Amitabh Virendra Asthana, Bareilly V. Income Tax Officer-1(1), Bareilly

ITA 465/LKW/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1055 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 11-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Application of stay; Reason to believe; Reassessment proceedings
• Section: 142(1); 133A; 147; 131; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 464, 465 & 466/LKW/2016 ASSESSMENT YEAR: 2010 - 11, 2011 - 12 & 2012 - 13 AMITABH VIRENDR A ASTHANA PROP. TAPESHWAR NATHJI & CO. CIRCUIT HOUSE CROSSING CIVIL LINES, BAREILLY V. INCOME TAX OFFICER WARD I(1) BAREILLY T AN /PAN : AGIPA5020E (APP ELL ANT) (RESPONDENT) ASSESSEE BY: SHRI RAKESH GARG, ADVOCATE DEPARTMENT BY: SHRI RAJIV MOHAN, D.R. DATE OF HEARING: 28 0 2 201 8 DATE OF PRONOUNCEMENT: 13 0 3 201 8 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THESE APPEALS PREFERRED BY THE ASSESSEE EMANATES FROM SEPARATE ORDERS PASSED BY THE LD. CIT(A), BAREILLY ALL DATED 31/5/2016. 2 . THE BRIEF FACTS OF THE CASE ARE THAT IN THESE APPEALS, ASSESSEE HAD MOVED STAY APPLICATIONS BEARING NO.10, 11 AND 12/LKW/2016 SEEKING STAY OF DEMAND RAISED BY THE DEPARTMENT. DURING PENDENCY OF STAY APPLICATIONS BEFORE THE TRIBUNAL, ASSESSEE FILED A WRIT PETITION NO.129/20 17 BEFORE HON'BLE JURISDICTIONAL HIGH COURT AND PURSUANT TO THE DIRECTIONS OF THE HON'BLE HIGH COURT VIDE ORDER DATED 7/3/2017, THE STAY PETITIONS WERE DISPOSED OF BY THE TRIBUNAL VIDE ORDER DATED 9/6/2017. THEREAFTER THE LD. A.R. OF THE ASSESSEE MOVED AN APPLICATION DATED 13/6/2017 BEFORE THE HON'BLE VICE PRESIDENT OF ITAT FOR EARLY S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 2 OF 16 HEARING OF THE APPEAL OR FOR TRANSFER OF THE APPEALS TO ANY OTHER BENCH OF THE ITAT . THE HON'BLE VICE PRESIDENT OF ITAT VIDE HIS ORDER DATED 13/6/2017 DIRECTED THAT SINCE TH E STAY APPLICATION HAS BEEN DISMISSED BY THE TRIBUNAL VIDE ORDER DATED 9/6/ 2017; THE APPEAL MAY BE FIXED IN DUE COURSE AT LUCKNOW BENCH ONLY. ACCORDINGLY, THESE APPEALS WERE FIXED FOR HEARING. 3 . SINCE THE FACTS INVOLVED IN ALL THE APPEALS ARE COMMON AND TH E ISSUES ARE SIMILAR, ALL THE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 4 . IN ALL THE APPEALS , ASSESSEE HAS RAISED IDENTICAL GROUNDS WHICH ARE ON RECORD, BUT APART FROM THOSE GROUNDS , ASSESSE E HAS MOVED AN APPLICATION FOR ADMISSION OF ADDITIONAL GROUND OF APPEAL, WHICH IS AS UNDER: - BECAUSE NO NOTICE UNDER SECTION 148 BEING SERVED ON THE ASSESSEE AS LAID DOWN IN SECTION 282(I), THE NOTICE AS WELL AS THE ENTIRE PROCEEDINGS, REASSESSMENT FRAMED ARE WITHOUT JURISDICTION, VOID AB - INITIO, BAD IN LAW AND BE QUASHED. 