ESCAPED ASSESSMENT AND CIT 1, JAIPUR HAS ALSO ENDORSED IT BY NOTING YES I AM SATISFIED THAT IT IS A FIT CASE FOR ISSUE OF NOTICE U/S 148 OF THE ACT. THE SANCTIO N ACCORDED IS THUS IRREGULAR AND HAS VITIATED THE PROCEEDINGS WHICH ARE BAD IN LAW. IN THIS CONNECTION WE MAKE FOLLOWING SUBMISSIONS: 1. THE APPELLANT SUBMITS THAT A PLAIN PERUSAL OF THE A BOVE PROVIDED REASONS FOR RE- OPENING ARE THE ONLY REASONS THAT CAN BE CONSIDERED WHEN THE FORMATION OF BELIEF OF INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT IS CHALLENGED. THE HONBLE BOMBAY HIGH COURT IN PRASHANT S. JOSHI V. ITO [2010] 324 ITR 154 (BOM) HELD THAT THE BASIC POSTULATE WHICH UNDERLINES SECTION 147 I S THE FORMATION OF THE BELIEF BY THE ASSESSING OFFICER THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 7 ASSESSMENT FOR ANY ASSESSMENT YEAR. THE ASSESSING O FFICER MUST HAVE REASON TO BELIEVE THAT SUCH IS THE CASE BEFORE HE PROCEEDS TO ISSUE A NOTICE UNDER SECTION 147. THE REASONS WHICH ARE RECORDED BY THE ASSESSIN G OFFICER FOR REOPENING AN ASSESSMENT ARE THE ONLY REASONS WHICH CAN BE CONSID ERED WHEN THE FORMATION OF THE BELIEF IS IMPUGNED. THE RECORDING OF REASONS DI STINGUISHES AN OBJECTIVE FROM A SUBJECTIVE EXERCISE OF POWER. THE REQUIREMENT OF RE CORDING REASONS IS A CHECK AGAINST ARBITRARY EXERCISE OF POWER. FOR IT IS ON T HE BASIS OF THE REASONS RECORDED AND ON THOSE REASONS ALONE THAT THE VALIDITY OF THE ORDER REOPENING THE ASSESSMENT IS TO BE DECIDED. THE REASONS RECORDED W HILE REOPENING THE ASSESSMENT CANNOT BE ALLOWED TO GROW WITH AGE AND I NGENUITY, BY DEVISING NEW GROUNDS IN REPLIES AND AFFIDAVITS NOT ENVISAGED WHE N THE REASONS FOR REOPENING AN ASSESSMENT WERE RECORDED. THE PRINCIPLE OF LAW, THE REFORE, IS WELL-SETTLED THAT THE QUESTION AS TO WHETHER THERE WAS REASON TO BELIEVE, WITHIN THE MEANING OF SECTION 147 THAT INCOME HAS ESCAPED ASSESSMENT, MUS T BE DETERMINED WITH REFERENCE TO THE REASONS RECORDED BY THE ASSESSING OFFICER. THE REASONS WHICH ARE RECORDED CANNOT BE SUPPLEMENTED BY AFFIDAVITS. THE IMPOSITION OF THAT REQUIREMENT ENSURES AGAINST AN ARBITRARY EXERCISE O F POWERS UNDER SECTION 148. A CLEAR READING OF THE REASONS RECORDED FOR RE-OPEN ING OF ASSESSMENT IN CASE OF THE APPELLANT SHOWS THAT THERE IS NO ALLUSION AT AL L TO THE APPELLANT IN THE RECORDED REASONS. THERE IS HENCE NO TANGIBLE BASIS PROVIDED IN THE RECORDED REASONS THAT SHOW THAT THERE MAY BE INCOME THAT HAS ESCAPED ASSESSMENT IN THE HANDS OF THE APPELLANT IN THE CASE DUE TO THE FAILU RE OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HI S ASSESSMENT. 2. THE APPELLANT SUBMITS THAT IN 3I INFOTECH LTD. V. ACIT [2010] 329 ITR 257 (BOMBAY) , THE HONBLE BOMBAY HIGH COURT HELD THAT THE VALI DITY OF THE REOPENING OF THE ASSESSMENT HAS TO BE DETERMINED WITH REFEREN CE TO THE REASONS WHICH HAVE WEIGHED WITH THE ASSESSING OFFICER. THOSE NORM S CANNOT BE ADDED TO OR SUPPORTED ON A BASIS WHICH WAS NOT PRESENT TO THE M IND OF THE ASSESSING OFFICER ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 8 WHEN HE ISSUED THE NOTICE TO REOPEN. THE APPELLANT SUBMITS THAT THE MIND OF THE ASSESSING OFFICER WHILE RE-OPENING ARE GIVEN IN THE REASONS RECORDED FOR RE- OPENING. WHEN THESE REASONS THEMSELVES ARE VAGUE AN D AMBIGUOUS, THEN THE SUPPLYING OF FURTHER REASONS WHILE DISPOSING THE OB JECTIONS TAKEN BY THE APPELLANT ARE AGAINST THE WORDS AND THE SPIRIT OF T HE JUDGEMENT OF THE HONBLE APEX COURT IN THE CASE OF GKN DRIVESHAFTS (SUPRA) THAT HOLDS FIELD ON THE SUBJECT. IT IS CLEAR THAT, WHILE JUSTIFYING THE REOPENING OF AN ASSESSMENT, THE ASSESSING OFFICER IS BOUND TO PRIMA FACIE CONSIDER ONLY THE R ECORDED REASONS FOR RE- ASSESSMENT. 3. THE HONBLE BOMBAY HIGH COURT IN THE CASE OF HINDUSTAN LEVER LTD. V. R.B. WADKAR [2004] 268 ITR 332 (BOMBAY HC) OBSERVED THAT IT IS NEEDLESS TO MENTION THAT THE REASONS ARE REQUIRED TO BE READ AS THEY WE RE RECORDED BY THE ASSESSING OFFICER. NO SUBSTITUTION OR DELETION IS PERMISSIBLE . NO ADDITIONS CAN BE MADE TO THOSE REASONS. NO INFERENCE CAN BE ALLOWED TO BE DR AWN BASED ON REASONS NOT RECORDED. IT IS FOR THE ASSESSING OFFICER TO DISCLO SE AND OPEN HIS MIND THROUGH REASONS RECORDED BY HIM. HE HAS TO SPEAK THROUGH HI S REASONS. IT IS FOR THE ASSESSING OFFICER TO REACH TO THE CONCLUSION AS TO WHETHER THERE WAS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRUL Y ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT FOR THE CONCERNED ASSESSMENT YEAR. I T IS FOR THE ASSESSING OFFICER TO FORM HIS OPINION. IT IS FOR HIM TO PUT HIS OPINI ON ON RECORD IN BLACK AND WHITE. THE REASONS RECORDED SHOULD BE CLEAR AND UNAMBIGUOU S AND SHOULD NOT SUFFER FROM ANY VAGUENESS. THE REASONS RECORDED MUST DISCL OSE HIS MIND. REASONS ARE THE MANIFESTATION OF MIND OF THE ASSESSING OFFICER. THE REASONS RECORDED SHOULD BE SELF-EXPLANATORY AND SHOULD NOT KEEP THE ASSESSE E GUESSING FOR THE REASONS. REASONS PROVIDE LINK BETWEEN CONCLUSION AND EVIDENC E. THE REASONS RECORDED MUST BE BASED ON EVIDENCE. THE ASSESSING OFFICER, I N THE EVENT OF CHALLENGE TO THE REASONS, MUST BE ABLE TO JUSTIFY THE SAME BASED ON MATERIAL AVAILABLE ON RECORD. HE MUST DISCLOSE IN THE REASONS AS TO WHICH FACT OR MATERIAL WAS NOT DISCLOSED BY THE ASSESSEE FULLY AND TRULY NECESSARY FOR ASSESSME NT OF THAT ASSESSMENT YEAR, SO ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 9 AS TO ESTABLISH VITAL LINK BETWEEN THE REASONS AND EVIDENCE. THAT VITAL LINK IS THE SAFEGUARD AGAINST ARBITRARY REOPENING OF THE CONCLU DED ASSESSMENT. THE REASONS RECORDED BY THE ASSESSING OFFICER CANNOT BE SUPPLEM ENTED BY FILING AFFIDAVIT OR MAKING ORAL SUBMISSION, OTHERWISE, THE REASONS WHIC H WERE LACKING IN THE MATERIAL PARTICULARS WOULD GET SUPPLEMENTED, BY THE TIME THE MATTER REACHES TO THE COURT, ON THE STRENGTH OF AFFIDAVIT OR ORAL SUB MISSIONS ADVANCED. THIS JUDGMENT OF THE HONBLE BOMBAY HIGH COURT HAS BEEN FOLLOWED IN THE CASE OF HONBLE HIGH COURT OF GAUHATI IN CIT V. SHIV SHAKTI FLOUR MILLS PVT. LTD. [2010] 327 ITR 430 (GAUHATI) , HONBLE CALCUTTA HIGH COURT IN ANIL KUMAR BHANDARI V. JCIT [2007] 294 ITR 222 (CALCUTTA) AND THE HONBLE GUJRAT HIGH COURT IN AAYOJAN DEVELOPERS V. ITO [2011] 335 ITR 235 (GUJRAT) WHICH OBSERVED THAT WHAT TRANSPIRES FROM THE JUDICIAL PRONOUNCEMENTS, AS DIS CUSSED ABOVE, IS THAT THERE MUST BE A LIVE LINK BETWEEN THE MATERIALS ON WHICH CONCLUSIONS ARE BASED AND THE ACTUAL CONCLUSION OF THE ASSESSING OFFICER IN FORMA TION OF HIS BELIEF THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. SU CH REASON MUST BE HELD IN GOOD FAITH AND CANNOT BE PRETENCE AND ALSO CANNOT B E BASED ON EXTRANEOUS OR IRRELEVANT CONSIDERATION. UNLESS THE ASSESSING OFFI CER HAS 'REASON TO BELIEVE' AND SUCH REASON IS MATERIAL AND RELEVANT TO FORM A BELI EF THAT THERE IS AN ESCAPED ASSESSMENT, NO ACTION UNDER SECTION 147 OF THE ACT CAN BE TAKEN. THE APPELLANT SUBMITS THAT THE REASONS RECORDED FOR REOPENING OF THE ASSESSMENT DO NOT MAKE OUT ANY SUCH LIVE LINK BETWEEN THE MATERIALS ON W HICH CONCLUSIONS ARE BASED AND THE ACTUAL CONCLUSION OF THE ASSESSING OFFICER IN F ORMATION OF HIS BELIEF THAT ANY INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT. 4. THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF EAST COAST COMMERCIAL CO. LTD. V. ITO [1981] 128 ITR 326 (CAL.) OBSERVED THAT THE RECORDING OF REASONS IN OUR OPINION IS NOT AN IDLE FORMALITY BUT IS A MANDATORY REQUIREMENT OF THE STATUTE CASTING A DUTY AND OBLIGATION ON THE ITO TO RECORD HIS REASONS FOR ISSUING A NOTICE FOR REOPENING AN ASSESSMENT AND THE CBDT OR THE COM MISSIONER, AS THE CASE MAY ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 10 BE, BEING SATISFIED THAT IT IS A FIT CASE FOR ISSUE OF SUCH NOTICE SOLELY ON THE BASIS OF THE SAID REASONS RECORDED, ACCORDS ITS SANCTION TO THE ISSUE OF SUCH NOTICE. THIS JUDGEMENT OF THE HONBLE CALCUTTA HIGH COURT HAS BE EN FOLLOWED BY THE HONBLE ITAT JAIPUR BENCH IN THE CASE OF SATYAM FOOD SPECIA LITIES (P) LTD VS. DCIT [2015] 68 SOT 449 (JAIPUR TRIB) WHILE EXAMINING THE PROVIS IONS OF 153C OF THE INCOME TAX ACT WHICH OBSERVED THAT SATISFACTION NOTE ITSELF M UST DISPLAY REASONS OR BASIS OF CONCLUSION THAT THE DOCUMENTS BELONG TO A PERSON OT HER THAN THE SEARCHED PERSON. IT IS ALSO SETTLED LAW THAT THE SATISFACTIO N NOTE HAS TO BE READ AS IT IS WITHOUT ANY ADDITION, SUBTRACTION OR WITH THE HELP OF ALLIED DOCUMENTS. IT CANNOT BE SUPPLEMENTED OR SUPPLANTED. THE APPELLANT SUBMIT S THAT IT IS NOT THE CASE OF THE ASSESSING OFFICER THAT THE DOCUMENTS FOUND WITH SHRI MADAN MOHAN GUPTA BELONGED TO THE APPELLANT. IN FACT THERE IS A CATEG ORICAL CONCLUSION IN THE ASSESSMENT ORDER THAT THE PRIMARY ONUS TO EXPLAIN T HE CONTENTS OF THE LOOSE PAPERS WAS THAT OF SHRI MADAN MOHAN GUPTA. 5. THE HONBLE HIGH COURT OF RAJASTHAN IN THE CASE OF CIT V. UTTAM CHAND NAHAR [2007] 295 ITR 403 (RAJASTHAN) OBSERVED THAT THE INITIAL SATISFACTION ABOUT THE ESCAPEMENT OF INCOME, WHICH REQUIRES INITIATION OF PROCEEDINGS UNDER SECTION 147, MUST BE OF THE ASSESSING OFFICER HIMSELF. IF THE CONDITIONS UNDER SECTION 151(1) OR (2) REQUIRE THE SATISFACTION OF THE DEPUT Y COMMISSIONER OR THE CHIEF COMMISSIONER OR THE COMMISSIONER, AS THE CASE MAY B E, BEFORE ISSUANCE OF SUCH NOTICE, SUCH SATISFACTION MUST ALSO BE ONLY ON THE BASIS OF THE REASONS RECORDED BY THE ASSESSING OFFICER AND NOT DE HORS IT. THAT IS T O SAY THE SATISFACTION RECORDED BY THE ASSESSING OFFICER MUST BE ENDORSED BY THE DEPUT Y COMMISSIONER, THE CHIEF COMMISSIONER OR THE COMMISSIONER, AS THE CASE MAY B E, BEFORE THE ASSESSING OFFICER ASSUMES JURISDICTION. SATISFACTION INDEPEND ENT OF THE REASONS RECORDED BY THE ASSESSING OFFICER IS NOT ENVISAGED. THIS CLEARL Y INDICATES THAT FOUNDATION OF INITIATING THE PROCEEDINGS IS THE REASON TO THE BEL IEF HELD BY THE ASSESSING OFFICER. REASONS FOR HOLDING SUCH BELIEF ARE TO BE RECORDED IN WRITING BY THE ASSESSING OFFICER. THE SATISFACTION OF THE DEPUTY COMMISSIONE R OR THE COMMISSIONER, AS THE ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 11 CASE MAY BE, HAS TO BE ONLY ABOUT THE FITNESS OF TH E CASE TO BE SUBJECT TO PROCEEDING BY REASSESSMENT UNDER SECTION 148 ONLY O N THE BASIS OF THE REASONS RECORDED BY THE ASSESSING OFFICER. SIMILARLY, IN THE CASE OF CIT V. SHIV RATTAN SONI [2008] 217 CTR 222 (RAJASTHAN) THE HONBLE HIGH COURT OBSERVED THAT IF THE REASON S RECORDED BEFORE INITIATING PROCEEDING UNDER S. 148 IT NEED RECORD T O FIND SOME MATERIAL WHICH COULD BE RELATED BY COURT TO SATISFACTION OF AO, DO NOT SATISFY THE TEST OF AN HONEST BELIEF OR SATISFACTION REACHED BY AO ABOUT E SCAPEMENT OF THE INCOME BEFORE ISSUANCE OF NOTICE. IT REMAINS AN ACTION MOR E ON SUSPICION. LAW REQUIRES WHERE AO HAS REASON TO BELIEVE AND DOES NOT REST AT HIS REASON TO SUSPECT THAT INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT. SUCH A STAND CANNOT BE SUPPORTED ON SPECIOUS PLEA THAT ONE CAN MAKE A SEAR CH OR ENQUIRY INTO ANY MATERIAL ON RECORD WHICH IS RELEVANT FOR THE ASSESS MENT YEAR FOR HOLDING THE BELIEF WHETHER INCOME FOR PARTICULAR ASSESSMENT YEAR HAS E SCAPED ASSESSMENT. IF THAT WERE SO, LEGISLATURE WOULD NOT HAVE PROVIDED AN IMP ORTANT SAFEGUARD AGAINST UNNECESSARY HARASSMENT THAT REASONS FOR SUCH BELIEF MUST BE RECORDED BEFORE ISSUANCE OF NOTICE, AND THE EXISTENCE OF SUCH SATIS FACTION HAS TO BE SUPPORTED WITHIN THE PARAMETER OF REASONS AND NOT OUTSIDE. ON E DOES NOT HAVE TO REMEMBER THE CONTENTS OF MATERIAL THAT HAVE GONE IN TO CONSIDERATION BUT MATERIAL THAT HAS GONE INTO CONSIDERATION MUST HAVE SPECIFIC REFERENCE SO THAT CHECK ON ULTRA VIRES EXERCISE OF POWERS CAN BE EFFECTIVELY EXERCISED TH ROUGH JUDICIAL REVIEW. THE APPELLANT SUBMITS THAT RE-ASSESSMENT PROCEEDING S CANNOT BE INITIATED TO MAKE A PROTECTIVE ASSESSMENT. IT IS A FACT THAT THE ADDITION MADE IN THE HANDS OF THE APPELLANT OF RS. 4,15,32,446/- IS MADE ON A PRO TECTIVE BASIS. A BELIEF THAT INCOME HAS ESCAPED ASSESSMENT IS THE SIN QUA NON FO R THE INITIATION OF PROCEEDINGS U/S 147. A PROTECTIVE ASSESSMENT IS MAD E WHEN THE DEPARTMENT HAS A DOUBT TO THE PERSON WHO IS OR WILL BE DEEMED TO B E THE RECEIPT OF THE INCOME. BELIEF BY ITSELF IS ABSENCE OF DOUBT. A BELIEF TH AT INCOME HAS ESCAPED ASSESSMENT ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 12 IS THE ANTITHESIS OF HAVING A DOUBT AS TO THE PERSO N TO WHO THE IMPUGNED INCOME BELONGS TO. BY NO STRETCH OF IMAGINATION CAN THE TW O SAID TO BE CONGRUOUS TO ANY DEGREE. THIS PROPOSITION OF THE APPELLANT FINDS FAV OUR IN THE JUDGEMENT OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF DHLF VENTURE CAPITAL FUND V. ITO [2013] 358 ITR 471 (BOMBAY) WHICH ELUCIDATED THAT A