5 . SINCE THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IS A LEGAL GROUND AND GOES TO THE ROOT OF THE MATTER AND NEEDS NO FACTUAL VERIFICATION, RELYING UPON THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF NTPC LTD. VS. CIT, 229 ITR 383 (SC), WE ADMIT THE ADDITIONAL GROUND RAISED BY THE ASSESSEE FOR ALL THE APPEALS. SINCE THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IS A LEGAL GROUND, WE WILL DEAL WITH THE SAME FIRST. 6 . FOR THE SAKE OF CO NVENIENCE, WE WILL TAKE UP THE FACTS AS APPEARING IN ITA NO.464/LKW/2016. IN THIS CASE, NO RETURN OF INCOME WAS FILED BY THE ASSESSEE AND NO NOTICE UNDER SECTION 148 OF THE ACT WAS RECEIVED BY THE ASSESSEE ON THE ADDRESS GIVEN TO THE DEPARTMENT. S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 3 OF 16 LATER ON , SURVEY UNDER SECTION 133A OF THE ACT WAS CONDUCTED ON THE ASSESSEES PREMISES ON 25/2/2014 AND ASSESSMENT WAS COMPLETED UNDER SECTION 144/147 OF THE ACT. 7 . AT THE TIME OF HEARING BEFORE US, THE LD. A.R. OF THE ASSESSEE VEHEMENTLY ARGUED REGARDING VALIDITY OF RE - ASSESSMENT WHICH IS COMMON IN ALL THE YEARS I.E. ASSESSMENT YEARS 2010 - 11, 2011 - 12 AND 2012 - 13. THE LD. A.R. OF THE ASSESSEE QUESTIONED THE VALIDITY ON TWO COUNTS (1) REASON TO BELIEVE AND (2) SERVICE OF NOTICE. THE LD. A.R. OF THE ASSESSEE CONTEND ED THAT NOTICE UNDER SECTION 148 OF THE ACT DATED 17/5/2013 WAS ISSUED BY THE ASSESSING OFFICER BASED ON CIT BAREILLY'S LETTER NO. MISC. CIT/BLT/2012 - 13 DATED 15.05.2013. THE ASSESSING OFFICER HAS RECORDED THE REASON ON 17.05.2013 AND HAS ISSUED NOTICE U /S.148 IN PURSUANCE TO THE SAME. THE LD. A.R. OF THE ASSESSEE SUBMITTED THAT THIS ITSELF SHOWS THAT THE ASSESSING OFFICER DID NOT MAKE ANY INDEPENDENT INQUIRY. THE ASSESSING OFFICER DID NOT ISSUE ANY NOTICE U/S.131 OR DID NOT CONDUCT ANY ENQUIRY. NOTICE U NDER SECTION 148 OF THE ACT HAS BEEN ISSUED FOR VERIFICATION OF INVESTMENT MADE IN THE PURCHASE OF LAND. SIMILARLY, NOTICES FOR ASSESSMENT YEARS 2011 - 12 AND 2012 - 13 HAVE BEEN ISSUED FOR VERIFICATION OF COST OF CONSTRUCTION MADE BY THE ASSESSEE. THE CONTE NTION OF THE LD. A.R. OF THE ASSESSEE WAS THAT FOR EXERCISING JURISDICTION UNDER SECTION 147/148 OF THE ACT, THE ASSESSING OFFICER MUST HAVE REASON TO BELIEVE AND IN ORDER TO FULFILL THAT HE HAS TO SATISFY HIMSELF BY CONDUCTING NECESSARY ENQUIRY AND NOT AC T MERELY AS PER INSTRUCTION OF THE CIT. THE LD. A.R. OF THE ASSESSEE RELIED UPON THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF ITO VS. LAKHMAN MEWAL DAS, 103 ITR 437 (SC) AND THE DECISION OF AGRA BENCH THIRD MEMBER CASE OF THE TRIBUNAL IN THE CASE OF HOTEL PVT. LTD. VS. ACIT - 116 TTJ 455 (AGRA) (TM) . THE LD. A.R. OF THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS TO SATISFY HIMSELF AND THAT SATISFACTION S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 4 OF 16 SHOULD BE THAT OF THE ASSESSING OFFICER HIMSELF. RELIANCE IN THIS REGARD WAS PLA CED ON THE DECISION S OF THE HON'BLE APEX COURT IN THE CASE OF ITO VS. LAKHMAN MEWAL DAS (SUPRA) AND GANGA SARAN & SONS , 130 ITR 01 (SC) AND THE DECISION OF THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. SMT. PARAMJIT KAUR , 311 ITR 38 (P&H) . THE LD. A.R. OF THE ASSESSEE ALSO SUBMITTED THAT NOTICE UNDER SECTION 148 OF THE ACT OR UNDER SECTION 142(1) OF THE ACT WAS NEVER SERVED UPON THE ASSESSEE. THE NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON A WRONG ADDRESS. THE LD. A.R. OF THE ASSES SEE INVITED OUR ATTENTION TO THE COPIES OF THE RETURNS FOR ASSESSMENT YEAR 2009 - 10 AND 2008 - 09 WHICH ARE ON RECORD AND SUBMITTED THAT IN THOSE RETURNS THE CORRECT ADDRESS OF THE ASSESSEE IS MENTIONED. HE HAS ALSO INVITED OUR ATTENTION TO THE NOTICE ISSUED UNDER SECTION 148 OF THE ACT IN WHICH THE ADDRESS MENTIONED IS SOMETHING DIFFERENT. HE FURTHER SUBMITTED THAT THE ASSESSEE HAS BEEN FILING THE RETURN OF INCOME FROM ADDRESS 204 SAXENA ASHRAM, SUBHASH NAGAR, BAREILLY WHEREAS THE NOTICE U/S.148 HAS BEEN IS SUED ON SIDDHARTH TOWER APARTMENT CIRCUIT CROSSING, CIVIL LINES. BAREILLY . THE LD. A.R. OF THE ASSESSEE FURTHER CONTENDED THAT IN THE ABSENCE OF NOTICE BEING SERVED ON THE ASSESSEE, NO PROCEEDINGS UNDER SECTION 147/148 OF THE ACT CAN BE PROCESSED FURTHER A ND IF PROCESSED, THE SAME BECOMES ILLEGAL. RELIANCE WAS PLACED ON THE DECISION S IN THE CASE OF CIT VS. MANI KAKAR, 178 TAXMAN 315; ITO VS. AJAI VERMA IN ITA NO.45/LUC/2007, ORDER DATED 21.7.2007 AND CIT VS. CHETAN GUPTA, 62 TAXMANN.COM 249. MERE INVESTME NT IN PURCHASE OF PROPERTY AND CONSTRUCTION THEREON WOULD NOT NECESSARILY MEAN THAT THE INCOME HAS ESCAPED ASSESSMENT, JUST LIKE MERE DEPOSITS IN BANK WOULD NOT MEAN THAT THE DEPOSITS MADE IN THE BANK ACCOUNT ARE INCOME WHICH HAS ESCAPED ASSESSMENT. THE L D. A.R. OF THE ASSESSEE FURTHER PLACED RELIANCE UPON THE DECISION IN THE S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 5 OF 16 CASE OF KHALIQ AHMAD VS. ITO IN ITA NO.71/LKW/2017, ORDER DATED 16/1/2018. 8 . THE LD. D.R., ON THE OTHER HAND, REBUTTED THE CONTENTIONS OF THE LD. A.R. OF THE ASSESSEE BY STATING THAT LE TTER FROM CIT AND HIS DIRECTION TANTAMOUNT TO REASON TO BELIEVE BY THE ASSESSING OFFICER BECAUSE REASON TO BELI E VE WOULD MEAN OF THE ENTIRE MACHINERY OF THE DEPARTME NT AND IT CANNOT BE ONLY RESTRICTED TO THE REASON TO BELIEVE BY THE ASSESSING OFFICER. THE REFORE, DIRECTION OF THE CIT ON WHICH BASIS REOPENING DONE , WAS VALID. REGARDING NON - SERVICE OF NOTICE, THE LD. D.R. SUBMITTED THAT IF THERE IS ANY CHANGE OF ADDRESS, ASSESSEE SHOULD HAVE INFORMED THE DEPARTMENT. IN THE ABSENCE OF SUCH INFORMATION, SERVI CE OF NOTICE WAS VALIDLY DONE. 9 . WE HAVE PERUSED THE CASE RECORDS, HEARD THE RIVAL CONTENTIONS AND ANALYSED THE FACTS AND CIRCUMSTANCES IN THIS CASE. AT THE VERY OUTSET, WE WOULD DETERMINE THE SCOPE OF PROVISIONS OF SECTION 147/148 OF THE ACT. THE SPIRIT O F THESE SECTIONS CLEARLY DEMON STRATE S THAT BEFORE