PROTECTIVE ASSESSMENT IS REGARDED AS BEING PROTECTIVE BECAUSE IT IS AN ASSES SMENT WHICH IS MADE EX ABUNDANT CAUTELA WHERE THE DEPARTMENT HAS A 'DOUBT AS TO THE PERSON WHO IS OR WILL BE DEEMED TO BE IN RECEIPT OF THE INCOME'. A D EPARTMENTAL PRACTICE, WHICH HAS GAINED JUDICIAL RECOGNITION, HAS EMERGED WHERE IT APPEARS TO THE ASSESSING OFFICER THAT INCOME HAS BEEN RECEIVED DURING THE RE LEVANT ASSESSMENT YEAR, BUT WHERE IT IS NOT CLEAR OR UNAMBIGUOUS AS TO WHO HAS RECEIVED THE INCOME. SUCH A PROTECTIVE ASSESSMENT IS CARRIED OUT IN ORDER TO EN SURE THAT INCOME MAY NOT ESCAPE TAXATION ALTOGETHER PARTICULARLY IN CASES WH ERE THE REVENUE HAS TO BE PROTECTED AGAINST THE BAR OF LIMITATION. BUT EQUALL Y WHILE A PROTECTIVE ASSESSMENT IS PERMISSIBLE A PROTECTIVE RECOVERY IS NOT ALLOWED . HOWEVER, SUCH AN EXERCISE WHICH IS PERMISSIBLE IN THE CASE OF A REGULAR ASSES SMENT MUST NECESSARILY YIELD TO THE DISCIPLINE OF THE STATUTE WHERE RECOURSE IS SOU GHT TO BE TAKEN TO THE PROVISIONS OF SECTION 148. PROTECTIVE ASSESSMENTS H AVE EMERGED AS A MATTER OF DEPARTMENTAL PRACTICE WHICH HAS FOUND JUDICIAL RECO GNITION. ANY PRACTICE HAS TO NECESSARILY YIELD TO THE RIGOUR OF A STATUTORY PROV ISION. HENCE, WHEN RECOURSE IS SOUGHT TO BE TAKEN TO THE PROVISIONS OF SECTION 148 , THERE HAS, NECESSARILY TO BE THE FULFILMENT OF THE JURISDICTIONAL REQUIREMENT TH AT THE ASSESSING OFFICER MUST HAVE REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSE SSMENT. TO ACCEPT THE CONTENTION OF THE REVENUE IN THE PRESENT CASE WOULD BE TO ALLOW A REOPENING OF AN ASSESSMENT UNDER SECTION 148 ON THE GROUND THAT THE ASSESSING OFFICER IS OF THE OPINION THAT A CONTINGENCY MAY ARISE IN FUTURE RESULTING AN ESCAPEMENT OF INCOME. THAT WOULD, IN OUR VIEW, BE WHOLLY IMPERMIS SIBLE AND WOULD AMOUNT TO A REWRITING OF THE STATUTORY PROVISION. IT FURTHER WE NT ON TO OBSERVE THAT THE ENTIRE EXERCISE IS ONLY CONTINGENT ON A FUTURE EVENT AND A CONSEQUENCE THAT MAY ENSURE ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 13 UPON THE DECISION OF THE TRIBUNAL, THAT AGAIN IF TH E TRIBUNAL WERE TO HOLD AGAINST THE REVENUE. A REOPENING OF AN ASSESSMENT UNDER SEC TION 148 CANNOT BE JUSTIFIED ON SUCH A BASIS. THERE HAS TO BE A REASON TO BELIEV E THAT INCOME HAS ESCAPED ASSESSMENT. 'HAS ESCAPED ASSESSMENT' INDICATES AN E VENT WHICH HAS TAKEN PLACE. TAX LEGISLATION CANNOT BE REWRITTEN BY THE REVENUE OR THE COURT BY SUBSTITUTING THE WORDS 'MAY ESCAPE ASSESSMENT' IN FUTURE. WRITIN G LEGISLATION IS A CONSTITUTIONAL FUNCTION ENTRUSTED TO THE LEGISLATUR E. THE APPELLANT SUBMITS THAT BY MAKING A PROTECTIVE A SSESSMENT, THE ASSESSING OFFICER HAS DEMONSTRATED THAT THERE EXIST S A DOUBT ABOUT THE TAXABILITY OF SAID AMOUNT IN THE HANDS OF THE APPELLANT. THIS DOUBT MANIFESTS ITSELF IN PARA 20. WHERE THE ASSESSING OFFICER HAS DISCUSSED THAT THE PAPERS WERE FOUND IN THE POSSESSION OF SHRI MADAN MOHAN GUPTA AND IT WAS THE PRIMARY ONUS OF SHRI MADAN MOHAN GUPTA TO EXPLAIN THE SAME. THEREFORE, A N ADDITION OF RS. 4,15,32,446 /- HAS BEEN MADE IN THE HANDS OF SHRI G UPTA AND A PROTECTIVE ADDITION TO SAFEGUARD THE INTEREST OF THE REVENUE H AS BEEN MADE IN THE HANDS OF THE APPELLANT WHICH BY ITSELF HAS NO NEXUS FOR THE REASONS FURNISHED FOR REOPENING OF THE ASSESSMENT. HENCE, NO ACTUAL ADDITION HAS BE EN MADE ON THE REASON FOR WHICH THE ASSESSMENT ITSELF WAS REOPENED ON BASIS O F AS THE ADDITION IS MADE ONLY TO SAFEGUARD THE INTEREST OF THE REVENUE. THE HONB LE BOMBAY HIGH COURT IN CIT V. JET AIRWAYS (I) LTD. [2011] 331 ITR 236 (BOMBAY) HELD THAT IF THE ASSESSING OFFICER DOES NOT ASSESS THE INCOME FOR WHICH REASONS WERE R ECORDED U/S 147 FOR REOPENING OF ASSESSMENT, HE CANNOT ASSESS ANY OTHER INCOME U/S 147.THIS RATIO OF THE HONBLE BOMBAY HIGH COURT IS BASED UPON THE RAT IO OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. SHRI RAM SINGH [2008] 306 ITR 343 . THE LD. CIT (A) AFTER CONSIDERING ABOVE SUBMISSION S AND ALSO ON RELYING ON THE JUDGEMENT OF JURISDICTION HIGH COURT IN CASE OF DHADDA EXPORTS VS. I.T.O. (2015) 58 TAXMANN.COM 176 (RAJ.) (P. B. PAGE 136-140). HELD THE PROCEEDINGS INITIAT ED BY A.O. U/S 147 AS UNSUSTAINABLE IN LAW WHICH IS CO RRECT IN LAW. THE ASSESSEE HUF ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 14 ALSO RELIES ON THE RECENT JUDGEMENT OF HON'BLE BENC H IN CASE OF NAVRATTAN KOTHARI VS. ACIT (ITA NO. 425/JP/2017) ORDER DATED 13-12-2017 WHEREIN EXACTLY SAME FACTS WERE INVOLVED AND AFTER CONSIDERING THE VARIO US JUDICIAL PRONOUNCEMENTS ON THE ISSUE HELD THE ISSUE OF NOTICE U/S 147 WITHOUT JURISDICTION. THE ASSESSEE RELIES ON THE SAID JUDGEMENT ALSO. COPY OF WHICH IS PLACED ON P.B. PAGE 141-184). THE ISSUE IS ALSO COVERED FROM THE SAID JUDGEMENT OF HO N'BLE BENCH. IN LIGHT OF THE ABOVE SUBMISSIONS AND THE FACTS THA T SHARE PURCHASE TRANSACTION WAS DULY DISCLOSED IN THE BALANCE SHEET FILED DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS AND ACCORDINGLY THERE WAS NO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS. THE AP PELLANT SUBMITS THAT THE REASSESSMENT PROCEEDINGS HAD NO LEGS TO STAND UPON AND WERE BAD IN LAW. THE LD AR OF THE ASSESSEE HAS ALSO FILED A SUPPLEMEN TARY WRITTEN SUBMISSIONS REGARDING GROUND NO. 1 OF THE APPEAL, WH EREIN HE HAS SUBMITTED AS UNDER: A) NO FAILURE ON THE PART OF ASSESSEE TO DISCLOSE F ULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR ASSESSMENT. AS ALREADY SUBMITTED THAT EARLIER THE ASSESSMENT WA S COMPLETED U/S 143 (3) AT THE TOTAL INCOME OF RS. 5,66,74,000/- ON 09-10-2009 . THE LD. A.O. SOUGHT TO REOPEN THE SAID ASSESSMENT COMPLETED U/S 143 (3) BY ISSUE OF NOTICE U/S 148. IN THIS CONNECTION WE WOULD LIKE TO BRING YOUR KIND ATTENTION TO FIRST PROVISO OF SECTION 147, REPRODUCED HEREUNDER: PROVIDED THAT WHERE AN ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 143 OR THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSESSMENT Y EAR, NO ACTION SHALL BE TAKEN UNDER THIS SECTION AFTER THE EXPIRY OF FOUR YEARS F ROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEABLE TO TA X HAS ESCAPE4D ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REASON OF THE FAILURE O N THE PART OF THE ASSESSEE TO ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 15 MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB- SECTION (1) OF SECTION 142 OR SECTION 148 OR TO DIS CLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT FOR THAT ASSESSM ENT YEAR. IT IS SUBMITTED THAT PROCEEDING UNDER SECTION 147 R .W.S. 148 CAN BE INITIATED IF TWO CONDITIONS ARE SATISFIED, NAMELY (1) THE ASSESS ING OFFICER MUST HAVE REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED A SSESSMENT AND: (2) HE MUST HAVE REASON TO BELIEVE THAT SUCH INCOME HAS ESCAPED ASSESSMENT BY REASON OF OMISSION OR FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT, FOR THAT ASSESSMENT YEAR. BOTH THE CONDITION SHOULD BE CUMULATIVELY SATISFIED TO CONFER JURISDICTION TO ASSESSING OFFICER TO INITIATE THE ASSESSMENT PROCEEDING. COMPARING THE ABOVE SAID CONDITIONS FOR REOPENING T HE ASSESSMENT VIS--VIS THE ASSESSEES IT MAY BE MENTIONED THAT : B) THERE IS NO FAILURE ON THE PART OF THE ASSESSEE COMPANY TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSE SSMENT, FOR THAT ASSESSMENT YEAR. THE ASSESSMENT CANNOT BE REOPENED MERELY BECAUSE SU BSEQUENTLY THE ASSESSING OFFICER CHANGES HIS OPINION OR SOME OTHER OFFICER T AKES A DIFFERENT VIEW. A DECISION IS RIGHT OR WRONG IS NONE OF THE CONCERN O F THE SUBSEQUENT OFFICER. (REFER SITA WORLD TRAVEL (INDIA) LTD. VS. CIT (2005) 274 I TR 186) . THE HONBLE SUPREME COURT IN CASE OF KELVINATOR OF INDIA LTD. (2010) 320 ITR 561 (SC) HELD THAT THE CONCEPT OF CHANGE OF OPINION ON THE PART OF THE A SSESSING OFFICER TO REOPEN AN ASSESSMENT DOES NOT STAND OBLITERATED AFTER THE SUB STITUTION OF SECTION 147 OF THE INCOME-TAX ACT, 1961, BY THE DIRECT TAX LAWS (AMEND MENT) ACTS, 1987 AND 1989. AFTER THE AMENDMENT, THE ASSESSING OFFICER HAS TO H AVE REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT, BUT THIS DOES NOT IM PLY THAT THE ASSESSING OFFICER CAN REOPEN AN ASSESSMENT ON MERE CHANGE OF OPINION. THE CONCEPT OF CHANGE OF OPINION MUST BE TREATED AS AN IN-BUILT TEST TO CHECK THE ABUSE OF ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 16 POWER. IN A RECENT JUDGEMENT BY FULL BENCH OF DELHI HIGH COURT IN CASE OF CIT VS. USHA INTERNATIONAL LTD. (2012) 348 ITR 485 THE COURT HELD THAT THE EXPRESSION CHANGE OF OPINION POSTULATES FORMATION OF OPINION AND THEN A CHANGE THEREOF. IN THE CONTEXT OF SECTION 147 IT IMPLIES THAT THE A SSESSING OFFICER SHOULD HAVE FORMED AN OPINION AT THE FIRST INSTANCE, I.E. IN TH E PROCEEDINGS UNDER SECTION 143(3) AND NOW BY INITIATION OF THE REASSESSMENT PR OCEEDING, THE ASSESSING OFFICER PROPOSES OR WANTS TO TAKE A DIFFERENT VIEW. THE SAME VIEW WERE HELD BY DELHI HIGH COURT IN CIT VS. EICHER LTD. (2007) 297 ITR 310 (DEL). IN A RECENT JUDGMENT THE HON'BLE GUJARAT HIGH COURT HAS ADJUDIC ATED ON SIMILAR FACTS IN THE CASE OF M/S GANESH HOUSING CORPORATION LTD. VS. DCI T (2013) 350 ITR 131 (GUJ.) IN THE REASONS RECORDED BY LD. A.O. THERE IS NO WHI SPER THAT DUE TO FAILURE ON THE PART OF ASSESSEE TO DISCLOSE FULLY AND TRULY AL L MATERIAL FACTS NECESSARY FOR ASSESSMENT THE INCOME HAS ESCAPED ASSESSMENT AND, THEREFORE THE NOTICE ISSUED U/S 148 IS WRONG AND BAD IN LAW AND LD. A.O. CIT (A) HAS RIGHTLY QUASHED THE REOPENING OF ASSESSMENT. C) FURTHER REASSESSMENT PURSUANT TO MATERIAL FOUND IN SEARCH CAN BE DONE THROUGH RECOURSE TO SECTION 153C ONLY AND NOT BY IN VOKING PROVISIONS OF SECTION 147/148. THE PROVISIONS OF SECTION 153C ARE OVER-RI DING IN NATURE AND CONTAIN NON OBSTANTE CLAUSE FOR SECTIONS 139, 147, 148, 149, 151 AND 15 3. IT IS SUBMITTED THAT SECTION 147 AND 153C ARE NOT I NTERCHANGEABLE BUT ARE MUTUALLY EXCLUSIVE SECTIONS. IT IS NOT THE CHOICE O F THE REVENUE TO INVOKE EITHER OF THE TWO SECTIONS AT ITS WHIMS. THE SCOPE OF THE TWO SECTIONS HAVE BEEN LEGISLATED DIFFERENTLY WITH A DEFINITE PURPOSE. RELIANCE IS PLACED ON THE FOLLOWING JUDICIAL PRONOU NCEMENTS, THE RELEVANT EXTRACTS OF WHICH HAVE BEEN SET OUT HEREUNDER FOR T HE SAKE OF READY REFERENCE:- ARUN KUMAR KAPOOR [2011] 140 TTJ 249 (AMRITSAR) ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 17 HEAD NOTES :SECTION 153C, READ WITH SECTION 148, O F THE INCOME-TAX ACT, 1961 SEARCH AND SEIZURE ASSESSMENT OF INCOME OF ANY OTHER PERSON ASSESSMENT YEAR 2006-07 A SEARCH WAS CONDUCTED UN DER SECTION 132 IN CASE OF T LTD., DURING COURSE OF WHICH CERTAIN IN CRIMINATING DOCUMENTS WERE ALLEGEDLY SEIZED DEPUTY COMMISSIONER INTIMAT ED ASSESSING OFFICER OF ASSESSEE ABOUT SEIZURE OF CERTAIN DOCUMENTS PERTAIN ING TO ASSESSEE DURING SEARCH AND ENCLOSED COPY OF THOSE DOCUMENTS REQUEST ING HIM TO TAKE APPROPRIATE ACTION UNDER SECTION 153C/148 THEREUP ON, ASSESSING OFFICER HAVING INITIATED REASSESSMENT PROCEEDINGS UNDER SEC TION 148, PASSED AN ASSESSMENT ORDER ASSESSEE TOOK AN ADDITIONAL GROU ND OF APPEAL TO EFFECT THAT REASSESSMENT PROCEEDINGS INITIATED BY ASSESSIN G OFFICER UNDER SECTION 148 WERE ILLEGAL AND VOID AB-INITIO COMMISIONER ( APPEALS) HELD THAT ASSESSING OFFICER SHOULD HAVE ISSUED NOTICE UNDER S ECTION 153C AND SHOULD HAVE FRAMED ASSESSMENT UNDER SECTION 153C, READ WIT H SECTION 153A HE FURTHER HELD THAT SINCE ASSESSING OFFICER HAD NOT F OLLOWED PROCEDURE LAID DOWN UNDER SECTION 153C, NOTICE ISSUED UNDER SECTIO N 148 AND REASSESSMENT PROCEEDINGS BECAME ILLEGAL AND VOID AB INITIO WHETHER ON FACTS, COMMISSIONER (APPEALS) WAS JUSTIFIED IN SETT ING ASIDE REASSESSMENT PROCEEDINGS HELD YES [IN FAVOUR OF ASSESSEE]. G. KOTESWARA RAO [2015] 64 TAXMANN.COM 159 (VISAKHA PATNAM TRIB.) .CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE C ASE AND ALSO APPLYING THE RATIOS OF THE ABOVE MENTIONED DECISIONS, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER, HAS NO JURISDIC TION TO ISSUE NOTICE U/S 148 OF THE ACT TO REOPEN THE ASSESSMENTS IN RESPECT OF THOSE SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR IN WHICH SEARCH IS CONDUCTED OR REQUISITION IS MADE. THE PERIOD UNDER CONSIDERATION FALLS WITHIN THE EXCLUSIVE DOMAIN OF SECTION 153A. IN THE INSTANT CASE, SINCE THE ASSESSMENT IS MADE CONSEQUENT TO SEARCH IN ANOTHER CASE, THE ASSESSING OFFICER IS BOUND TO ISSUE NOTICE U/S 153C AND THERE AFTER PROCEED TO ASSESS OR REASSESS TOTAL INCOME UNDER SECTION 153A OF THE ACT . THE ASSESSING OFFICER, INSTEAD OF COMPLYING WITH THE PROVISIONS OF SECTION 153C, PROCEEDED WITH THE REASSESSMENT UNDER SECTION 147/148 WHICH IS NOT APPLICABLE TO SEARCH CASES. THEREFORE, THE IMPUGNED ASSESSMENT ORDER PAS SED U/S 143 (3), R.W.S. 147 OF THE INCOME TAX ACT, 1961 IS ILLEGAL, ARBITRA RY AND WITHOUT ANY JURISDICTION. HENCE, THE ASSESSMENT ORDER DATED 31- 12-2010 PASSED U/S 143 (3) R.W.S. 147 IS QUASHED. RAJAT SHUBRA CHATTERJI, ITA NO. 2430/DEL/2015, ITAT DELHI BENCH . ON HAVING GONE THROUGH THE DECISIONS CITED ABOV E ESPECIALLY THE DECISION OF AMRITSAR BENCH IN THE CASE OF I.T.O. V S. ARUN KUMAR KAPOOR (SUPRA), WE FIND THAT IN THAT CASE AS IN THE PRESEN T CASE BEFORE US, ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 18 REASSESSMENT WAS INITIATED ON THE BASIS OF INCRIMIN ATING MATERIAL FOUND IN SEARCH OF THIRD PARTY AND THE VALIDITY OF THE SAME WAS CHALLENGED BY THE ASSESSEE BEFORE THE LEARNED CIT (APPEALS) AND THE L EARNED CIT (APPEALS) VITIATED THE PROCEEDINGS. THE SAME WAS QUESTIONED B Y THE REVENUE BEFORE THE ITAT AND THE ITAT AFTER DISCUSSING THE CASES OF THE PARTIES AND THE RELEVANT PROVISIONS IN DETAILS HAS COME TO THE CONC LUSION THAT IN THE ABOVE SITUATION, PROVISIONS OF SEC. 153C WERE APPLICABLE WHICH EXCLUDES THE APPLICATION OF SECTIONS 147 AND 148 OF THE ACT. THE ITAT HELD THE NOTICE ISSUED UNDER SEC. 148 AND PROCEEDINGS UNDER SEC. 14 7 AS ILLEGAL AND VOID AB INTIO. IT WAS HELD THAT ASSESSING OFFICER HAVING NO T FOLLOWED PROCEDURE UNDER SEC. 153C, REASSESSMENT ORDER WAS RIGHTLY QUA SHED BY THE LEARNED CIT (APPEALS). IN THE PRESENT CASE BEFORE US, IT IS AN ADMITTED FACT, AS ALSO EVIDENT FROM THE REASONS RECORDED AND THE ASSESSMEN T ORDER THAT THE INITIATION OF REOPENING PROCEEDINGS WAS MADE BY THE ASSESSING OFFICER ON THE BASIS OF INFORMATION RECEIVED FROM THE DIRECTOR ATE OF INCOME-TAX (INV.) ON THE BASIS OF SEARCH & SEIZURE OPERATION CONDUCTE D AT THE PREMISES OF ROCK LAND GROUP OF CASES AND THE DOCUMENTS RELATED TO THE ASSESSEE FOUND DURING THE COURSE OF SEARCH WERE MADE AVAILABLE TO THE ASSESSING OFFICER OF THE PRESENT ASSESSEE. WE THUS RESPECTFULLY FOLLOWIN G THE DECISION OF CO- ORDINATE BENCH OF THE ITAT IN THE CASE OF ACIT VS. ARUN KAPUR 140 TTJ 249 (AMRITSAR) HOLD THAT PROVISIONS OF SEC. 153C OF THE ACT WERE APPLICABLE IN THE PRESENT CASE FOR FRAMING THE ASSESSMENT, IF ANY , WHICH EXCLUDES THE APPLICATION OF SEC. 147 OF THE ACT, HENCE, NOTICE I SSUED UNDER SEC. 148 OF THE ACT AND ASSESSMENT FRAMED IN FURTHERANCE THERETO UN DER SEC. 147 READ WITH SECTION 143 (3) OF THE ACT ARE VOID AB INITIO. FURTHER RELIANCE IS PLACED ON ASHOK KUMAR BATAWNI T ALWANDI, KOTA VS. CIT [D.B. INCOME TAX APPEAL NO. 204/2004 DATED 10.1.2017 OF H ON'BLE RAJASTHAN HIGH COURT] HOLD THAT AUTHORITY WHO IS ISSUING THE NOTIC E MUST BE AWARE OF THE ACT AND MUST CONSTRUE THE PROVISION STRICTLY. THE ASSESSEE ALSO RELIES ON THE RECENT JUDGEMENT OF HON'BLE BENCH IN CASE OF NAVRATTAN KOTHARI VS. ACIT (ITA NO. 425/JP/2017) ORDER DATED 13-12-2017 WHEREIN EXACTLY ON SAME FACTS WERE INVOLVED AND AFT ER CONSIDERING THE VARIOUS JUDICIAL PRONOUNCEMENTS ON THE ISSUE HELD AS UNDER: - THEREFORE, IN CONJOINT READING OF PROVISIONS OF SE CTION 153A, 153C AND 147/148 OF THE ACT AS WELL AS A CONSISTENT VIEW TAKEN BY THIS TRIBUNAL IN A SERIES OF DECISION CITED (SUPRA) WE H OLD THAT THE ASSESSMENT OR REASSESSMENT OF INCOME OF THE PERSON OTHER THAN ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 19 SEARCH PERSONS BASED ON SEIZED MATERIAL CAN BE ONLY BE MADE U/S 153C R.W.S. 153A AND THE PROVISIONS OF SECTION 147/ 148 OF THE ACT ARE NOT APPLICABLE IN SUCH CASES. NO CONTRARY DECISION HAS BEEN BROUGHT TO OUR NOTICE. ACCORDINGLY, WE HOLD THAT INITIATION OF PROCEEDINGS U/S 147/148 BY THE A.O. TO REASSESS THE INCOME IS ILLEG AL BEING WITHOUT JURISDICTION AND CONSEQUENTLY THE REASSESSMENT ORDE R PASSED U/S 147 R.W.S. 143 (3) IS ALSO ILLEGAL AND VOID AB INITIO A ND IS LIABLE TO BE QUASHED. THUS THE ISSUE OF NOTICE U/S 148 AND CONSEQUENT REA SSESSMENT ARE ILLEGAL AND VOID AB INITIO AND LD. CIT (A) HAS RIGHTLY QUASHED THE REASSESSME NT PROCEEDINGS U/S 148. 7. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. THE AS SESSEE HUF FILED ORIGINAL RETURN OF INCOME ON 27/10/2007 DECLARING T OTAL INCOME OF RS. 5,66,74,000/-. THE ASSESSMENT WAS COMPLETED U/S 143(3 ) OF THE ACT AT THE RETURNED INCOME ON 09/10/2009. SUBSEQUENTLY, A SEARCH AND SEIZURE OPERATION U/S 132 OF THE ACT WAS CONDUCTED IN THE CA SE OF SHRI RAJENDRA JAIN GROUP AND HIS ASSOCIATES MEMBERS ON 23/3/2013. DURING THE COURSE OF SEARCH AND SEIZURE ACTION, STATEMENT OF SHRI MAD AN MOHAN GUPTA WAS RECORDED. WHO HAD EXPLAINED THE VARIOUS DOCUMENTS F OUND AND SEIZED DURING THE SEARCH OPERATION. CONSEQUENTLY, THE ASSE SSING OFFICER PROPOSED TO REOPEN THE ASSESSMENT OF THE ASSESSEE T O ASSESSEE OWN MONEY PAYMENT FOR PURCHASE OF LAND AT VILLAGE CHAIN PURA, BEHIND THE ENTERTAINMENT PARADISE (EP). THE ASSESSING OFFICER A CCORDINGLY ISSUED A ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 20 NOTICE U/S 148 OF THE ACT DATED 21/3/2014 BY RECORD ING THE REASONS FOR REOPENING THE ASSESSMENT AS UNDER: A SEARCH & SEIZURE OPERATION WAS CARRIED OUT AT TH E RESIDENTIAL PREMISE OF SHRI MADAN MOHAN GUPTA AT VRINDAVAN, DIGGI ROAD, SANGANE R ROAD, JAIPUR AND ALSO SURVEY PROCEEDINGS WERE CARRIED OUT AT THE BUSINESS PREMISE OF SHRI MADAN MOHAN GUPTA AT A30 SARSWATI COLONY, SANGANER, JAIPU R WHEREBY CERTAIN INCRIMINATING DOCUMENTS WERE FOUND AND SEIZED/ IMPO UNDED. DURING THE COURSE OF STATEMENTS, SHRI MADAN MOHAN G UPTA SUBMITTED THAT A TRANSACTION OF LAND AT VILLAGE CHAINPURA BEHIND E.P . WAS CARRIED OUT IN WHICH THE SAID LAND WAS PURCHASED BY SHRI RAJENDRA KUMAR JAIN THROUGH SHRI MADAN MOHAN GUPTA. THE DEAL WAS FINALIZED AT RS. 12,43,27 ,000/- OUT OF WHICH DISCOUNT OF 1% WAS ALLOWED FOR EARLY REGISTRATION O F LAND. THEREFORE RS. 12,30,84,000/- WAS NET PAYABLE TO THE SELLERS. THIS LAND WAS PURCHASED DURING THE A.Y. 2006-07 AN D SOLD TO K.G. KOTHARI, PRITHVIRAJ ROAD, C-SCHEME, JAIPUR AND SHRI VIMAL CHAND SURANA IN THE MONTH OF MARCH, 200 7. THIS SALE TRANSACTION WAS FINALIZED FOR RS. 20,83,39,232/-. IN THE LIGHT OF STATEMENTS OF SHRI MAD A N MOHAN GUPTA, STATEMENT OF SHRI VIMAL CHAND SURANA WERE RECORDED ON OATH ON 16.08.2013. S HRI VIMAL CHAND SURANA HAD SUBMITTED THAT HE DID NOT PURCHASE ANY LAND FRO M SHRI MADAN MOHAN GUPTA NOR ANY PAYMENT WAS MADE TO SHRI MADAN MOHAN GUPTA. HOWEVER, SHRI VIMAL CHAND SURANA ACCEPTED THAT HE HAD PURCHASED 1 334 EQUI TY SHARES OF M/S SHRI KALYAN BUILMART PVT. LTD. IN THE NAME OF HIS H UF OUT OF WHICH 667 EQUITY SHARES WERE PURCHASED FROM SHRI MADAN MOHAN GUPTA A ND 667 EQUITY SHARES FROM SMT. SHASHIKALA GUPTA W/O SHRI MADAN MOHAN GUP TA. IN THIS COMPANY, LAND NEAR E.P. IS AN ASSET. THESE EQUITY SHARES WER E PURCHASED DURING MARCH, 2007 AND RS. 67,700/- WERE PAID TO SHRI MADAN MOHAN GUPTA ON 23.06.2007 ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 21 AND RS. 67,700/- WERE PAID TO SMT. SHASHIKALA GUPTA ON 19.04.2007, ON ACCOUNT OF SALE CONSIDERATION OF THESE SHARES. FROM THE ABOVE IT IS CLEAR THAT LAND BEHIND E.P. WA S PURCHASED IN THE GUISE OF SALE OF SHARES OF SHRI KALYAN BUILMART PVT. LTD., I N WHICH VIMAL CHAND SURANA HUF HAS 20% SHAREHOLDING. SINCE, THE SHARE OF LAND IN VIMAL CHAND SURANA HUF IS 20%, HIS SHARE IN SALE COMES OUT TO BE 41667846/-. HENCE, ON THE BASIS OF ABOVE I HAVE REASON TO BELIEVE THAT INCOME OF RS. 41532446/- [41667846-135 499/-] HAS ESCAPED ASSESSMENT. SINCE IT IS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE HIS TRUE INCOME, HENCE PERMISSION FOR TAKING ACTION U/S 147 MAY KINDLY BE ACCORDED IN THE CASE OF VIMAL CHAND SURANA HUF FOR THE A.Y. 200 7-08, THE CASE HAS ALREADY BEEN COMPLETED U/S 143(3) OF THE I.T. ACT, 1961. THUS, THE ASSESSING OFFICER HAS PROCEEDED ON THE PRE MISES THAT THE ASSESSEE ALONGWITH SHRI K.G. KOTHARI AND SHRI VIMAL CHAND SURANA (INDIVIDUAL) HAD INVESTED THE MONEY IN PURCHASE OF LAND IN THE NAME OF M/S SHRI KALYAN BUILMART PVT. LTD. THE ASSESSING OFF ICER IN THE REASSESSMENT HAS ASSESSED THE INCOME OF RS. 4,15,32 ,446/- ON PROTECTIVE BASIS AS THE SUBSTANTIVE ADDITION WAS MADE IN THE HA NDS OF SHRI MADAN MOHAN GUPTA. THERE IS NO DISPUTE THAT THE ASSESSING OFFICER PROPOSED TO REASSESS THE INCOME ON ACCOUNT OF TRANSACTION OF PU RCHASE OF LAND. HOWEVER, THE SAID LAND WAS PURCHASED BY M/S SHRI KALY AN BUILMART PVT. LTD. ON 24/08/2006. THEREAFTER THE ASSESSEE ALONGWITH SHRI NAVRATAN KOTHARI AND SHRI VIMAL CHAND SURANA (INDIVIDUAL) PU RCHASED THE SHARES ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 22 OF M/S SHRI KALYAN BUILMART PVT. LTD. FROM SHRI MAD AN MOHAN GUPTA AND HIS WIFE SMT. SHASHI KALA GUPTA. IT IS EVIDENT FROM THE RECORD THAT THE ASSESSEE HAS DULY DECLARED THE TRANSACTION OF PURCH ASE OF SHARES OF M/S SHRI KALYAN BUILMART PVT. LTD. IN ITS BOOKS OF ACCO UNT AND ALSO IN THE RETURN OF INCOME ORIGINALLY FILED ON WHICH THE ASSES SMENT WAS COMPLETED U/S 143(3) OF THE ACT ON 09/10/2009. THEREFORE, THE REOPENING OF THE ASSESSMENT TO ASSESSEE THE CONSIDERATION ALLEGEDLY PAID BY THE ASSESSEE FOR PURCHASE OF LAND IS CONTRARY TO THE RECORD AND ACTUAL FACTS OF TRANSACTION OF PURCHASE OF THE LAND IN QUESTION IN THE NAME OF M/S SHRI KALYAN BUILMART PVT. LTD. AND NOT IN THE NAME OF AS SESSEE. FURTHER, IT IS ALSO NOT IN DISPUTE THAT SHRI MADAN MOHAN GUPTA AND HIS WIFE SMT. SHASHI KALA GUPTA WERE THE PROMOTERS AND SHARE HOLDE RS OF M/S SHRI KALYAN BUILMART PVT. LTD. PRIOR TO THE PURCHASE OF SHARES BY THE ASSESSEE, THE ASSESSING OFFICER HAS NOT BROUGHT ON RECORD ANY MATERIAL TO SHOW THAT M/S SHRI KALYAN BUILMART PVT. LTD. HAS ANY CON NECTION WITH THE ASSESSEE. WE FURTHER NOTE THAT AN IDENTICAL ISSUE O F REOPENING OF THE ASSESSMENT IN THE CASE OF SHRI NAVRATTAN KOTHARI VS . ACIT IN ITA NO. 425/JP/2017 HAS BEEN CONSIDERED AND DECIDED BY THIS TRIBUNAL VIDE ORDER DATED 13/12/2017 IN PARAGRAPHS NO. 6 AND 7, WHICH IS REPRODUCED AS UNDER: ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 23 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. THE MATTER REVOLVES AROUND THE TRANSACTION OF PURCHASE AND SALE OF LAND SITUATED AT VILLAGE CHAINPURA, TEHSIL SANGANER (BEHIND OF ENTERTAINMENT PARADISE) JAIPUR. THE SAID LAND WAS PURCHASED BY M/ S SHRI KALYAN BUILDMART PVT. LTD. ON 24.08.2006. THEREAFTER THE ASSESSEE P URCHASED 8,000 SHARES M/S SHRI KALYAN BUILDMART PVT. LTD. FROM SHRI MADAN MOHAN GUPTA AND HIS WIFE SMT. SHASHI KALA GUPTA. THERE IS NO DISPUTE TH AT THIS TRANSFER OF PURCHASE OF SHARES OF M/S SHRI KALYAN BUILDMART PVT . LTD. WAS DULLY REFLECTED IN THE BOOKS OF ACCOUNTS AS ON 31.03.2008 AND ALSO BROUGHT BEFORE THE ASSESSING OFFICER IN THE COURSE OF INITIATION ASSES SMENT COMPLETED U/S 143(3) R.W.S. 153A ON 31.03.2013. THEREAFTER THE AO PROPOSED TO REOPEN THE ASSESSMENT TO ASSESS THE CONSIDERATION PAID BY THE ASSESSEE FOR ALLEGED PURCHASE OF LAND BY ISSUING NOTICE U/S 148 ON 25.03 .2014. THE AO RECORDED THE REASONS FOR REOPENING OF THE ASSESSMENT AS REPR ODUCE AT PAGE 4 OF THE ASSESSMENT ORDER ARE AS UNDER:- DURING THE COURSE SEARCH AND SEIZURE OPERATION IN THE CASE OF RAJENDRA JAIN GROUP DOS 23-05-2013 AND SURVEY PROCEEDINGS AT THE BUSINESS PREMISES OF SHRI MADAN MOHAN GUPTA, CERTAIN INCRIMINATING DOCUMENTS WERE FOUND AND SEIZED WHICH WERE INVENTORIES AS EXHIBIT 1 TO 5 OF ANNEXUR E-AS AND EXHIBIT 1 TO 8 OF ANNEXURE- A. THE DOCUMENTS FOUND AND SEIZED FROM TH E RESIDENCE AND BUSINESS PREMISE OF SHRI MADAN MOHAN GUPTA DURING THE COURSE OF SEARCH PROCEEDINGS REVEALED THAT ON VARIOUS PAGE OF EXHIBIT- 1,2 & 5 O F ANNEXURE-A AS WELL AS EXHIBIT-1 OF ANNEXURE-AS, SOME DATE WISE AMOUNTS HA VE BEEN WRITTEN IN THE NAME OF KGK. THESE TRANSACTIONS NOTED ON PAGE NO. 28,43,69 AND 73 OF EXHIBIT- 1 OF ANNEXURE-A TOTAL UP TO RS. 14,24,12,650/-. THE ASSESSEE HAS FAILED TO SATISFACTORILY EXPLAIN THE TRANSACTIONS RECORDED ON THIS PAGE. I HAVE THUS REASON TO BELIEVE THAT INCOME TO THE EXTENT OF RS. 14,24,1 2,650/- HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147OF THE I.T. ACT, 1961. THUS, IT IS CLEAR THAT THE BASIS OF REOPENING OF TH E ASSESSMENT IS THE SEIZED MATERIAL FOUND DURING THE COURSE OF SEARCH AND SEIZ URE OPERATION IN THE CASE OF RAJENDRA JAIN GROUP AND THE STATEMENT OF SHRI MA DAN MOHAN GUPTA RECORDED U/S 132(4) AND 131 OF THE ACT. THE ASSE SSING OFFICER ANALYZED THE ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 24 STATEMENT AND THE SEIZED MATERIAL FOR HIS SATISFACT ION AS RECORDED IN PARAS 4 AND 5 OF THE ASSESSMENT ORDER AS UNDER:- 4. IN HIS STATEMENTS, RECORDED DURING THE COURSE O F SEARCH/POST SEARCH PROCEEDINGS, SHRI MADAN MOHAN GUPTA SUBMITTED THAT THE FOLLOWING PAGERS OF VARIOUS EXHIBITS ARE RELATED TO LAND TRANSACTIONS A T CHAINPURA BEHIND ENTERTAIN PARADISE, JAIPUR. SR. ANNEXURE NO. & EXHIBIT NO. PAGE NO. FOUND/SEIZED