MAKING ASSESSMENT OR REASSESSMENT UNDER SECTION 147 OF THE ACT, NOTICE UNDER SECTION 148 OF THE ACT HAS TO BE SERVED ON THE ASSESSEE. THAT ALSO BEFORE INVOKING JURISDICTION UNDER SECTION 147, ASSESSING OFF ICER SHOULD HAVE REASON TO BELIEVE. THE PROVISION CLEARLY SAYS THAT REASON TO BELIEVE IS THAT OF THE ASSESSING OFFICER AND IT IS NOT OF THE ENTIRE MACHINERY OR ENTIRE DEPARTMENT AS W AS SUBMITTED BY THE LD. D.R. IN THIS CASE. NOW THE QUESTION IS WHEN CAN WE SAY THAT ASSESSING OFFICER HAS REASON TO BELIEVE OR BASED ON WHAT FACTS ON RECORD CAN WE DETERMINE THAT THE ASSESSING OFFICER HAS BROUGHT HIS MIND TO SUCH A STATE FOR PASSING ORDER UNDER SECTION 147/148 OF THE ACT THAT HE HAS DEFINITE FACTS AND FIGURES SO AS TO BRING INTO A POSITION THAT HE HAS REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 6 OF 16 10 . WE NOW LOOK INTO THE REASONS RECORDED BY THE ASSESSING OFFICER FOR ISSUANCE OF NOTICE UNDER SECTION 148. FOR READY REFERENCE, COPY OF THE RE ASONS OF THREE YEARS ARE REPRODUCED AS FOLLOWS: - REASON RECORDED FOR ASSESSMENT YEAR 2010 - 11 IN THIS CASE INFORMATION IS RECEIVED FROM THE LD. CIT, BAREILLY VIDE LE TTER F. NO. MISC./C I T/BLY/2012 - 1 3, DATED 15.05.2013 THAT THE ASSESSEE HAS INVESTED RS. 1,20, 00, 000/ - IN PURCHASE OF LAND. THE LAND WAS PURCHASED IN FOUR PIECES. TWO PIECES OF LANDS GOT REGISTERED IN THE MONTH OF JANUARY, 2010 AND OTHER TWO PIECES IN THE MONTH OF MARCH, 2010. SINCE, THE ASSESSEE HAS NOT FILED (HE RETURN OF INCOME FOR THE A. Y. 2 01 0 - 1 1 HENCE, THE SOURCE OF INVESTMENT IS NOT VERIFIABLE. FURTHER, THE ASSESSEE HAS DECLARED TOTAL INCOME IN THE RETURN FILED FOR THE A. Y. 2008 - 09 & 2009 - 10 AT RS.1, 16,473/ - AND AT RS . 1,58, ,100/ - RESPECTIVELY WHICH SHOWS THE ASSESSEE HAS NO CAPACITY OF IN VESTING ABOVE BIG AMOUNT . THEREFORE, I HAVE REASONS TO BELIEVE THAT THE INCOME CHARGEABLE TO TAX TO EXTENT OF RS. 1,20, 00, 000/ - F OR THE A.Y. 2 010 - 11 HAS ESCAPED ASSESSMENT IN TERMS OF PROVISIONS LAID DOWN U/S 147 OF THE I .T. ACT, 1961 FOR WHICH NOTICE U/S. 148 OF THE I .T. ACT. 1961 IS BEING ISSUED. REASON RECORDED FOR ASSESSMENT YEAR 201 1 - 12 IN THIS CASE INFORMATION IS RECEIVED FROM THE LD. CIT, BAREILLY VIDE LE TTER F. NO. MISC./C I T/BLY/2012 - 1 3, DATED 15.05.2013 THAT THE ASSESSEE HAS INVESTED RS. 5 CORES I N CONSTRUCTION OF BUILDING DURING THE ASSESSMENT YEAR 2011 - 12. SINCE, THE ASSESSEE HAS NOT FILED (HE RETURN OF INCOME FOR THE A. Y. 201 1 - 12 HENCE, THE SOURCE OF INVESTMENT IS NOT VERIFIABLE. FURTHER, THE ASSESSEE HAS DECLARED TOTAL INCOME IN THE RETURN FIL ED FOR THE A. Y. 2008 - 09 & 2009 - 10 AT RS.1, 16,473/ - AND AT RS . 