FROM 1 ANNEXURE A EXHIBIT - 1 15 TO 24,27,38,43,44, AND 69 TO 74 RESIDENTIAL PREMISES 2 ANNEXURE A EXHIBIT - 2 47 AND BACK SIDE OF 48, 50 TO 54 RESIDENTIAL PREMISES 3 A NNEXURE A EXHIBIT - 5 1 TO 77 RESIDENTIAL PREMISES 4 ANNEXURE AS EXHIBIT - 1 1 TO 3,7,9,10 OFFICE PREMISES 5. FURTHER IN THE STATEMENTS OF SHRI MADAN MOHAN GU PTA, HE SUBMITTED THAT ON THE ABOVE PAGE, DETAILS W.R.T. A LAND TRANSACTIONS AT VILLAGE CHAINPURA BEHIND ENTERTAINMENT PARADISE, JAIPUR HAS BEEN RECORDED WH ICH WAS PURCHASE BY SHRI RAJENDRA KUMAR JAIN RESIDENT OF D-25, LAL BAHADUR NAGAR, JAIPUR, THROUGH HIM I.E. SHRI MADAN MOHAN GUPTA. THE DEAL WAS FINALIZED AT RS. 12,43,27,000/- OUT OF WHICH DISCOUNT OF RS. 1% WAS ALLOWED FOR REGISTR ATION OF LAND. THEREFORE, RS. 13,30,84,000/- WERE NET PAYABLE TO THE SELLER AND T HE DETAILS OF THE SAME HAVE BEEN RECORDED ON PAGE NO. 15-18 OF EXHIBIT-1 OF ANN EXURE-A, FOUND AND SEIZED FROM HIS RESIDENCE. LATER ON THIS LAND WAS SOLD TO SHRI K.G. KOTHARI. SHRI MADAN MOHAN GUPTA FURTHER SUBMITTED THAT THIS LAND WAS PU RCHASED IN THE NAME OF M/S KALYAN BUILDMART PVT. LTD. IN WHICH HE WAS A DI RECTOR ALONG WITH HISWIFE SMT. SHASHIKALA GUPTA. THIS LAND WAS PURCHASED DURI NG THE YEAR 2006-07 AND SOLD TO K G. KOTHARI, PRITHVIRAJ ROAD, C-SCHEME, JA IPUR AND SHIR VIMAL CHAND SURANA IN THE MONTH OF MARCH, 2007 AND THE DETAILS OF THE SAME HAVE BEEN RECORDED ON PAGE NOS. 27 & 28 OF EXHIBIT OF ANNEXUR E-A. DURING THE COURSE OF STATEMENT, SHRI MADAN MOHAN GUPTA ADMITTED THAT THE AMOUNTS MENTIONED AGAINST DATES HAVE BEEN RECORDED IN CODED FORM SUCH AS RS. 1.00 CRORE HAVE BEEN WRITTEN AS 1=00 AND RS. 50.00 LACS HAVE BEEN W RITTEN AS .50. THIS SALE TRANSACTIONS WERE FINALIZED FOR RS. 20,83,39,232/- AND THE PAYMENTS TO THE SELLERS WERE MADE THROUGH SHRI RAMESHWAR PRASAD SHA RMA RESIDENT OF BARKAT NAGAR, TONK PHATAK, JAIPUR. SHRI MADAN MOHAN GUPTA FURTHER ADMITTED THAT HE GOT RS. 8.00 LACS AS HIS REIMBURSEMENT FROM THIS LA ND TRANSACTION. ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 25 THUS IT REVEALS FROM THE ASSESSMENT ORDER THAT AFTE R THE INITIAL ASSESSMENT U/S 143(3) R.W.S. 153A THE AO GOT THE ALLEGED INCRI MINATING MATERIAL IN THE SHAPE OF DIARY AND TRANSACTIONS RECORDED THEREIN FO UND AND SEIZED IN THE SEARCH AND SEIZURE OPERATION IN CASE OF RAJENDRA JA IN GROUP. ACCORDINGLY, THE AO PROCEEDED TO REASSESS THE INCOME OF THE ASSE SSEE U/S 147 OF THE ACT. THE ENTIRE DECISIONS OF THE AO TO REASSESS THE INCO ME OF THE ASSESSEE IS BASED ON THE SEIZED MATERIAL AND STATEMENT OF SHRI MADAN MOHAN GUPTA RECORDED U/S 132(4) OF THE ACT FOR WHICH THE SPECI FIC REMEDY IS PROVIDED U/S 153C OF THE ACT. FOR READY REFERENCE WE QUOTE S ECTION 153C AS UNDER:- 153C. 79 [(1)] 80 [NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139 , SECTION 147 , SECTION 148 , SECTION 149 , SECTION 151 AND SECTION 153 , WHERE THE ASSESSING OFFICER IS SATISFIED THAT, ( A ) ANY MONEY, BULLION, JEWELLERY OR OTH ER VALUABLE ARTICLE OR THING, SEIZED OR REQUISITIONED, 81 BELONGS TO; OR ( B ) ANY BOOKS OF ACCOUNT OR DOCUMENTS, SEIZED OR REQUIS ITIONED, PERTAINS OR PERTAIN TO, OR ANY INFORMATION CONTAINED THEREIN, R ELATES TO, A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTI ON 153A , THEN, THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS, SEIZED OR REQUISITI ONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON] 82 [AND THAT ASSESSING OFFICER SHALL PROCEED AGAINST EACH SUCH O THER PERSON AND ISSUE NOTICE AND ASSESS OR REASSESS THE INCOME OF THE OTHER PERS ON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A , IF, THAT ASSESSING OFFICER IS SATISFIED THAT THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIO NED HAVE A BEARING ON THE DETERMINATION OF THE TOTAL INCOME OF SUCH OTHER PER SON 82A [ FOR SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR REL EVANT TO THE PREVIOUS YEAR IN WHICH SEARCH IS CONDUCTED OR REQUISITION IS MADE AN D ] FOR THE RELEVANT ASSESSMENT YEAR OR YEARS REFERRED TO IN SUB-SECTION (1) OF SEC TION 153A ] :] 83 [ PROVIDED THAT IN CASE OF SUCH OTHER PERSON, THE REFERENCE T O THE DATE OF INITIATION OF THE SEARCH UNDER SECTION 132 OR MAKING OF REQUISITION UNDER SECTION 132A IN THE SECOND PROVISO TO 84 [SUB-SECTION (1) OF] SECTION 153A SHALL BE CONSTRUED AS REFERENCE TO THE DATE OF RECEIVING THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED BY THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON :] 85 [ PROVIDED FURTHER THAT THE CENTRAL GOVERNMENT MAY BY RULES 86 MADE BY IT AND PUBLISHED IN THE OFFICIAL GAZETTE, SPECIFY THE CLAS S OR CLASSES OF CASES IN RESPECT OF SUCH OTHER PERSON, IN WHICH THE ASSESSING OFFICER S HALL NOT BE REQUIRED TO ISSUE NOTICE FOR ASSESSING OR REASSESSING THE TOTAL INCOM E FOR SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 26 SEARCH IS CONDUCTED OR REQUISITION IS MADE 86A [ AND FOR THE RELEVANT ASSESSMENT YEAR OR YEARS AS REFERRED TO IN SUB-SECTION (1) OF SECTI ON 153A ] EXCEPT IN CASES WHERE ANY ASSESSMENT OR REASSESSMENT HAS ABATED.] 87 [(2) WHERE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED AS REFERRED TO IN SUB-SECTION (1) HAS OR HAVE BEEN REC EIVED BY THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AFTER TH E DUE DATE FOR FURNISHING THE RETURN OF INCOME FOR THE ASSESSMENT YEAR RELEVANT T O THE PREVIOUS YEAR IN WHICH SEARCH IS CONDUCTED UNDER SECTION 132 OR REQUISITION IS MADE UNDER SECTION 132A AND IN RESPECT OF SUCH ASSESSMENT YEAR ( A ) NO RETURN OF INCOME HAS BEEN FURNISHED BY SUCH OTHE R PERSON AND NO NOTICE UNDER SUB-SECTION (1) OF SECTION 142 HAS BEEN ISSUED TO HIM, OR ( B ) A RETURN OF INCOME HAS BEEN FURNISHED BY SUCH OTHER PERSON BUT NO NOTICE UNDER SUB-SECTION (2) OF SECTION 143 HAS BEEN SERVED AND LIMITATION OF SERVING THE NOTICE UNDER SUB-SECTION (2) OF SECTION 143 HAS EXPIRED, OR ( C ) ASSESSMENT OR REASSESSMENT, IF ANY, HAS BEEN MADE, BEFORE THE DATE OF RECEIVING THE BOOKS OF ACCOUNT O R DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED BY THE ASSESSING OFFICER HAVING JURIS DICTION OVER SUCH OTHER PERSON, SUCH ASSESSING OFFICER SHALL ISSUE THE NOTICE AND A SSESS OR REASSESS TOTAL INCOME OF SUCH OTHER PERSON OF SUCH ASSESSMENT YEAR IN THE MA NNER PROVIDED IN SECTION 153A . THIS SECTION BEGINS WITH NON-OBSTANTE CLAUSE AND TH EREFORE, HAS AN OVERRIDING EFFECT ON THE SECTIONS 147&148 OF THE AC T. AS PER THE SCHEME AND OBJECT OF SECTION 153C R.W.S 153A THE AO HAS NO DIS CRETION OR CHOICE TO INVOKE THE PROVISIONS OF SECTION 147/148 INSTEAD OF SECTION 153C R.W.S. 153A OF THE ACT. ONCE THE CASE OF REASSESSMENT IS MADE O UT BY THE AO WHICH FALLS IN THE PREVIEW OF SPECIFIC PROVISIONS OF SECTION 15 3C OF THE ACT, THE AO CANNOT RESORT TO INVOKE THE PROVISIONS OF SECTION 1 47/148 OF THE ACT TO ASSESSEE OR REASSESS INCOME OF THE ASSESSEE. THE AC TION OF THE AO TO INITIATE THE PROCEEDINGS UNDER SECTION 147/148 OF THE ACT VI TIATES THE ENTIRE REASSESSMENT PROCEEDINGS AND THE ASSESSMENT ORDER. ONCE, THE AO IS SATISFIED THAT THE DOCUMENTS SEIZED BELONG TO THE P ERSONS OTHER THAN THE SEARCHED PERSON, THE ASSESSING OFFICER SHALL PROCEE D AGAINST SUCH OTHER PERSONS AND ISSUED NOTICE U/S 153C AND ASSESSEE OR REASSESS INCOME OF SUCH OTHER PERSONS IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A OF THE ACT. ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 27 THEREFORE, IT IS MANDATORY FOR THE AO TO PROCEED U/ S 153C IF HE IS SATISFIED THAT THE SEIZED MATERIAL REVEALS THE INCOME OF SUCH OTHER PERSONS TO BE ASSESSED OR REASSESSED. THE AMRITSAR BENCH OF THIS TRIBUNAL IN CASE OF ITO VS. ARUM KUMAR KAPOOR (SUPRA) WHILE DECIDING AN IDE NTICAL ISSUE OF VALIDITY OF INITIATION OF PROCEEDINGS U/S 147/148 ON THE BAS IS OF SEIZED MATERIAL HAS HELD IN PARAS 7.2 AND 8 AS UNDER:- 7.2 . THE UNDISPUTED FACTS ARE THAT A SEARCH WAS CONDUC TED UNDER S. 132 OF THE ACT IN THE CASE OF M/S. TODAY HOMES & INFRASTRUCTUR E (P.) LTD. ON 28TH MARCH, 2006, DURING THE COURSE OF WHICH CERTAIN INCRIMINAT ING DOCUMENTS WERE ALLEGEDLY SEIZED. IT IS ALSO A MATTER OF RECORD THA T THE DY. CIT, CENTRAL CIRCLE-22, NEW DELHI INTIMATED THE AO OF THE ASSESSEE ABOUT SE IZURE OF CERTAIN DOCUMENTS PERTAINING TO THE ASSESSEE DURING SEARCH AND ENCLOS ED COPY OF THOSE DOCUMENTS REQUESTING HIM TO TAKE APPROPRIATE ACTION UNDER S. 153C/148 OF THE ACT. IT IS AFTER THAT THAT DURING THE COURSE OF APPELLATE PROC EEDINGS BEFORE THE CIT(A) THE ASSESSEE TOOK AN ADDITIONAL GROUND OF APPEAL TO THE EFFECT THAT THE REASSESSMENT PROCEEDINGS INITIATED BY THE AO UNDER S. 148 ARE ILLEGAL AND VOID AB INITIO. IN THE INSTANT CASE, THE LEARNED CI T(A) HAS CORRECTLY OBSERVED THAT THE AO SHOULD HAVE ISSUED NOTICE UNDER S. 153C OF T HE ACT AND SHOULD HAVE FRAMED THE ASSESSMENT UNDER S. 153C R/W S. 153A OF THE ACT. SEC. 153C OF THE ACT READS AS UNDER : '153C. NOTWITHSTANDING ANYTHING CONTAINED IN S. 139 , S. 147, S. 148, S. 149, S. 151 AND S. 153, WHERE THE AO IS SATISFIED THAT ANY MONEY, BULLION OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DO CUMENTS SEIZED OR REQUISITIONED BELONGS OR BELONG TO A PERSON OTHER T HAN THE PERSON REFERRED TO IN S. 153A, THEN THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED SHALL BE HANDED OVER TO THE AO HAVING JURISDICTION OVER SUCH OTHER PERSON AND THAT AO SHALL PROCEED AGAINST EACH SUCH OTHER PERSON AND ISSUE SUCH OTHER PERSON NOTICE AND ASSESS OR REASSESS INC OME OF SUCH OTHER PERSON IN ACCORDANCE WITH THE PROVISIONS OF S. 153A.' 8. ON A PERUSAL OF THE ABOVE PROVISIONS, IT WOULD BE CLEAR THAT THE PROVISIONS OF S. 153C OF THE ACT WERE APPLICABLE, WHICH SUPERSEDE S THE APPLICABILITY OF PROVISIONS OF SS. 147 AND 148 OF THE ACT. AS WE HAV E ALREADY NOTED HEREINABOVE THAT THE DOCUMENTS WERE SEIZED DURING THE SEARCH UN DER S. 132 OF THE ACT AND THE SAME WERE SENT TO THE ASSESSEE'S AO AT AMRITSAR BY THE OFFICER AT DELHI IN OUR VIEW, THE LEARNED CIT(A) HAS CORRECTLY OBSERVED THAT ONLY THE PROVISION IN WHICH ANY ASSESSMENT COULD BE MADE AGAINST THE ASSE SSEE IN THE IT ACT WAS S. 153C R/W S. 153A OF THE ACT. IT IS ALSO APPARENT FR OM THE RECORD THAT THE OFFICER AT DELHI HAS MENTIONED IN HIS LETTER THAT THE NECES SARY ACTION MAY BE TAKEN AS ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 28 PER LAW UNDER S. 153C/148 OF THE ACT. HENCE, NOTICE ISSUED UNDER S. 148 OF THE ACT AND PROCEEDINGS UNDER S. 147 OF THE ACT BY THE AO ARE ILLEGAL AND VOID AB INITIO. IN VIEW OF THE PROVISIONS OF S. 153C OF THE ACT, S. 147/148 STANDS OUSTED. IN THE INSTANT CASE, THE PROCEDURE LAID DOWN UNDER S. 153C HAS NOT BEEN FOLLOWED BY THE AO AND, THEREFORE, ASSESSMENT HAS B ECOME INVALID. WE ALSO OBSERVE THAT THE CIT(A) WAS JUSTIFIED IN FOLLOWING THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF MANISH MAHESHW ARI V. ASSTT. CIT [2007] 289 ITR 341 / 159 TAXMAN 258 WHEREIN IT HAS BEEN HELD THAT IF THE PROCEDURE LAID DOWN IN S. 158BD IS NOT FOLLOWED, BL OCK ASSESSMENT PROCEEDINGS WOULD BE ILLEGAL. THE CIT(A) HAS CORRECTLY OBSERVED THAT THE PROVISIONS OF S. 153C ARE EXACTLY SIMILAR TO THE PROVISIONS OF S. 158BD O F THE ACT IN BLOCK ASSESSMENT PROCEEDINGS. THUS, CONSIDERING THE ENTIRE FACTS AND THE CIRCUMSTANCES OF THE PRESENT CASE, WE HOLD THAT THE CIT(A) WAS FULLY JUS TIFIED IN QUASHING THE REASSESSMENT ORDER. WE ALSO DO NOT FIND ANY MERIT I N THE SUBMISSIONS OF THE LEARNED DEPARTMENTAL REPRESENTATIVE THAT DURING THE COURSE OF SEARCH, IT WAS FOUND AT PREMISES OF M/S. TODAY HOMES & INFRASTRUCT URE (P.) LTD. PERTAINING TO M/S. P.R. INFRASTRUCTURE LTD. AND NOT THE ASSESSEE. IN THIS REGARD, WE MAY POINT OUT THAT THE CONTENTION RAISED BY THE LEARNED DEPAR TMENTAL REPRESENTATIVE IS FACTUALLY INCORRECT AND CONTRARY TO THE AVAILABLE R ECORDS OF SEIZED DOCUMENTS SPECIFICALLY MENTIONED IN THE ASSESSMENT ORDER DT. 30TH DEC, 2008. IN VIEW OF THE ABOVE FACTUAL DISCUSSION, WE DO NOT FIND ANY ME RIT AND SUBSTANCE IN THE CONTENTION OF THE LEARNED DEPARTMENTAL REPRESENTATIVE. THEREFORE, WE UPHOLD THE ORDER OF THE CIT(A) AND DISMISS THE GROUND NOS. 1 TO 4 OF THE APPEAL. A SIMILAR VIEW WAS TAKEN BY THE VISAKHAPATNAM BENCH OF THIS TRIBUNAL IN CASE OF G. KOTESWARA RAO VS. DCIT (SUPRA) IN PARA 1 1 TO 17 AS UNDER:- 11. A CAREFUL STUDY OF SECTION 153A TO 153C AND ALSO T HE CIRCULAR ISSUED BY THE CBDT EXPLAINING THE PROCEDURE OF ASSESSMENT IN SEAR CH CASES, IT SHOWS THAT THESE ARE SEPARATE PROVISIONS INDEPENDENT OF OTHER PROVISIONS RELATING TO REASSESSMENT, BECAUSE OF THE NON ABSTANTE CLAUSE BE GINS WITH THE SAID SECTIONS. THE LANGUAGE USED IN THESE SECTIONS, I.E. 'NOTWITHS TANDING ANYTHING CONTAINED' IN SECTION 139, SECTION 147, SECTION 148, SECTION 1 49, SECTION 151 AND SECTION 153 MADE IT CLEAR THAT PROVISIONS OF THESE SECTIONS ARE NOT MADE APPLICABLE TO THE ASSESSMENTS COVERED BY THE PROVISIONS OF SECTIO N 153A. PRIOR TO THE INTRODUCTION OF THESE THREE SECTIONS, THERE WAS A S EPARATE CHAPTER XIV -B OF THE ACT, BY SECTION 158BC TO 158BE WHICH GOVERNS THE SE ARCH ASSESSMENTS WHICH IS POPULARLY KNOWN AS BLOCK ASSESSMENT. THE EARLIER PR OVISIONS PROVIDES FOR SINGLE ASSESSMENT TO BE MADE IN RESPECT OF UNDISCLOSED INC OME OF BLOCK PERIOD CONSISTING OF 10 ASSESSMENT YEARS IMMEDIATELY PRECE DING THE ASSESSMENT YEAR IN WHICH SEARCH TOOK PLACE AND THE BROKEN PERIOD OF UP TO THE DATE OF SEARCH ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 29 WAS ALSO INCLUDED IN THE BLOCK PERIOD. AFTER THE IN TRODUCTION OF NEW SECTIONS, I.E. SECTION 153A TO 153C, THE SINGLE BLOCK ASSESSMENT C ONCEPT WAS DONE WAY WITH THE NEW SCHEME OF ASSESSMENT OF SEARCH CASES WHERE THE ASSESSING OFFICER IS TO ASSESS OR REASSESS THE TOTAL INCOME OF EACH OF THE ASSESSMENT YEARS FALLING WITHIN THE PERIOD OF SIX ASSESSMENT YEARS IMMEDIATE LY PRECEDING THE ASSESSMENT YEAR IN WHICH THE SEARCH IS CONDUCTED. T HEREFORE, UNDER THE NEW SCHEME, THE ASSESSING OFFICER IS REQUIRED TO EXERCI SE THE NORMAL ASSESSMENT POWERS IN RESPECT OF THE PREVIOUS YEAR IN WHICH THE SEARCH TOOK PLACE. FROM THESE FACTS, ONE THING IS CLEARLY EMERGED THAT BOTH I.E. EARLIER CONCEPT OF BLOCK ASSESSMENT AND THE NEW SCHEME OF ASSESSMENT IS SEPA RATE PROVISIONS CREATED FOR ASSESSMENT OF SEARCH CASES WHERE THE SEARCH IS CONDUCTED U/S 132 OR REQUISITION WAS MADE U/S 132A OF THE ACT. 12. UNDER THE PROVISIONS OF SECTION 147, THE ASSESSING OFFICER IS HAVING POWER TO RE-OPEN THE ASSESSMENT, IF HE IS OF THE OPINION THA T THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. BEFORE DOING SO, THE AS SESSING OFFICER SHOULD SATISFY HIMSELF THAT, THERE IS MATERIAL WHICH SUGGE STS THAT THERE IS AN ESCAPEMENT OF INCOME. THE AO CAN EXERCISE THESE POW ERS WITH A REASONABLE BELIEF COUPLED WITH SOME MATERIAL WHICH SUGGEST THE ESCAPEMENT OF INCOME. ONCE THE CONDITIONS PRECEDENT FOR ASSUMPTION OF JUR ISDICTION TO COMMENCE THE REASSESSMENT PROCEEDINGS, HE HAS TO CROSS THE HURDL ES ATTACHED WITH REASSESSMENT BY WAY REASONS FOR REOPENING OF ASSESS MENT, TIME LIMIT FOR ISSUE OF NOTICE AND PROVISION FOR OBTAINING SANCTION OF H IGHER AUTHORITY IN CERTAIN CIRCUMSTANCES. UNDER THE PROVISIONS OF SECTION 153A TO 153C THESE HURDLES ARE CLEARED BY USING THE NON ABSTANTE CLAUSE IN THE SAI D SECTION. IN OTHER WORDS, UNDER THE NEW PROVISIONS OF SECTION 153A, THE AO IS NOT REQUIRED TO SATISFY THESE CONDITIONS BEFORE ISSUE OF NOTICE. THE ONLY REQUIRE MENT IS THAT THERE SHOULD BE A SEARCH ACTION U/S 132 OR BOOKS OF ACCOUNT, OTHER DO CUMENTS OR ANY OTHER ASSET ARE REQUISITIONED UNDER SECTION 132A. THEREFORE, WE ARE OF THE OPINION THAT THOUGH, THE ASSESSING OFFICER FROM BOTH SECTIONS EM POWERED TO TAX THE INCOME ESCAPED FROM TAX, BOTH ARE WORKS IN A DIFFERENT SIT UATIONS, I.E. SECTION 147 COMES IN TO OPERATION WHERE THERE IS AN ESCAPEMENT OF INCOME CHARGEABLE TO TAX AND SECTION 153A COMES IN TO OPERATION WHERE TH ERE IS SEARCH U/S 132. 13. UNDER THE PROVISIONS OF SECTION 153A, THE ASSESSIN G OFFICER IS BOUND TO ISSUE NOTICE TO THE ASSESSEE TO FURNISH THE RETURNS OF IN COME FOR EACH ASSESSMENT YEARS FALLING WITHIN THE SIX ASSESSMENT YEARS IMMED IATELY PRECEDING THE ASSESSMENT YEAR IN WHICH SEARCH OR REQUISITION IS M ADE. ANOTHER SIGNIFICANT FEATURE OF THIS SECTION IS THAT THE ASSESSING OFFIC ER IS EMPOWERED TO ASSESS OR REASSESS THE TOTAL INCOME OF THE AFORESAID PERIOD W HICH INCLUDES DISCLOSED AND UNDISCLOSED INCOME. THEREFORE, THE NEW PROVISIONS H AS GIVEN WIDE POWERS TO THE ASSESSING OFFICER TO ASSESS OR REASSESS THE TOT AL INCOME OF SIX ASSESSMENT ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 30 YEARS FALLING WITHIN THE PERIOD OF THOSE SIX ASSESS MENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR IN WHICH SEARCH IS CO NDUCTED. UNDER THE NEW PROVISIONS OF SECTION 153A, THE STATUTE IS PROVIDES WIDE POWERS TO THE ASSESSING OFFICER IN RESPECT OF ASSESSMENTS ALREADY COMPLETED U/S 143(1) OR 143(3). IF SUCH ORDERS IS ALREADY IN EXISTENCE PRIOR TO THE IN ITIATION OF SEARCH, THE ASSESSING OFFICER IS EMPOWERED TO REOPEN THOSE PROCEEDINGS AN D REASSESS THE TOTAL INCOME TAKING NOTE OF THE UNDISCLOSED INCOME, IF AN Y, FOUND DURING THE COURSE OF SEARCH. FOR THIS PURPOSE, THE RESTRICTIONS IMPOS ED ON THE ASSESSING OFFICER BY WAY OF SECTIONS 148 TO 153 TO REOPEN THE ASSESSMENT U/S 147 HAS BEEN REMOVED BY THE NON ABSTANTE CLAUSE USED IN SECTION 153A. 14. IN THE PRESENT CASE ON HAND, ADMITTEDLY, THE ASSES SING OFFICER HAS REOPENED THE ASSESSMENT BASED ON A SEARCH CONDUCTED IN A THI RD PARTY CASE. THE AO FORMED THE OPINION BASED ON THE STATEMENT RECORDED FROM THE ASSESSEE, CONSEQUENT TO POST SEARCH PROCEEDINGS TAKEN UP BY T HE DDIT(INV), WHICH SHOWS UNDISCLOSED INCOME WHICH IS THE VERY BASIS OF REOPE NING THE ASSESSMENT. THE SEARCH IS CONDUCTED ON 22-8-2008 WHICH COMES UNDER THE ASSESSMENT YEAR 2009-10. THE ASSESSING OFFICER REOPENED THE ASSESSM ENT YEAR 2008-09, WHICH IS FALLING WITHIN THOSE SIX ASSESSMENT YEARS IMMEDIATE LY PRECEDING THE ASSESSMENT YEAR IN WHICH SEARCH IS CONDUCTED. THE ASSESSEE CAS E FALLS WITHIN THE PROVISIONS OF SECTION 153C, AS THE INCRIMINATING DOCUMENT SEIZ ED IN THE CASE OF SEARCH IN ANOTHER CASE. THE ASSESSING OFFICER, ON SATISFYING THE ABOVE CONDITION IS UNDER OBLIGATION TO ISSUE NOTICE TO THE PERSON REQUIRING HIM TO FURNISH THE RETURN FOR THE SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR IN WHICH SEARCH IS TOOK PLACE. THEREAFTER, THE ASSESSING OFF ICER HAS TO ASSESS OR REASSESS THE TOTAL INCOME OF THOSE SIX ASSESSMENT YEARS. THE WORD 'SHALL' USED IN SECTION 153A MADE IT CLEAR THAT THE ASSESSING OFFICER HAS N O OPTION, BUT TO ISSUE NOTICE AND PROCEED THEREAFTER TO ASSESS OR REASSESS THE TO TAL INCOME. IN THE INSTANT CASE, THE ASSESSING OFFICER ISSUED NOTICE U/S 148 T O REOPEN THE ASSESSMENT. THEREFORE, IN VIEW OF THE NON-ABSTANTE CLAUSE BEGIN WITH SECTION 153A, THE ASSESSING OFFICER HAS NO JURISDICTION TO ISSUE NOTI CE U/S 148 REOPEN THE ASSESSMENT OF THOSE SIX ASSESSMENT YEAR WHICH FALLS WITHIN THE EXCLUSIVE JURISDICTION OF SECTION 153A. THOUGH, BOTH PROVISIO NS OF THE ACT EMPOWERS THE ASSESSING OFFICER TO ASSESS OR REASSESS THE INCOME ESCAPED FROM ASSESSMENT, BOTH SECTIONS ARE DEALING WITH DIFFERENT SITUATIONS . SECTION 147 COMES INTO OPERATION WHEN, THE ASSESSING OFFICER BELIEVES THAT THERE IS AN ESCAPEMENT OF INCOME CHARGEABLE TO TAX, EITHER FROM THE RETURN AL READY FILED OR THROUGH SOME EXTERNAL MATERIAL EVIDENCE CAME TO HIS KNOWLEDGE, W HICH SHOWS THE ESCAPEMENT OF INCOME. WHEREAS, SECTION 153A COMES I NTO OPERATION WHEN THERE IS SEARCH U/S 132 OR BOOKS OF ACCOUNTS, OR AN Y OTHER ASSET OR OTHER DOCUMENTS REQUISITIONED U/S 132A. IF ASSESSING OFFI CER JUSTIFIED IN PROCEEDING WITH SECTION 147 TO REOPEN THE ASSESSMENT, THEN THE RE WOULD BE NO RELEVANCE TO ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 31 SECTION 153A, WHICH WAS INSERTED IN TO THE ACT TO D EAL EXCLUSIVELY WITH SEARCH CASES. THE LEGISLATORS IN THEIR WISDOM CLEARLY SPEL T OUT THE PROVISIONS OF LAW APPLICABLE TO SEARCH CASES BY USING THE WORD SHALL TO BEGIN WITH SECTION 153A, MADE IT MANDATORY THAT THE ASSESSING OFFICER BOUND TO ISSUE NOTICE U/S 153A OR 153C, THEREAFTER PROCEED TO ASSESS OR REASSESS THE TOTAL INCOME, WHERE SEARCH IS CONDUCTED U/S 132 OR REQUISITION IS MADE U/S 132A. THEREFORE, IN OUR OPINION, THE AO IS NOT JUSTIFIED IN REOPENING THE ASSESSMENT U/S 147 AND HIS ORDER IS ILLEGAL AND ARBITRARY. 15. A SIMILAR ISSUE CAME UP FOR CONSIDERATION BEFORE T HE SPECIAL BENCH OF THIS TRIBUNAL AND THE SPECIAL BENCH HAD AN OCCASION TO D EAL WITH THE INTERPRETATION OF SECTION 153A OF THE ACT IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. V. DY. CIT [2012] 137 ITD 287/23 TAXMANN.COM 103 (MUM) (SB ) . THE SPECIAL BENCH AFTER CONSIDERING THE PROVISIONS OF SECTION 153A AN D CBDT CIRCULAR HAS HELD AS UNDER: '52. THE PROVISION COMES INTO OPERATION IF A SEARCH OR REQUISITION IS INITIATED AFTER 31.5.2003. ON SATISFACTION OF THIS CONDITION, THE AO IS UNDER OBLIGATION TO ISSUE NOTICE TO THE PERSON REQUIRING HIM TO FURNISH THE RETURN OF INCOME OF SIX YEARS IMMEDIATELY PRECEDING THE YEAR OF SEARCH. THE WORD USED IS 'SHALL' AND, THUS, THERE IS NO OPTION BUT TO ISSUE SUCH A NOTICE . THEREAFTER HE HAS TO ASSESS OR REASSESS TOTAL INCOME OF THESE SIX YEARS. IN THIS R ESPECT ALSO, THE WORD USED IS 'SHALL' AND, THEREFORE, THE AO HAS NO OPTION BUT TO ASSES OR REASSESS THE TOTAL INCOME OF THESE SIX YEARS. THE PENDING PROCEEDINGS SHALL ABATE. THIS MEANS THAT OUT OF SIX YEARS, IF ANY ASSESSMENT OR REASSESSMENT IS PENDING ON THE DATE OF INITIATION OF THE SEARCH, IT SHALL ABATE. IN OTHER WORDS PENDING PROCEEDINGS WILL NOT BE PROCEEDED WITH THEREAFTER. THE ASSESSMENT HA S NOW TO BE MADE U/S 153A (1)(B) AND THE FIRST PROVISO. IT ALSO MEANS TH AT ONLY ONE ASSESSMENT WILL BE MADE UNDER THE AFORESAID PROVISIONS AS THE TWO PROC EEDINGS I.E. ASSESSMENT OR REASSESSMENT PROCEEDINGS AND PROCEEDINGS UNDER THIS PROVISION MERGED INTO ONE. IF ASSESSMENT MADE UNDER SUB-SECTION (1) IS AN NULLED IN APPEAL OR OTHER LEGAL PROCEEDINGS, THEN THE ABATED ASSESSMENT OR RE ASSESSMENT SHALL REVIVE. THIS MEANS THAT THE ASSESSMENT OR REASSESSMENT, WHI CH HAD ABATED, SHALL BE MADE, FOR WHICH EXTENSION OF TIME HAS BEEN PROVIDED UNDER SECTION 153B. 53. THE QUESTION NOW IS - WHAT IS THE SCOPE OF ASSE SSMENT OR REASSESSMENT OF TOTAL INCOME U/S 153A (1) (B) AND THE FIRST PROVISO ? WE ARE OF THE VIEW THAT FOR ANSWERING THIS QUESTION, GUIDANCE WILL HAVE TO BE S OUGHT FROM SECTION 132(1). IF ANY BOOKS OF ACCOUNT OR OTHER DOCUMENTS RELEVANT TO THE ASSESSMENT HAD NOT BEEN PRODUCED IN THE COURSE OF ORIGINAL ASSESSMENT AND FOUND IN THE COURSE OF SEARCH IN OUR HUMBLE OPINION SUCH BOOKS OF ACCOUNT OR OTHER DOCUMENTS HAVE TO BE TAKEN INTO ACCOUNT WHILE MAKING ASSESSMENT OR REASSESSMENT OF TOTAL ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 32 INCOME UNDER THE AFORESAID PROVISION. SIMILAR POSIT ION WILL OBTAIN IN A CASE WHERE UNDISCLOSED INCOME OR UNDISCLOSED PROPERTY HA S BEEN FOUND AS A CONSEQUENCE OF SEARCH. IN OTHER WORDS, HARMONIOUS I NTERPRETATION WILL PRODUCE THE FOLLOWING RESULTS :- (A) IN SO FAR AS PENDING ASSESSMENTS ARE CONCERNED, THE JURISDICTION TO MAKE ORIGINAL ASSESSMENT AND ASSESSMENT U/S 153A MERGE I NTO ONE AND ONLY ONE ASSESSMENT FOR EACH ASSESSMENT YEAR SHALL BE MADE S EPARATELY ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL E XISTING OR BROUGHT ON THE RECORD OF THE A.O. (B) IN RESPECT OF NON-ABATED ASSESSMENTS, THE ASSES SMENT WILL BE MADE ON THE BASIS OF BOOKS OF ACCOUNT OR OTHER DOCUMENTS NOT PR ODUCED IN THE COURSE OF ORIGINAL ASSESSMENT BUT FOUND IN THE COURSE OF SEAR CH, AND UNDISCLOSED INCOME OR UNDISCLOSED PROPERTY DISCOVERED IN THE COURSE OF SEARCH.' 58. THUS, QUESTION NO. 1 BEFORE US IS ANSWERED A) A S UNDER (A) IN ASSESSMENTS THAT ARE ABATED, THE A.O. RETAIN S THE ORIGINAL JURISDICTION AS WELL AS JURISDICTION CONFERRED ON HIM UNDER S. 153A FOR WHICH ASSESSMENTS SHALL BE MADE FOR EACH OF THE SIX ASSESSMENT YEARS SEPARA TELY ;' 16. IN YET ANOTHER CASE, THE ITAT MUMBAI BENCH, IN THE CASE OF STATE BANK OF INDIA V. DY CIT [2013] 22 ITR (TRIB.) 609, HAD CONS IDERED THE ISSUE. THE MUMBAI BENCH AFTER CONSIDERING THE RELEVANT SECTIONS AND C BDT CIRCULAR HAS HELD AS UNDER: '18. A PERUSAL OF SECTION 153A SHOWS THAT IT STARTS WITH A NON OBSTANTE CLAUSE RELATING TO NORMAL ASSESSMENT PROCEDURE WHICH IS CO VERED BY SECTIONS 139, 147, 148, 149, 151 AND 153 IN RESPECT OF SEARCHES MADE A FTER 31.5.2003. THESE SECTIONS, THE APPLICABILITY OF WHICH HAS BEEN EXCLU DED, RELATE TO RETURNS, ASSESSMENT AND REASSESSMENT PROVISIONS. PRIOR TO, T HE INTRODUCTION OF THESE THREE SECTIONS, THERE WAS CHAPTER XIV- B OF THE ACT WHICH TOOK CARE OF THE ASSESSMENT TO BE MADE IN CASES OF SEARCH AND SEIZUR E. SUCH AN ASSESSMENT WAS POPULARLY KNOWN AS BLOCK ASSESSMENT BECAUSE THE CHA PTER PROVIDED FOR A SINGLE ASSESSMENT TO BE MADE IN RESPECT OF A PERIOD OF A B LOCK OF TEN ASSESSMENT YEARS PRIOR TO THE ASSESSMENT YEAR IN WHICH THE SEARCH WA S MADE. IN ADDITION TO THESE TEN ASSESSMENT YEARS, THE BROKEN PERIOD UP TO THE D ATE ON WHICH THE SEARCH WAS CONDUCTED WAS ALSO INCLUDED IN WHAT WAS KNOWN A S BLOCK PERIOD. THOUGH A SINGLE ASSESSMENT ORDER WAS TO BE PASSED, THE UNDIS CLOSED INCOME WAS TO BE ASSESSED IN THE DIFFERENT ASSESSMENT YEARS TO WHICH IT RELATED. BUT ALL THIS HAD TO BE MADE IN A SINGLE ASSESSMENT ORDER. THE BLOCK ASS ESSMENT SO MADE WAS INDEPENDENT OF AND IN ADDITION TO THE NORMAL ASSESS MENT PROCEEDINGS AS ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 33 CLARIFIED BY THE EXPLANATION BELOW SECTION 158BA(2) . AFTER THE INTRODUCTION OF THE GROUP OF SECTIONS NAMELY, 153A TO 153C, THE SIN GLE BLOCK ASSESSMENT CONCEPT WAS GIVEN A GO-BY. UNDER THE NEW SECTION 15 3A, IN A CASE WHERE A SEARCH IS INITIATED UNDER SECTION 132 OR REQUISITIO N OF BOOKS OF ACCOUNT, DOCUMENTS OR ASSETS IS MADE UNDER SECTION 132A AFTE R 31.5.2003, THE ASSESSING OFFICER IS OBLIGED TO ISSUE NOTICES CALLING UPON TH E SEARCHED PERSON TO FURNISH RETURNS FOR THE SIX ASSESSMENT YEARS IMMEDIATELY PR ECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE SEA RCH WAS CONDUCTED OR REQUISITION WAS MADE. THE OTHER DIFFERENCE IS THAT THERE IS NO BROKEN PERIOD FROM THE FIRST DAY OF APRIL OF THE FINANCIAL YEAR I N WHICH THE SEARCH TOOK PLACE OR THE REQUISITION WAS MADE AND ENDING WITH THE DATE O F SEARCH/REQUISITION. UNDER SECTION 153A AND THE NEW SCHEME PROVIDED FOR, THE A O IS REQUIRED TO EXERCISE THE NORMAL ASSESSMENT POWERS IN RESPECT OF THE PREV IOUS YEAR IN WHICH THE SEARCH TOOK PLACE. 