1,58, ,100/ - RESPECTIVELY WHICH SHOWS THE ASSESSEE HAS NO S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 7 OF 16 CAPACITY OF INVESTING ABOVE BIG AMOUNT AND THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME FOR ASSESSMENT YEAR 2010 - 11. THEREFORE, I HAV E REASONS TO BELIEVE THAT THE INCOME CHARGEABLE TO TAX TO EXTENT OF RS. 5 CORES F OR THE A.Y. 2 011 - 12 HAS ESCAPED ASSESSMENT IN TERMS OF PROVISIONS LAID DOWN U/S 147 OF THE I .T. ACT, 1961 FOR WHICH NOTICE U/S. 148 OF THE I .T. ACT. 1961 IS BEING ISSUED. REAS ON RECORDED FOR ASSESSMENT YEAR 201 1 - 12 IN THIS CASE INFORMATION IS RECEIVED FROM THE LD. CIT, BAREILLY VIDE LE TTER F. NO. MISC./C I T/BLY/2012 - 1 3, DATED 15.05.2013 THAT THE ASSESSEE HAS INVESTED RS. 5 CORES IN CONSTRUCTION OF BUILDING DURING THE ASSESSMENT YEAR 2012 - 13. SINCE, THE ASSESSEE HAS NOT FILED (HE RETURN OF INCOME FOR THE A. Y. 201 2 - 13 HENCE, THE SOURCE OF INVESTMENT IS NOT VERIFIABLE. FURTHER, THE ASSESSEE HAS DECLARED TOTAL INCOME IN THE RETURN FILED FOR THE A. Y. 2008 - 09 & 2009 - 10 AT RS.1, 16,473 / - AND AT RS . 1,58, ,100/ - RESPECTIVELY WHICH SHOWS THE ASSESSEE HAS NO CAPACITY OF INVESTING ABOVE BIG AMOUNT AND THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME FOR ASSESSMENT YEAR 2010 - 11 AND 2011 - 12 . THEREFORE, I HAVE REASONS TO BELIEVE THAT THE INCOME CHARGEABLE TO TAX TO EXTENT OF RS. 5 CORES F OR THE A.Y. 2 01 2 - 13 HAS ESCAPED ASSESSMENT IN TERMS OF PROVISIONS LAID DOWN U/S 147 OF THE I .T. ACT, 1961 FOR WHICH NOTICE U/S. 148 OF THE I .T. ACT. 1961 IS BEING ISSUED. 11 . ON CAREFUL PERUSAL OF THESE REASONS, IT I S CLEARLY EVIDENT THAT INFORMATION WAS RECEIVED FROM CIT, BAREILLY THAT ASSESSEE HAS INVESTED CERTAIN AMOUNT IN CONSTRUCTION OF BUILDING DURING ASSESSMENT YEAR 2011 - 12 AND 2012 - 13. SIMILARLY, FOR ASSESSMENT YEAR 2010 - 11 INFORMATION WAS RECEIVED FROM CIT, BAREILLY THAT ASSESSEE HAS PURCHASED LAND OF RS.1,20,00,000/ - , THEN REASONS STATES THAT SOURCE OF INVESTMENT IS NOT VERIFIABLE. THEREAFTER THE ASSESSING OFFICER COMPARES THE DECLARED TOTAL S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 8 OF 16 INCOME IN THE RETURN FILED FOR ASSESSMENT YEAR 2008 - 09 AND 2009 - 10 AND BASED ON THOSE RETURN FILED, ASSUMES THAT ASSESSEE HAS NO CAPACITY TO INVEST HUGE AMOUNT. THEREFORE, THE ASSESSING OFFICER HAS REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX TO THE EXTENT OF RS.1,20,00,000/ - FOR ASSESSMENT YEAR 2010 - 11 HAS ESCAPED A SSESSMENT. SIMILARLY, FOR ASSESSMENT YEAR 2011 - 12 AND 2012 - 13 ALSO , BASED ON EARLIER RETURNS FILED , ASSESSING OFFICER HAS COME TO THE CONCLUSION THAT IN THE RESPECTIVE YEARS SUCH INVESTMENT IS NOT POSSIBLE BY THE ASSESSEE AND THEREFORE HE HAS REASON TO BE LIEVE THAT INCOME HAS ESCAPED ASSESSMENT IN TERMS OF SECTION 147/148 OF THE ACT. THEREFORE, THE REASON FOR REOPENING , AS PER ASSESSING OFFICER , FIRSTLY THAT INFORMATION WA S RECEIVED FROM THE CIT AND SECONDLY SIN CE ASSESSEE HAS NOT FILED RETURN OF INCOME S OU R CE OF INVESTME NT WA S NOT VERIFIABLE BUT THE ASSESSING OFFICER HAS JUST COMPARED EARLIER RETURNS FILED AND ON THAT BASIS HE ASSUMED JURISDICTION UNDER SECTION 147/148 OF THE ACT. 12 . WE ASKED TO OURSELVES WHETHER THIS AMOUNTS TO REASON TO BELIEVE AS CONTEM PLATED BY THE LEGISLATURE SO FAR AS PERIPHERY OF INCOME - TAX JURISPRUDENCE IS CONCERNED AND WE HUMBLY FIND ANSWER IN THE NEGATIVE. IT IS SETTLED PRINCIPLE OF LAW AS LAID DOWN BY VARIOUS JUDICIAL PRONOUNCEMENTS THAT THERE MUST BE SOME DEFINITE ACTS AND PERF ORMANCE BY WAY OF INDEPENDENT ENQUIRY BY THE ASSESSING OFFICER AND HE SHOULD BRING INTO RECORD INDEPENDENT MATERIALS IN THE REASONS SO THAT EVEN HUMAN BEING WITH REASONABLE PERCEPTION AFTER READING CAN FORM AN OPINION THAT INCOME HAS ESCAPED ASSESSMENT. E VEN IF WE CONSIDER SUCH REASONABLE PERCEPTION FOR ACADEMIC PURPOSE ONLY BUT AT LEAST THE ASSESSING OFFICER , WHO IS INITIATING THE PROCEEDINGS , SHOULD BE SATISFIED HIMSELF AND THE REASON S ITSELF SHOULD DEMONSTRATE THAT HE HAS CONDUCTED DEFINITE ENQUIRY AND BROUGHT ON BOARD VARIOUS FACTS AND MATERIALS WHEREBY IT CAN BE ASCERTAINED THAT THERE IS A REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. WE S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 9 OF 16 HAVE OBSERVED IN THE PRESENT CASE THIS WAS NOT DONE BY THE ASSESSING OFFICER. MERELY BY RELYING ON THE INS TRUCTION OF THE CIT AND COMPARING EARLIER YEARS RETURNS FILED BY THE ASSESSEE , HE HAS FORMED AN OPINION WHICH CANNOT BE EQUAL TO THE REASON TO BELIEVE AS CONTEMPLATED BY THE LEGISLATURE IN THE INCOME TAX ACT. 13 . IN A HON'BLE DELHI HIGH COURT DECISION IN THE C ASE OF CIT VS. BATRA BHATTA CO., IN ITA NO.109/2008, ORDER DATED 8/8/2008 , THE COURT OBSERVES THAT IN THIS CASE REVENUE HAS PREFERRED AN APPEAL BEFORE ITAT. THE TRIBUNAL OBSERVED THAT ONCE THE ASSESSMENT HAS BEEN COMPLETED, THE ASSESSING OFFICER CAN FRAME A FRESH ASSESSMENT ONLY AFTER COMPLYING WITH THE CONDITIONS LAID DOWN IN SECTIONS 147 AND 148 OF THE ACT. JURISDICTION UNDER SECTIONS 147 AND 148 OF THE SAID ACT CAN BE ASSUMED ONLY AFTER RECORDING REASONS. THE TRIBUNAL OBSERVED THAT THE ASSESSING OFFICER MERELY WANTED TO VERIFY THE CLAIM OF THE ASSESSEE AND THAT IS WHY IT IS NOTED IN THE REASONS RECORDED THAT 'THE CLAIM OF ASSESSEE THAT THE LAND IS AGRICULTURAL AND HENCE NOT A CAPITAL ASSET REQUIRES MUCH DEEPER SCRUTINY'. THE TRIBUNAL CONCLUDED THAT A MERE DESIRE FOR MAKING A FURTHER ENQUIRY DOES NOT CONFER JURISDICTION UPON THE ASSESSING OFFICER FOR RE - ASSESSMENT. THE TRIBUNAL RELIED ON THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF CHHUGAMAL RAJPAL V. S.P. CHALIHA & OTHERS , 79 ITR 603 (SC) AND DIS MISSED THE APPEAL OF THE REVENUE AND AFFIRMED THE ORDER PASSED BY THE COMMISSIONER OF INCOME - TAX (APPEALS) . THEREAFTER, THE HON'BLE DELHI HIGH COURT ALSO LOOKS INTO THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF CHHUGAMAL RAJPAL V. S.P. CHALIHA & OTHERS (SUPRA) AND HAS HELD THAT MERELY BECAUSE THE ASSESSING OFFICER FELT THAT THE ISSUE REQUIRED MUCH DEEPER SCRUTINY, IS NOT GROUND ENOUGH FOR INVOKING SECTION 147. IT IS NOT BELIEF PER SE THAT IS A PRE - CONDITION FOR INVOKING SECTION 147 OF THE SAID ACT BUT A BELIEF FOUNDED ON REASONS. THE EXPRESSION USED IN SECTION 147 IS - 'IF THE ASSESSING S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 10 OF 16 OFFICER HAS REASON TO BELIEVE' AND NOT - 'IF THE ASSESSING OFFICER BELIEVES'. THERE MUST BE SOME BASIS UPON WHICH THE BELIEF CAN BE BUILT UP. IT DOES NOT MATTER WH ETHER THE BELIEF IS ULTIMATELY PROVED RIGHT OR WRONG, BUT, THERE MUST BE SOME MATERIAL UPON WHICH SUCH A BELIEF CAN BE FOUNDED. 14 . SIMILARLY, IN THE CASE OF ITO VS. BRIJENDRA PRAKASH RASTOGI IN ITA NO.574/LKW/2010, IT WAS OBSERVED AND HELD BY LUCKNOW BENCH OF THE TRIBUNAL THAT ASSESSING OFFICER DID NOT BRING ANYTHING ON RECORD TO POINT OUT ANY CASE FOR THE DEPARTMENT. THE ASSESSING OFFICER DID NOT MAKE ANY ENQUIRY OR INVESTIGATION. THE ASSESSING OFFICER NEITHER SUMMONED THE BANKING AUTHORITIES U/S 131 OF THE ACT NOR EXAMINED THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE BEFORE INITIATING THE PROCEEDING U/S 147 OF THE ACT. THEREAFTER THE TRIBUNAL REFERRED TO THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. SFIL STOCK BROKING LTD. [2010] 32 5 ITR 285 (DELHI) WHEREIN IT WAS HELD THAT THE FIRST SENTENCE OF THE REASONS RECORDED BY THE ASSESSING OFFICER WAS MERE INFORMATION RECEIVED FROM THE DEPUTY DIRECTOR OF INCOME - TAX (INVESTIGATION). THE SECOND SENTENCE WAS A DIRECTION GIVEN BY THE SAME DEPUT Y DIRECTOR OF INCOME - TAX (INVESTIGATION) TO ISSUE A NOTICE UNDER SECTION 148 AND THE THIRD SENTENCE AGAIN COMPRISED A DIRECTION GIVEN BY THE ADDITIONAL COMMISSIONER OF INCOME - TAX TO INITIATE PROCEEDINGS UNDER SECTION 148 IN RESPECT OF CASES PERTAINING TO T HE RELEVANT WARD. THE ASSESSING OFFICER REFERRED TO THE INFORMATION AND THE TWO DIRECTIONS AS REASONS ON THE BASIS OF WHICH HE WAS PROCEEDING TO ISSUE NOTICE UNDER SECTION 148. THESE COULD NOT BE THE REASONS FOR PROCEEDING UNDER SECTION 147/148 OF THE ACT. FROM THE REASONS RECORDED IT IS NOT AT ALL CLEAR AS TO WHETHER THE ASSESSING OFFICER HAD APPLIED HIS MIND TO THE INFORMATION AND INDEPENDENTLY ARRIVED AT A BELIEF THAT, ON THE BASIS OF THE MATERIAL WHICH HE HAD BEFORE HIM, INCOME HAD ESCAPED ASSESSMENT. S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 11 OF 16 BASED ON THIS, THE LUCKNOW BENCH OF THE TRIBUNAL DISMISSED THE APPEAL OF THE REVENUE AND SUSTAINED THE RELIEF GIVEN TO THE ASSESSEE. 15 . IN THE INSTANT CASE BEFORE US, WE FIND THAT THE ASSESSING OFFICER HAS NOT TAKEN ANY ACTION SO TO FORM A BELIEF AND NEITHER THERE IS ANY INDEPENDENT APPLICATION OF MIND. ON THE BASIS OF THE JUDICIAL PRONOUNCEMENTS AS DISCUSSED HEREINABOVE, WE ARE OF THE CONSIDERED VIEW AND WE HO LD THAT REASON TO BELIEVE AS ENSHRINED IN SECTION 147 HAS NOT BEEN COMPLIED WITH. IT IS ALSO SETTL ED LAW THAT THE REASONS AS RECORDED FOR REOPENING THE ASSESSMENT ARE TO BE EXAMINED ON A STANDALONE BASIS. 16 . THE REASONS RECORDED SHOULD BE SELF EXPLANATORY AND SHOULD NOT KEEP THE ASSESSEE GUESSING FOR REASONS. THE REASON TO BELIEVE INDICATES A FORMATION O F BELIEF BY THE ASSESSING OFFICER AND IN THE INSTANT CASE REASONS FOR ISSUANCE OF NOTICE UNDER SECTION 148 DO NOT DEMONSTRATE THAT THE ASSESSING OFFICER HAS AN INDEPENDENT BELIEF THAT THERE IS AN ESCAPEMENT OF INCOME. WE, THEREFORE, QUASH THE REASSESSMENT PROCEEDINGS INITIATED BY THE ASSESSING OFFICER ON THIS COUNT. 17 . REGARDING SERVICE OF NOTICE ON THE GIVEN ADDRESS, WE FIND COPIES OF RETURN FOR ASSESSMENT YEAR 2008 - 09 AND 2009 - 10 WHICH ARE MADE AS PART OF THIS ORDER AS ANNEXURE A AND B. WE ALSO MAKE AS PART OF THIS ORDER THE NOTICES ISSUED UNDER SECTION 148 OF THE ACT AS ANNEXURE C AND D. 18 . WE FIND THAT THE ADDRESS IN THE RETURNS FILED IS DIFFERENT TO THE ADDRESS IN THE NOTICES ISSUED UNDER SECTION 148 OF THE ACT. THE ADDRESS OF THE ASSESSEE WAS WIT H THE DEPARTMENT AND THEY HAVE ACKNOWLEDGE D IT WHILE WRITING THE REASONS FOR ISSUANCE OF NOTICE UNDER SECTION 148. S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 12 OF 16 HOWEVER, THEY HAVE ISSUED NOTICE UNDER SECTION 148 ABSOLUTELY ON A DIFFERENT ADDRESS WHICH DOES NOT BELONG TO THE ASSESSEE. IN THIS CIRCUMS TANCES, WE TAKE GUIDANCE FROM THE DECI S IO N OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. MANI KAKAR, 178 TAXMAN 315 (DELHI) WHEREIN IT WAS HELD THAT NO NOTICE WHATSOEVER WAS SERVED ON THE ASSESSEE PRIOR TO THE RE - OPENING OF THE ASSESSMENT PROCEEDI NGS. PROCEEDINGS UNDER SECTION 147 OF THE ACT CANNOT BE INITIATED WITHOUT THE SERVICE OF NOTICE AS PROVIDED IN SECTION 148 OF THE SAID ACT. THE SERVICE OF NOTICE IS A PRE - CONDITION FOR FRAMING AN ASS ESSMENT ORDER UNDER SECTION 147 OF THE ACT. IN VIEW OF T HE ABOVE FACTS, WE HOLD THAT THE REASSESSMENT PROCEEDINGS INITIATED BY THE ASSESSING OFFICER WITHOUT SERVICE OF VALID NOTICE ON THE ASSESSEE IS ARBITRARY, ILLEGAL AND THEREFORE LIABLE TO BE QUASHED ON THIS COUNT ALSO. WE ACCORDINGLY SET ASIDE THE ORDERS O F THE LD. CIT(A) IN ALL THE APPEALS AND QUASH THE REASSESSMENT PROCEEDINGS. 19 . IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 / 0 3 / 201 8 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT ME MBER JUDICIAL MEMBER DATED: 13 TH MARCH , 201 8 JJ: 2802 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 13 OF 16 ANNEXURE A S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 14 OF 16 ANNEXURE B S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 15 OF 16 ANNEXURE C S.P. NO.10, 11 & 12/LKW/2016 ITA NO.464, 465 & 466/LKW/2016 PAGE 16 OF 16 ANNEXURE D