19. UNDER THE PROVISIONS OF SECTION 153A, AS WE HAV E ALREADY NOTICED, THE ASSESSING OFFICER IS BOUND TO ISSUE NOTICE TO THE A SSESSEE TO FURNISH RETURNS FOR EACH ASSESSMENT YEAR FALLING WITHIN THE SIX ASSESSM ENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVI OUS YEAR IN WHICH THE SEARCH OR REQUISITION WAS MADE. ANOTHER SIGNIFICANT FEATURE OF THIS SECTION IS THAT THE ASSESSING OFFICER IS EMPOWERED TO ASSESS O R REASSESS THE 'TOTAL INCOME' OF THE AFORESAID YEARS. THIS IS A SIGNIFICANT DEPAR TURE FROM THE EARLIER BLOCK ASSESSMENT SCHEME IN WHICH THE BLOCK ASSESSMENT ROP ED IN ONLY THE UNDISCLOSED INCOME AND THE REGULAR ASSESSMENT PROCEEDINGS WERE PRESERVED, RESULTING IN MULTIPLE ASSESSMENTS. UNDER SECTION 153A, HOWEVER, THE ASSESSING OFFICER HAS BEEN GIVEN THE POWER TO ASSESS OR REASSESS THE TOTA L INCOME OF THE SIX ASSESSMENT YEARS IN QUESTION IN SEPARATE ASSESSMENT ORDERS. THIS MEANS THAT THERE CAN BE ONLY ONE ASSESSMENT ORDER IN RESPECT O F EACH OF THE SIX ASSESSMENT YEARS, IN WHICH BOTH THE DISCLOSED AND THE UNDISCLO SED INCOME WOULD BE BROUGHT TO TAX. 20. A QUESTION MAY ARISE AS TO HOW THIS IS SOUGHT T O BE ACHIEVED WHERE AN ASSESSMENT ORDER HAD ALREADY BEEN PASSED IN RESPECT OF ALL OR ANY OF THOSE SIX ASSESSMENT YEARS, EITHER UNDER SECTION 143(1)(A) OR SECTION 143(3) OF THE ACT. IF SUCH AN ORDER IS ALREADY IN EXISTENCE, HAVING OBVIO USLY BEEN PASSED PRIOR TO THE INITIATION OF THE SEARCH/REQUISITION, THE ASSESSING OFFICER IS EMPOWERED TO REOPEN THOSE PROCEEDINGS AND REASSESS THE TOTAL INC OME, TAKING NOTE OF THE UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING THE SE ARCH. FOR THIS PURPOSE, THE FETTERS IMPOSED UPON THE ASSESSING OFFICER BY THE S TRICT PROCEDURE TO ASSUME JURISDICTION TO REOPEN THE ASSESSMENT UNDER SECTION S 147 AND 148, HAVE BEEN REMOVED BY THE NON OBSTANTE CLAUSE WITH WHICH SUB S ECTION (1) OF SECTION 153A OPENS. THE TIME-LIMIT WITHIN WHICH THE NOTICE UNDER SECTION 148 CAN BE ISSUED, AS PROVIDED IN SECTION 149 HAS ALSO BEEN MADE INAPP LICABLE BY THE NON OBSTANTE ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 34 CLAUSE. SECTION 151 WHICH REQUIRES SANCTION TO BE O BTAINED BY THE ASSESSING OFFICER BY ISSUE OF NOTICE TO REOPEN THE ASSESSMENT UNDER SECTION 148 HAS ALSO BEEN EXCLUDED IN A CASE COVERED BY SECTION 153A. TH E TIME-LIMIT PRESCRIBED FOR COMPLETION OF AN ASSESSMENT OR REASSESSMENT BY SECT ION 153 HAS ALSO BEEN DONE AWAY WITH IN A CASE COVERED BY SECTION 153A. W ITH ALL THE STOPS HAVING BEEN PULLED OUT, THE ASSESSING OFFICER UNDER SECTIO N 153A HAS BEEN ENTRUSTED WITH THE DUTY OF BRINGING TO TAX THE TOTAL INCOME O F AN ASSESSEE WHOSE CASE IS COVERED BY SECTION 153A, BY EVEN MAKING REASSESSMEN TS WITHOUT ANY FETTERS, IF NEED BE. 21. NOW THERE CAN BE CASES WHERE AT THE TIME WHEN T HE SEARCH IS INITIATED OR REQUISITION IS MADE, THE ASSESSMENT OR REASSESSMENT PROCEEDINGS RELATING TO ANY ASSESSMENT YEAR FALLING WITHIN THE PERIOD OF TH E SIX ASSESSMENT YEARS MENTIONED ABOVE, MAY BE PENDING. IN SUCH A CASE, TH E SECOND PROVISO TO SUB SECTION (1) OF SECTION 153A SAYS THAT SUCH PROCEEDI NGS 'SHALL ABATE'. THE REASON IS NOT FAR TO SEEK. UNDER SECTION 153A, THERE IS NO ROOM FOR MULTIPLE ASSESSMENT ORDERS IN RESPECT OF ANY OF THE 'SIX ASSESSMENT YEA RS UNDER CONSIDERATION. THAT IS BECAUSE THE ASSESSING OFFICER HAS TO DETERMINE N OT MERELY THE UNDISCLOSED INCOME OF THE ASSESSEE, BUT ALSO THE TOTAL INCOME O F THE ASSESSEE IN WHOSE CASE A SEARCH OR REQUISITION HAS BEEN INITIATED. OBVIOUS LY THERE CANNOT BE SEVERAL ORDERS FOR THE SAME ASSESSMENT YEAR DETERMINING THE TOTAL INCOME OF THE ASSESSEE. IN ORDER TO ENSURE THIS STATE OF AFFAIRS NAMELY, THAT IN RESPECT OF THE SIX ASSESSMENT YEARS PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE YEAR IN WHICH THE SEARCH TOOK PLACE THERE IS ONLY ONE DETER MINATION OF THE TOTAL INCOME, IT HAS BEEN PROVIDED IN THE SECOND PROVISO OF SUB S ECTION (1) OF SECTION 153A THAT ANY PROCEEDINGS FOR ASSESSMENT OR REASSESSMENT OF THE ASSESSEE WHICH ARE PENDING ON THE DATE OF INITIATION OF THE SEARCH OR MAKING REQUISITION 'SHALL ABATE'. ONCE THOSE PROCEEDINGS ABATE, THE DECKS ARE CLEARED, FOR THE ASSESSING OFFICER TO PASS ASSESSMENT ORDERS FOR EACH OF THOSE SIX YEARS DETERMINING THE TOTAL INCOME OF THE ASSESSEE WHICH WOULD INCLUDE BO TH THE INCOME DECLARED IN THE RETURNS, IF ANY, FURNISHED BY THE ASSESSEE AS W ELL AS THE UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING THE SEARCH OR REQUISITION. THE POSITION THUS EMERGING IS THAT WHERE ASSESSMENT OR REASSESSMENT PROCEEDINGS A RE PENDING COMPLETION WHEN THE SEARCH IS INITIATED OR REQUISITION IS MADE , THEY WILL ABATE MAKING WAY FOR THE ASSESSING OFFICER TO DETERMINE THE TOTAL IN COME OF THE ASSESSEE IN WHICH THE UNDISCLOSED INCOME WOULD ALSO BE INCLUDED, BUT IN CASES WHERE THE ASSESSMENT OR REASSESSMENT PROCEEDINGS HAVE ALREADY BEEN COMPLETED AND ASSESSMENT ORDERS HAVE BEEN PASSED DETERMINING THE ASSESSEE S TOTAL INCOME AND SUCH ORDERS ARE SUBSISTING AT THE TIME WHEN THE SEARCH OR THE REQUISITION IS MADE, THERE IS NO QUESTION OF ANY ABATEMENT SINCE N O PROCEEDINGS ARE PENDING. IN THIS LATTER SITUATION, THE ASSESSING OFFICER WIL L REOPEN THE ASSESSMENTS OR REASSESSMENTS ALREADY MADE (WITHOUT HAVING THE NEED TO FOLLOW THE STRICT ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 35 PROVISIONS OR COMPLYING WITH THE STRICT CONDITIONS OF SECTIONS 147, 148 AND 151) AND DETERMINE THE TOTAL INCOME OF THE ASSESSEE. SUC H DETERMINATION IN THE ORDERS PASSED UNDER SECTION 153A WOULD BE SIMILAR T O THE ORDERS PASSED IN ANY REASSESSMENT, WHERE THE TOTAL INCOME DETERMINED IN THE ORIGINAL ASSESSMENT ORDER AND THE INCOME THAT ESCAPED ASSESSMENT ARE CL UBBED TOGETHER AND ASSESSED AS THE TOTAL INCOME. IN SUCH A CASE, TO RE ITERATE, THERE IS NO QUESTION OF ANY ABATEMENT OF THE EARLIER PROCEEDINGS FOR THE SI MPLE REASON THAT NO PROCEEDINGS FOR ASSESSMENT OR REASSESSMENT WERE PEN DING SINCE THEY HAD ALREADY CULMINATED IN ASSESSMENT OR REASSESSMENT OR DERS WHEN THE SEARCH WAS INITIATED OR THE REQUISITION WAS MADE. 20. APPLYING THE RATIO OF THE ABOVE DECISIONS TO TH E FACTS OF THE PRESENT CASE, WE FIND THAT THERE IS NO DISPUTE THAT THE ORIGINAL ASS ESSMENT FOR THE A.Y. 2001-02 WAS COMPLETED U/S 143(3) ON 13-2-2004 DETERMINING T HE TOTAL INCOME AT RS. 26354942360/-. THEREAFTER, A SEARCH AND SEIZURE ACT ION WAS INITIATED IN ASSESSEE'S CASE BY THE DEPARTMENT ON 2-7-2005 ON WH ICH DATE THE ASSESSMENT FOR THE A.Y. 2001-02 WAS NOT PENDING. THEREFORE, IN VIEW OF THE NON- OBSTINATE CLAUSE WITH WHICH SUB SECTION (1) OF SECTION 153A O PENS, THE A.O. HAS NO JURISDICTION TO ISSUE NOTICE U/S 148 OF THE ACT IN RESPECT OF THOSE SIX ASSESSMENT YEARS WHICH FALLS WITHIN THE EXCLUSIVE JURISDICTION OF SECTION 153A OF THE ACT AND ACCORDINGLY THE A.O. WAS NOT JUSTIFIED IN ISSUING N OTICE U/S 148 ON 28-8-2006 AND IN COMPLETING THE IMPUGNED ASSESSMENT U/S 143(3 ) R.W.S. 147 OF THE ACT ON 31-10-2006. THE A.O. INSTEAD OF COMPLYING WITH THE REQUIREMENT OF SECTION 153A PROCEEDED WITH THE PROVISIONS OF SECTION 147/1 48 WHICH ARE NOT APPLICABLE IN THE ASSESSMENT U/S 153 A OF THE ACT, THEREFORE, THE IMPUGNED ASSESSMENT COMPLETED U/S 143(3) R.W.S. 147 OF THE A CT IS A NULLITY AND AS SUCH THE ASSESSMENT ORDER DTD. 31-10-2006 PASSED U/S 143 (3) R.W.S. 147 OF THE ACT IS ILLEGAL, ARBITRARY, WHOLLY WITHOUT JURISDICTION AND , HENCE, THE SAME IS QUASHED.' 17. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CAS E AND ALSO APPLYING THE RATIOS OF THE ABOVE MENTIONED DECISIONS, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER, HAS NO JURISDICTION TO ISSUE NOTICE U/S 148 OF THE ACT TO REOPEN THE ASSESSMENTS IN RESPECT OF THOSE SIX ASSE SSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR IN WHICH SEARCH IS CO NDUCTED OR REQUISITION IS MADE. THE PERIOD UNDER CONSIDERATION FALLS WITHIN T HE EXCLUSIVE DOMAIN OF SECTION 153A. IN THE INSTANT CASE, SINCE THE ASSESS MENT IS MADE CONSEQUENT TO SEARCH IN ANOTHER CASE, THE ASSESSING OFFICER IS BO UND TO ISSUE NOTICE U/S 153C AND THEREAFTER PROCEED TO ASSESS OR REASSESS TOTAL INCOME UNDER SECTION 153A OF THE ACT. THE ASSESSING OFFICER, INSTEAD OF COMPLYIN G WITH THE PROVISIONS OF SECTION 153C, PROCEEDED WITH THE REASSESSMENT UNDER SECTION 147/148 WHICH IS NOT APPLICABLE TO SEARCH CASES. THEREFORE, THE IMPU GNED ASSESSMENT ORDER PASSED U/S 143(3), R.W.S. 147 OF THE INCOME TAX ACT , 1961 IS ILLEGAL, ARBITRARY AND ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 36 WITHOUT ANY JURISDICTION. HENCE, THE ASSESSMENT ORD ER DATED 31-12-2010 PASSED U/S 143(3) R.W.S. 147 IS QUASHED. THUS, IT IS CLEAR THAT THE TRIBUNAL HAS TAKEN A CON SISTENT VIEW ON THIS ISSUE AND FURTHER THE DELHI BENCHES OF THIS TRIBUNAL IN CASE OF RAJAT SHUBRA CHATTERJI VS. ACIT (SUPRA) HAS HELD IN PARA 7 AS UNDER:- 7. ON HAVING GONE THROUGH THE DECISIONS CITED ABOVE ESPECIALLY THE DECISION OF AMRITSAR BENCH IN THE CASE OF ITO VS. ARUN KUMAR KA POOR (SUPRA), WE FIND THAT IN THAT CASE AS IN THE PRESENT CASE BEFORE US, REAS SESSMENT WAS INITIATED ON THE BASIS OF INCRIMINATING MATERIAL FOUND IN SEARCH OF THIRD PARTY AND THE VALIDITY OF THE SAME WAS CHALLENGED BY THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS) AND THE LEARNED CIT(APPEALS) VITIATED THE PROCEEDINGS. THE SAME WAS QUESTIONED BY THE REVENUE BEFORE THE ITAT AND THE ITAT AFTER DISC USSING THE CASES OF THE PARTIES AND THE RELEVANT PROVISIONS IN DETAILS HAS COME TO THE CONCLUSION THAT IN THE ABOVE SITUATION, PROVISIONS OF SEC. 153C WERE A PPLICABLE WHICH EXCLUDES THE APPLICATION OF SECTIONS 147 AND 148 OF THE ACT. THE ITAT HELD THE NOTICE ISSUED UNDER SEC. 148 AND PROCEEDINGS UNDER SEC. 147 AS IL LEGAL AND VOID AB INITIO. IT WAS HELD THAT ASSESSING OFFICER HAVING NOT FOLLOWED PROCEDURE UNDER SEC. 153C, REASSESSMENT ORDER WAS RIGHTLY QUASHED BY THE LEARN ED CIT(APPEALS). IN THE PRESENT CASE BEFORE US, IT IS AN ADMITTED FACT, AS ALSO EVIDENT FROM THE REASONS RECORDED AND THE ASSESSMENT ORDER THAT THE INITIATI ON OF REOPENING PROCEEDINGS WAS MADE BY THE ASSESSING OFFICER ON THE BASIS OF I NFORMATION RECEIVED FROM THE DIRECTORATE OF INCOME-TAX (INV.) ON THE BASIS O F SEARCH & SEIZURE OPERATION CONDUCTED AT THE PREMISES OF ROCK LAND GROUP OF CAS ES AND THE DOCUMENTS RELATED TO THE ASSESSEE FOUND DURING THE COURSE OF SEARCH WERE MADE AVAILABLE TO THE ASSESSING OFFICER OF THE PRESENT ASSESSEE. W E THUS RESPECTFULLY FOLLOWING THE DECISION OF CO-ORDINATE BENCH OF THE ITAT IN TH E CASE OF ACIT VS. ARUN KAPUR 140 TTJ 249 (AMRITSAR) HOLD THAT PROVISIONS OF SE C. 153C OF THE ACT WERE APPLICABLE IN THE PRESENT CASE FOR FRAMING THE ASSE SSMENT, IF ANY, WHICH EXCLUDES THE APPLICATION OF SEC. 147 OF THE ACT, HE NCE, NOTICE ISSUED UNDER SEC. 148 OF THE ACT AND ASSESSMENT FRAMED IN FURTHERANCE THERETO UNDER SEC. 147 READ WITH SECTION 143(3) OF THE ACT ARE VOID AB INI TIO. THE REASSESSMENT IN QUESTION IS ACCORDINGLY QUASHED. THE GROUND NO.1 IS ACCORDINGLY ALLOWED. THEREFORE, IN CONJOINT READING OF PROVISIONS OF SEC TION 153A, 153C AND 147/148 OF THE ACT AS WELL AS A CONSISTENT VIEW TAKEN BY TH IS TRIBUNAL IN A SERIES OF DECISION CITED (SUPRA) WE HOLD THAT THE ASSESSMENT OR REASSESSMENT OF INCOME OF THE PERSON OTHER THAN SEARCH PERSONS BASED ON SE IZED MATERIAL CAN BE ONLY BE MADE U/S 153C R.W.S. 153A AND THE PROVISIONS OF SECTION 147/148 OF THE ACT ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 37 ARE NOT APPLICABLE IN SUCH CASES. NO CONTRARY DECIS ION HAS BEEN BROUGHT TO OUR NOTICE. ACCORDINGLY, WE HOLD THAT INITIATION OF PRO CEEDINGS U/S 147/148 BY THE AO TO REASSESS THE INCOME IS ILLEGAL BEING WITHOUT JURISDICTION AND CONSEQUENTLY THE REASSESSMENT ORDER PASSED U/S 147 R.W.S. 143(3) IS ALSO ILLEGAL AND VOID ABINITIO AND IS LIABLE TO BE QUASHED. 7. AS REGARDS THE SECOND OBJECTION OF THE ASSESSEE AGAINST THE REOPENING OF THE ASSESSMENT U/S 148 WE FIND THAT UNDISPUTEDLY THE NO TICE U/S 148 ISSUED ON 25.03.2014 IS AFTER THE EXPIRY OF 4 YEARS FROM THE END OF THE ASSESSMENT YEAR UNDER CONSIDERATION. THE INITIAL ASSESSMENT WAS FRA MED BY THE ASSESSING OFFICER U/S 143(3) R.W.S. 153A AND THEREFORE, THE P ROVISO TO SECTION 147 COMES TO PLAY AND THE ASSESSING OFFICER CANNOT REOP EN THE ASSESSMENT EXCEPT WHEN THERE IS FAILURE ON THE PART OF THE ASS ESSEE TO DISCLOSE FULLY AND TRULY ALL THE FACTS NECESSARY FOR THE ASSESSMENT. T HE REASONS RECORDED BY THE AO HAS BEEN REPRODUCED BY US IN THE FOREGOING PART OF THIS ORDER AND IT IS CLEAR THAT THE AO HAS NOT STATED IN THE REASONS THA T THE ASSESSEE FAILED TO DISCLOSE FULLY AND TRULY ALL THE FACTS NECESSARY F OR THE ASSESSMENT. THE AO WHILE COMPLETING THE INITIAL ASSESSMENT ON 31.03.20 13 UNDER SECTION 143(3) R.W.S. 153A ACCEPTED THE TRANSACTION OF PURCHASE OF 8000 SHARES OF M/S KALYAN BUILDMART PVT. LTD. FROM SHRI MADAN MOHAN GU PTA AND HIS WIFE SMT. SHASHI KALA GUPTA. WHEN THE TRANSACTION OF PURCHASE OF SHARES WAS DISCLOSED BY THE ASSESSEE AND ACCEPTED BY THE AO IN THE POST SEARCH ASSESSMENT FRAMED U/S 153A THEN EVEN IF THE PURCHASE CONSIDERA TION IS SUBSEQUENTLY FOUND TO BE INCORRECT OR UNDER STATED IT DOES NOT G IVE JURISDICTION TO AO TO RESORT TO THE PROVISIONS OF SECTION 147/148 OF THE ACT AFTER EXPIRY OF 4 YEARS FROM THE END OF THE ASSESSMENT YEAR. FURTHER, REASS ESSMENT PROCEEDINGS WERE INITIATED BY THE AO ON THE PREMISE THAT THE AS SESSEE HAS NOT DISCLOSED THE PURCHASE CONSIDER OF THE ALLEGED LAND, HOWEVER, IT IS PERTINENT TO NOTE THAT THE ASSESSEE DID NOT PURCHASE ANY LAND AS IT R EMAINED WITH M/S SHRI KALYAN BUILDMART PVT. LTD. AND THERE IS NO CHANGE O F THE OWNERSHIP OF THE ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 38 SAID LAND AS BELONG TO M/S KALYAN BUILDMART PVT. LT D. WE FIND THAT THERE IS NO TRANSACTION OF SALE AND PURCHASE OF LAND IN QUESTIO N BETWEEN THE ASSESSEE AND SHRI MADAN MOHAN GUPTA. WHAT WAS TRANSFERRED BY SHRI MADAN MOHAN GUPTA AND HIS WIFE SMT. SHASHI KALA GUPTA WERE THE SHARES OF M/S KALYAN BUILDMART PVT. LTD. WHICH OWNED THE LAND IN QUESTIO N. THERE MAY BE A CASE OF UNDER VALUATION OF SHARES AND UNDERSTATEMENT OF CON SIDERATION PAID BY THE ASSESSEE HOWEVER, IT IS NOT A CASE OF PURCHASE OF L AND. THE PURCHASE CONSIDERATION OF SHARES WAS ACCEPTED BY THE AO WHIL E COMPLETING THE ASSESSMENT U/S 143(3) R.W.S. 153A AND THEREFORE, TH E AO IS PRECLUDED TO REASSESS THE INCOME ON THE BASIS OF NON EXISTING TR ANSACTION OF PURCHASE OF LAND. FURTHER, THE AO HIMSELF WAS NOT SURE ABOUT TH E ESCAPEMENT OF INCOME AND ASSESS THE INCOME IN THE HANDS OF THE ASSESSEE ONLY ON PROTECTIVE BASIS. THE VERY BASIS OF INVOKING THE PROVISIONS OF SECTIO N 147/148 IS CONTRARY TO THE FACTS AND RECORD THAT IT WAS A TRANSACTION OF PURCH ASE OF SHARES OF M/S KALYAN BUILDMART PVT. LTD. AND NOT PURCHASE OF LAND OWNED BY THE SAID COMPANY. EVEN IF THE PURCHASE CONSIDERATION OF SHARE IS UNDE R STATED THE REASONS FOR REOPENING DO NOT STATE SO AND THEREFORE, THE REOPEN ING ON THE BASIS OF NON EXISTING TRANSACTION IS NOT PERMITTED. ONCE, THE TR ANSACTION OF PURCHASE OF SHARES WAS REVEALED DURING THE ASSESSMENT U/S 143(3 ) R.W.S. 153A AND THE SAME WAS CONSIDERED AND ACCEPTED BY THE AO THEN THE AO IS NOT PERMITTED TO REOPEN THE ASSESSMENT TO REVIEW ITS ORDER AS IT WOULD AMOUNT TO CHANGE OF OPINION. THE HONBLE MADRAS HIGH COURT IN CASE O F CIT VS. REMEDIES LTD. (SUPRA) HAS HELD IN PARAS 10 TO 12 AS UNDER:- 10. WE FIND FROM THE ORDER OF THE TRIBUNAL AND ALS O ON THE FACTS AS HAS BEEN CULLED OUT FROM THE ASSESSMENT ORDER IN QUESTION TH AT THERE IS NO ELEMENT OF FAILURE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FA CTS NECESSARY FOR ASSESSMENT. THEREFORE, THERE WAS NO JUSTIFICATION FOR THE DEPAR TMENT FOR INVOCATION OF PROCEEDING UNDER SECTION 147 R/W 148 OF THE INCOME TAX ACT. 11. OUR STAND IS FURTHER FORTIFIED BY THE DECISION OF THIS COURT IN TCA NO.217/2015 DATED 2.6.2015, WHEREIN IN A SIMILAR MATTER, THIS C OURT HAS HELD AS UNDER : ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 39 '16. OUR VIEW IS FORTIFIED BY THE DECISION OF THE F ULL BENCH OF THE DELHI HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX V. KELVIN ATOR OF INDIA LTD. REPORTED IN [2002] 256 ITR 1 (DEL) , WHEREIN, THE DELHI HIGH COURT HELD AS FOLLOWS: 'WE ARE UNABLE TO AGREE WITH THE SUBMISSION OF MR. JOLLY TO THE EFFECT THAT THE IMPUGNED ORDER OF REASSESSMENT CANNOT BE FAULTED AS THE SAME WAS BASED ON INFORMATION DERIVED FROM THE TAX AUDIT REPORT. THE TAX AUDIT REPORT HAD ALREADY BEEN SUBMITTED BY THE ASSESSEE. IT IS ONE THING TO SAY THAT THE ASSESSING OFFICER HAD RECEIVED INFORMATION FROM AN AUDIT REPORT WHICH WAS NOT BEFORE THE INCOME- TAX OFFICER, BUT IT IS ANOTHER THING TO SAY THAT SU CH INFORMATION CAN BE DERIVED BY THE MATERIAL WHICH HAD BEEN SUPPLIED BY THE ASSESSE E HIMSELF. WE ALSO CANNOT ACCEPT THE SUBMISSION OF MR. JOLLY T O THE EFFECT THAT ONLY BECAUSE IN THE ASSESSMENT ORDER, DETAILED REASONS HAVE NOT BEEN RECORDED AN ANALYSIS OF THE MATERIALS ON THE RECORD BY ITSELF MAY JUSTIFY T HE ASSESSING OFFICER TO INITIATE A PROCEEDING UNDER SECTION 147 OF THE ACT. THE SAID S UBMISSION IS FALLACIOUS. AN ORDER OF ASSESSMENT CAN BE PASSED EITHER IN TERMS O F SUB-SECTION (1) OF SECTION 143 OR SUB-SECTION (3) OF SECTION 143. WHEN A REGUL AR ORDER OF ASSESSMENT IS PASSED IN TERMS OF THE SAID SUB-SECTION (3) OF SECT ION 143 A PRESUMPTION CAN BE RAISED THAT SUCH AN ORDER HAS BEEN PASSED ON APPLIC ATION OF MIND. IT IS WELL KNOWN THAT A PRESUMPTION CAN ALSO BE RAISED TO THE EFFECT THAT IN TERMS OF CLAUSE (E) OF SECTION 114 OF THE INDIAN EVIDENCE ACT JUDIC IAL AND OFFICIAL ACTS HAVE BEEN REGULARLY PERFORMED. IF IT BE HELD THAT AN ORDER WH ICH HAS BEEN PASSED PURPORTEDLY WITHOUT APPLICATION OF MIND WOULD ITSEL F CONFER JURISDICTION UPON THE ASSESSING OFFICER TO REOPEN THE PROCEEDING WITH OUT ANYTHING FURTHER, THE SAME WOULD AMOUNT TO GIVING A PREMIUM TO AN AUTHORITY EX ERCISING QUASI-JUDICIAL FUNCTION TO TAKE BENEFIT OF ITS OWN WRONG.' 17. THE ABOVE SAID DECISION OF THE FULL BENCH OF TH E DELHI HIGH COURT WAS UPHELD BY THE SUPREME COURT IN THE DECISION REPORTED IN CO MMISSIONER OF INCOME- TAX V. KELVINATOR OF INDIA LTD [2010] 320 ITR 561 ( SC) ., WHEREIN THE SUPREME COURT HELD THAT THE CONCEPT OF 'CHANGE OF OPINION' ON THE PART OF THE ASSESSING OFFICER TO REOPEN THE ASSESSMENT DID NOT STAND OBLI TERATED AFTER THE SUBSTITUTION OF SECTION 147 OF THE INCOME TAX ACT. THE SUPREME C OURT ALSO HELD THAT THE ASSESSING OFFICER HAS POWER TO REOPEN THE ASSESSMEN T, PROVIDED THERE IS 'TANGIBLE MATERIAL' TO COME TO A CONCLUSION THAT TH ERE WAS AN ESCAPEMENT OF INCOME FROM ASSESSMENT. FOR BETTER APPRECIATION, TH E RELEVANT PORTION OF THE SAID DECISION READS AS FOLLOWS: '6. ON GOING THROUGH THE CHANGES, QUOTED ABOVE, MAD E TO SECTION 147 OF THE ACT, WE FIND THAT, PRIOR TO THE DIRECT TAX LAWS (AM ENDMENT) ACT, 1987, REOPENING COULD BE DONE UNDER THE ABOVE TWO CONDITI ONS AND FULFILMENT OF THE SAID CONDITIONS ALONE CONFERRED JURISDICTION ON THE ASSESSING OFFICER TO MAKE A BACK ASSESSMENT, BUT IN SECTION 147 OF THE ACT (WIT H EFFECT FROM 1ST APRIL, 1989), ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 40 THEY ARE GIVEN A GO-BY AND ONLY ONE CONDITION HAS R EMAINED, VIZ., THAT WHERE THE ASSESSING OFFICER HAS REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT, CONFERS JURISDICTION TO REOPEN THE ASSESSMENT. THER EFORE, POST-1ST APRIL, 1989, POWER TO REOPEN IS MUCH WIDER. HOWEVER, ONE NEEDS T O GIVE A SCHEMATIC INTERPRETATION TO THE WORDS 'REASON TO BELIEVE' FAI LING WHICH, WE ARE AFRAID, SECTION 147 WOULD GIVE ARBITRARY POWERS TO THE ASSE SSING OFFICER TO REOPEN ASSESSMENTS ON THE BASIS OF 'MERE CHANGE OF OPINION ', WHICH CANNOT BE PER SE REASON TO REOPEN. WE MUST ALSO KEEP IN MIND THE CON CEPTUAL DIFFERENCE BETWEEN POWER TO REVIEW AND POWER TO REASSESS. THE ASSESSIN G OFFICER HAS NO POWER TO REVIEW ; HE HAS THE POWER TO REASSESS. BUT REASSESS MENT HAS TO BE BASED ON FULFILMENT OF CERTAIN PRECONDITIONS AND IF THE CONC EPT OF 'CHANGE OF OPINION' IS REMOVED, AS CONTENDED ON BEHALF OF THE DEPARTMENT, THEN, IN THE GARB OF REOPENING THE ASSESSMENT, REVIEW WOULD TAKE PLACE. ONE MUST TREAT THE CONCEPT OF 'CHANGE OF OPINION' AS AN IN-BUILT TEST TO CHECK ABUSE OF POWER BY THE ASSESSING OFFICER. HENCE, AFTER 1ST APRIL, 1989, TH E ASSESSING OFFICER HAS POWER TO REOPEN, PROVIDED THERE IS 'TANGIBLE MATERIAL' TO CO ME TO THE CONCLUSION THAT THERE IS ESCAPEMENT OF INCOME FROM ASSESSMENT. REAS ONS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. OUR VIEW GETS SUP PORT FROM THE CHANGES MADE TO SECTION 147 OF THE ACT, AS QUOTED HEREINABOVE. U NDER THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, PARLIAMENT NOT ONLY DELETED THE WORDS 'REASON TO BELIEVE' BUT ALSO INSERTED THE WORD 'OPINION' IN SE CTION 147 OF THE ACT. HOWEVER, ON RECEIPT OF REPRESENTATIONS FROM THE COMPANIES AG AINST OMISSION OF THE WORDS 'REASON TO BELIEVE', PARLIAMENT REINTRODUCED THE SA ID EXPRESSION AND DELETED THE WORD 'OPINION' ON THE GROUND THAT IT WOULD VEST ARB ITRARY POWERS IN THE ASSESSING OFFICER. WE QUOTE HEREINBELOW THE RELEVAN T PORTION OF CIRCULAR NO. 549 DATED OCTOBER 31, 1989 ([1990] 182 ITR (ST.) 1,29), WHICH READS AS FOLLOWS : '7.2 AMENDMENT MADE BY THE AMENDING ACT, 1989, TO R EINTRODUCE THE EXPRESSION 'REASON TO BELIEVE' IN SECTION 147.A NU MBER OF REPRESENTATIONS WERE RECEIVED AGAINST THE OMISSION OF THE WORDS 'REASON TO BELIEVE' FROM SECTION 147 AND THEIR SUBSTITUTION BY THE 'OPINION' OF THE ASSE SSING OFFICER. IT WAS POINTED OUT THAT THE MEANING OF THE EXPRESSION, 'REASON TO BELI EVE' HAD BEEN EXPLAINED IN A NUMBER OF COURT RULINGS IN THE PAST AND WAS WELL SE TTLED AND ITS OMISSION FROM SECTION 147 WOULD GIVE ARBITRARY POWERS TO THE ASSE SSING OFFICER TO REOPEN PAST ASSESSMENTS ON MERE CHANGE OF OPINION. TO ALLAY THE SE FEARS, THE AMENDING ACT, 1989, HAS AGAIN AMENDED SECTION 147 TO REINTRODUCE THE EXPRESSION 'HAS REASON TO BELIEVE' IN PLACE OF THE WORDS 'FOR REASONS TO B E RECORDED BY HIM IN WRITING, IS OF THE OPINION'. OTHER PROVISIONS OF THE NEW SECTIO N 147, HOWEVER, REMAIN THE SAME.' (EMPHASIS SUPPLIED) 18. SIMILAR VIEW HAS BEEN TAKEN BY THIS COURT IN TH E DECISION REPORTED IN COMMISSIONER OF INCOME-TAX V. CHOLAMANDALAM INVE STMENT AND FINANCE CO. LTD. [2009] 309 ITR 110 , WHEREIN IT WAS HELD AS FOLLOWS: ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 41 'IN THOSE CIRCUMSTANCES, IT COULD NOT BE REGARDED T HAT THE ASSESSEE HAD FAILED TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS RELEVAN T FOR THE ASSESSMENT. AS THE FACTS REVEALED THAT THE ASSESSING OFFICER WHO MADE THE OR IGINAL ASSESSMENT ORDER HAS CALLED FOR ALL THE DETAILS REGARDING THE CASE WHERE 100 PER CENT. DEPRECIATION WERE CLAIMED AND THE ASSESSEE HAD FURNISHED THE INV OICES FOR PURCHASE OF ASSETS ON WHICH 100 PER CENT. DEPRECIATION WERE CLAIMED, T HERE WAS NO FAILURE ON THE PART OF THE ASSESSEE AND IF AT ALL THERE WAS ANY FA ILURE, ACCORDING TO THE COMMISSIONER OF INCOME-TAX (APPEALS), IT WAS ON THE PART OF THE ASSESSING OFFICER, WHO MADE THE ORIGINAL ASSESSMENT WITHOUT G OING BEHIND THE NATURE OF THE TRANSACTIONS ACCEPTING THE DETAILS FURNISHED BY THE ASSESSEE. THE TRIBUNAL ALSO EXTRACTED THAT PORTION OF THE ORDER AND FOUND ON THE FACT THAT THERE WAS NO FAULT ON THE PART OF THE ASSESSEE SO AS TO ENABLE T HE DEPARTMENT TO REOPEN THE ASSESSMENT AS THE PROVISO TO SECTION 147 OF THE INC OME-TAX ACT WOULD SQUARELY APPLY TO THE CASE OF THE ASSESSEE. WE FIND NO INFIR MITY IN THE ORDER PASSED BY THE TRIBUNAL. HENCE, THE APPEAL IS DISMISSED.' 19. IN AN IDENTICAL CIRCUMSTANCES, A LEARNED SINGLE JUDGE OF THIS COURT CONSIDERED THE ISSUE IN THE DECISION REPORTED IN FENNER (INDIA ) LTD. V. DEPUTY COMMISSIONER OF INCOME-TAX [2000] 241 ITR 672 (MAD) , WHEREIN, IT WAS OBSERVED AS FOLLOWS: 'THE PRE-CONDITION FOR THE EXERCISE OF THE POWER UN DER SECTION 147 IN CASES WHERE POWER IS EXERCISED WITHIN A PERIOD OF FOUR YE ARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR IS THE BELIEF REASONABLY E NTERTAINED BY THE ASSESSING OFFICER THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAP ED ASSESSMENT FOR THAT ASSESSMENT YEAR. HOWEVER, WHEN THE POWER IS INVOKED AFTER THE EXPIRY OF THE PERIOD OF FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR, A FURTHER PRE-CONDITION FOR SUCH EXERCISE IS IMPOSED BY THE PROVISO NAMELY, THAT THERE HAS BEEN A FAILURE ON THE PART OF THE ASSESSEE TO MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SECTION 142 OR SECTION 148 OR FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR HIS ASSESSMENT FOR THAT ASSESSMENT YEAR. UNLESS, THE CONDITION IN THE PROVISO IS SATISFIED, THE ASSESSING OFFICER DOES NOT ACQUIRE JURISDICTION TO INITIATE ANY PROCEEDING UNDER SECTION 147 OF THE ACT AFTER THE EXPIRY OF FOUR YEA RS FROM THE END OF THE ASSESSMENT YEAR. THUS, IN CASES WHERE THE INITIATIO N OF THE PROCEEDINGS IS BEYOND THE PERIOD OF FOUR YEARS FROM THE END OF THE ASSESS MENT YEAR, THE ASSESSING OFFICER MUST NECESSARILY RECORD NOT ONLY HIS REASON ABLE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT BUT ALSO THE DEFAULT OR FAILURE COMMITTED BY THE ASSESSEE. FAILURE TO DO SO WOULD VITIATE THE NOTICE AND THE E NTIRE PROCEEDINGS. THE RELEVANT WORDS IN THE PROVISO ARE, '. . . . UNLESS ANY INCOME CHARGEABLE TO TAX HAS ES CAPED ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REASON OF THE FAILURE ON THE PAR T OF THE ASSESSEE ... . .' ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 42 MERE ESCAPE OF INCOME IS INSUFFICIENT TO JUSTIFY TH E INITIATION OF ACTION AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR. SUCH ESCAPEMENT MUST BE BY REASON OF THE FAILURE ON THE PART OF THE ASSE SSEE EITHER TO FILE A RETURN REFERRED TO IN THE PROVISO OR TO TRULY AND FULLY DI SCLOSE THE MATERIAL FACTS NECESSARY FOR THE ASSESSMENT. WHENEVER A NOTICE IS ISSUED BY THE ASSESSING OFFICER BEYOND A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, SUCH NOTICE BEING ISSUED WITHOUT RECORDING TH E REASONS FOR HIS BELIEF THAT INCOME ESCAPED ASSESSMENT, IT CANNOT BE PRESUMED IN LAW THAT THERE IS ALSO A FAILURE ON THE PART OF THE ASSESSEE TO FILE THE RET URNS REFERRED TO IN THE PROVISO OR A FAILURE TO FULLY AND TRULY DISCLOSE THE MATERIAL FACTS. THE REASONS REFERRED TO IN THE MAIN PARAGRAPH OF SECTION 147 WOULD, IN CASES W HERE THE PROVISO IS ATTRACTED, INCLUDE REASONS REFERRED TO IN THE PROVI SO AND IT IS NECESSARY FOR THE ASSESSING OFFICER TO RECORD THAT ANY ONE OR ALL THE CIRCUMSTANCES REFERRED TO IN THE PROVISO EXISTED BEFORE THE ISSUE OF NOTICE UNDE R SECTION 147.... . . . . . . . . . . . . . . . . . . . . THE DUTY OF AN ASSESSEE IS LIMITED TO FULLY AND TRU LY DISCLOSING ALL THE MATERIAL FACTS. THE ASSESSEE IS NOT REQUIRED THEREAFTER TO P REPARE A DRAFT ASSESSMENT ORDER. IF THE DETAILS PLACED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER WERE IN CONFORMITY WITH THE REQUIREMENTS OF ALL APPLICABLE LAWS AND KNOWN ACCOUNTING PRINCIPLES, AND MATERIAL DETAILS HAD BEEN EXHIBITED BEFORE THE ASSESSING OFFICER, IT IS FOR THE ASSESSING OFFICER TO REACH SUCH CONCL USIONS AS HE CONSIDERED WAS WARRANTED FROM SUCH DATA AND ANY FAILURE ON HIS PAR T TO DO SO CANNOT BE REGARDED AS THE ASSESSEE'S FAILURE TO FURNISH THE M ATERIAL FACTS TRULY AND FULLY. ANY LACK OF COMPREHENSION ON THE PART OF THE ASSESS ING OFFICER IN UNDERSTANDING THE DETAILS PLACED BEFORE HIM CANNOT CONFER A JUSTI FICATION FOR REOPENING THE ASSESSMENT, LONG AFTER THE PERIOD OF FOUR YEARS HAD EXPIRED. ON THE FACTS OF THIS CASE, IT IS CLEAR THAT THE ESCAPEMENT OF INCOME, IF ANY, ON THIS ACCOUNT IS NOT ON ACCOUNT OF ANY FAILURE ON THE ASSESSEE'S PART TO DI SCLOSE THE MATERIAL FACTS FULLY AND TRULY. THE NOTICE ISSUED BY THE ASSESSING OFFIC ER IN EXERCISE OF HIS POWER UNDER SECTION 147, THEREFORE, CANNOT BE SUSTAINED. AS THE ERROR HERE IS ONE OF JURISDICTION IT IS NOT NECESSARY FOR THE ASSESSEE TO HAVE RECOURSE TO THE REMEDIES BY WAY OF APPEAL, REVISION , ETC. IT IS WELL SETTLED THAT WHEN A JURISDICTIONAL ERROR IS BROUGHT TO THE NOTIC E OF THIS COURT SUCH ERRORS ARE CAPABLE OF BEING CORRECTED BY THIS COURT IN EXERCIS E OF THE COURT'S POWERS UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA. THE SUPRE ME COURT IN THE CASE OF CIT V. PROGRESSIVE ENGINEERING [1993] 200 ITR 231 (SIC), HELD THAT WHEN ALL THE RELEVANT FACTS WERE BEFORE THE COURT AND THE LAW IS CLEAR ON THE SUBJECT, IT IS THE DUTY OF THE HIGH COURT TO INTERFERE. THAT WAS ALSO A CASE W HERE THE PROCEEDINGS WERE SOUGHT TO BE INITIATED AGAINST THE ASSESSEE UNDER S ECTION 147 OF THE ACT. ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 43 20. IN THE CASE OF ICICI SECURITIES LTD . V. ASSIST ANT COMMISSIONER OF INCOME TAX 3(2), MUMBAI, THE BOMBAY HIGH COURT VIDE ORDER DATED 22.08.2006 IN W.P.NO.1919 OF 2006, WHILE DEALING WITH THE ISSUE O N THE REOPENING OF ASSESSMENT, HELD AS FOLLOWS: '7. IN THE FACTS OF THE PRESENT CASE, THERE IS NOTH ING NEW WHICH HAS COME TO THE NOTICE OF THE REVENUE. THE ACCOUNTS HAD BEEN FURNIS HED BY THE PETITIONER WHEN CALLED UPON. THEREAFTER THE ASSESSMENT WAS COMPLETED UNDER SECTI ON 143(3) OF THE INCOME TAX ACT. NOW, ON A MERE RELOOK, THE OFFICER HAS COM E TO THE CONCLUSION THAT THE INCOME HAS ESCAPED ASSESSMENT AND HE IS OF COURSE J USTIFIED IN HIS ANALYSIS. IN OUR VIEW, THIS IS NOT SOMETHING WHICH IS PERMISSIBL E UNDER THE PROVISO TO SECTION 147 OF THE INCOME TAX ACT WHICH SPEAKS ABOUT A FAIL URE ON THE PART OF THE ASSESSEE TO MAKE A PROPER RETURN. IN THE PRESENT CA SE, NO SUCH CASE IS MADE OUT ON THE RECORD. 8. IN THE CIRCUMSTANCES, WE ALLOW THIS PETITION IN TERMS OF PRAYER (A) AND QUASH AND SET ASIDE THE NOTICE DATED 27TH MARCH 2006 DIRE CTING REOPENING OF THE ASSESSMENT FOR THE YEAR 1999-2000. 21. THE ABOVE-SAID VIEW OF THE BOMBAY HIGH COURT WA S AFFIRMED BY THE SUPREME COURT IN CIVIL APPEAL NO.5960 OF 2012.' 12. IN THE LIGHT OF THE ABOVE, WE HOLD THAT WHEN TH E ASSESSING OFFICER HAD FAILED TO RECORD ANYWHERE HIS SATISFACTION OR BELIEF THAT THE INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT ON ACCOUNT OF THE FAILURE OF THE ASSESSEE TO DISCLOSE TRULY AND FULLY ALL MATERIAL FACTS NECESSARY FOR AS SESSMENT. ON THE CONTRARY, IT WAS THE ASSESSING OFFICER, WHO FAILED TO CONSIDER T HE MATERIALS PLACED BEFORE HIM AT THE TIME OF REGULAR ASSESSMENT FOR WHICH THE ASSESSEE CANNOT BE FOUND FAULT WITH. THEREFORE, THE NOTICE ISSUED UNDER SECT ION 147 OF THE INCOME TAX ACT BEYOND THE PERIOD OF FOUR YEARS WAS WHOLLY WITHOUT JURISDICTION AND CANNOT BE SUSTAINED. ACCORDINGLY, FOR THE REASONS STATED ABOV E, THE SUBSTANTIAL QUESTION OF LAW IS ANSWERED IN FAVOUR OF THE RESPONDENT/ASSESSE E AND AGAINST THE APPELLANT/REVENUE. THUS, WHEN THE AO HAS NOT RECORDED IN HIS SATISFACT ION OR BELIEVE THAT THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT ON ACCOUNT OF FAILURE OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR ASSESSMENT THEN THE NOTICE ISSUED U/S 148 BEYOND THE PERIOD OF 4 YEARS WAS WITHOUT JURISDICTION AND IS NOT SUSTAINABLE. HONBLE BOMBA Y HIGH COURT IN CASE OF SITARA ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 44 DIAMOND (P.) LTD. VS. DCIT (SUPRA) WHILE CONSIDERIN G THE VALIDITY OF NOTICE ISSUE U/S 148 AFTER 4 YEARS HAS HELD IN PARA 6 AS UNDER:- 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. BY THE I MPUGNED NOTICE DATED 20 JUNE 2011, THE ASSESSMENT FOR ASSESSMENT YEAR 2005-06 IS SOUGHT TO BE REOPENED BEYOND A PERIOD OF FOUR YEARS OF THE END OF THE REL EVANT ASSESSMENT YEAR. THE CONDITION PRECEDENT TO THE EXERCISE OF THE JURISDIC TION TO REOPEN AN ASSESSMENT BEYOND A PERIOD OF FOUR YEARS AS SPELT OUT IN THE P ROVISO TO SECTION 147 IS THAT THERE OUGHT TO BE A FAILURE ON THE PART OF THE ASSE SSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR ASSESSMENT FOR THA T ASSESSMENT YEAR. IN THE PRESENT CASE, THE SOLE BASIS ON WHICH THE ASSESSMEN T PROCEEDINGS WERE SOUGHT TO BE REOPENED IS THE ORDER WHICH HAS BEEN PASSED ON 5 JULY 2011 FOR ASSESSMENT YEAR 2007-08. IN THAT ORDER, ACCORDING TO THE REVEN UE, IT HAS BEEN HELD THAT THE ASSESSEE ACTS AS A MERE FACILITATOR AND IS NOT A MA NUFACTURER SO AS TO ENTITLE IT TO THE DEDUCTION UNDER SECTION 10A. THE ISSUE, HOWEVER , BEFORE THE COURT, IS AS TO WHETHER THAT CAN FORM THE BASIS OF THE REOPENING OF THE ASSESSMENT BEYOND A PERIOD OF FOUR YEARS. THE REASONS WHICH HAVE BEEN D ISCLOSED BY THE ASSESSING OFFICER DO NOT SET OUT AS TO WHAT FACTS THE ASSESSE E HAD FAILED TO FULLY AND TRULY DISCLOSE. EVEN A PRIMA FACIE REFERENCE TO THE BASIS ON WHICH IT IS SOUGHT TO BE INFERRED THAT THERE WAS A FAILURE TO DISCLOSE ALL M ATERIAL FACTS HAS NOT BEEN SET OUT IN THE REASONS. IN THAT VIEW OF THE MATTER, WE ARE OF THE VIEW THAT THE PRIMARY JURISDICTIONAL REQUIREMENT FOR REOPENING THE ASSESS MENT BEYOND A PERIOD OF FOUR YEARS HAS NOT BEEN FULFILLED IN THIS CASE. SINCE TH E ORDER PASSED BY THE CIT (APPEALS) FOR ASSESSMENT YEAR 2007-08 HAS BEEN PASS ED AFTER THE ASSESSMENT FOR ASSESSMENT YEAR 2005-06 HAS BEEN SOUGHT TO BE REOPE NED BY THE NOTICE DATED 29 JUNE 2011, WE HAVE, FOR THE PURPOSES OF THIS DISCUS SION, KEPT THAT CIRCUMSTANCE OUT OF CONSIDERATION. WE HAVE COME TO THE CONCLUSIO N THAT THE ASSESSING OFFICER HAVING FAILED TO ESTABLISH THAT THERE WAS A FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS FOR ASS ESSMENT YEAR 2005-06, THE REOPENING BEYOND A PERIOD OF FOUR YEARS IS CLEARLY NOT VALID. THERE WAS A FINDING OF FACT BY THE ASSESSING OFFICER IN THE ASSESSMENT ORD ER FOR ASSESSMENT YEAR 2005- 06 THAT THE BUSINESS ACTIVITY OF THE ASSESSEE IS MA NUFACTURING OF JEWELLERY IN A SPECIAL ECONOMIC ZONE. THAT FINDING, AS THE ASSESSM ENT ORDER NOTES, WAS BASED UPON A CONSIDERATION OF THE FACTS OF THE CASE AND U PON EXAMINING THE CONTENTIONS OF THE ASSESSEE. WHEN THE AO HAS FAILED TO SET OUT IN THE REASONS RE CORDED AS TO WHAT FACTS THE ASSESSEE HAS FAILED TO DISCLOSE FULLY AND TRULY THE N THE REOPENING AFTER 4 YEARS IS INVALID BEING WITHOUT JURISDICTION. WE DO NOT WISH TO MULTIPLY THE PRECEDENT ON THIS ISSUE THOUGH RELIED UPON BY THE LD. AR OF THE ASSESSEE. ACCORDINGLY, IN THE ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 45 FACTS AND CIRCUMSTANCES OF THE CASE AND IN VIEW OF THE VARIOUS DECISIONS AS STATED ABOVE WE HOLD THAT THE REOPENING AFTER 4 YEARS FROM THE END OF THE ASSESSMENT YEAR IS BAD IN LAW BEING WITHOUT JURISDICTION AND C ONSEQUENTIAL ASSESSMENT IS INVALID, ACCORDINGLY, THE REASSESSMENT ORDER IS QUA SHED. SINCE, WE HAVE QUASHED THE REASSESSMENT ORDER ITSELF, THEREFORE, WE DO NOT PROPOSE TO GO INTO THE OTHER GROUNDS RAISED BY THE ASSESSEE. THE REASONS RECORDED BY THE ASSESSING OFFICER IN REO PENING THE ASSESSMENT OF THE ASSESSEE ARE IDENTICAL TO THAT OF SHRI NAVRATTAN KOTHARI. FURTHER THE ASSESSING OFFICER HAS PROCEEDE D IN THE CASE OF ASSESSEE AS WELL AS IN THE CASE OF SHRI NAVRATTAN KO THARI ON THE PREMISES THAT THE ASSESSEE ALONGWITH TWO OTHER PERSONS HAVE PU RCHASED THE LAND IN QUESTION BY PAYING ON MONEY AS FOUND RECORDED IN THE SEIZED MATERIAL, WHICH WAS EXPLAINED BY SHRI MADAN MOHAN GUPTA. HOWEVER , AS PER THE SALE DEED, THE SAID LAND WAS PURCHASED BY M/S SHRI K ALYAN BUILMART PVT. LTD. FROM THE OWNER OF THE LAND AND THEREFORE, WHEN T HE PURCHASE TRANSACTION WAS NOT IN THE NAME OF THE ASSESSEE THEN THE ASSESSING OFFICER HAS FAILED TO SET OUT IN THE REASONS RECORD ED AS TO HOW THE ASSESSEE HAS FAILED TO DISCLOSE FULLY AND TRULY ALL RELEVANT MATERIALS NECESSARY FOR ASSESSMENT PARTICULARLY WHEN THE ASSE SSEE HAD ALREADY DISCLOSED THE TRANSACTION OF SHARES OF M/S SHRI KAL YAN BUILMART PVT. LTD. FROM SHRI MADAN MOHAN GUPTA AND SMT. SHASHI KALA GU PTA. FOLLOWING THE EARLIER ORDER OF THIS TRIBUNAL IN THE CASE OF SH RI NAVRATTAN KOTHARI VS. ITA 437/JP/2017_ DCIT VS. VIMAL CHAND SURANA (HUF) 46 ACIT (SUPRA), WE HOLD THAT THE REOPENING OF THE ASSES SMENT AFTER FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR UNDER CON SIDERATION IS NOT VALID AND THE SAME IS QUASHED. 8. SINCE, WE HAVE QUASHED THE VALIDITY OF THE REOPEN ING AND CONSEQUENTIAL REASSESSMENT ORDER, THEREFORE, WE DO N OT PROPOSE TO GO INTO THE OTHER GROUNDS RAISED BY THE REVENUE ON THE MERITS OF THE ADDITION. 9. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17/05/2018. SD/- SD/- FOT; IKY JKO HKKXPAN (VIJAY PAL RAO) (BHAGCHAND) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 17 TH MAY, 2018 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE DCIT, CIRCLE-2, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- SHRI VIMAL CHAND SURANA (HUF), JAIPU R. 3. VK;DJ VK;QDR @ THE CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 437/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR