M/S M/S VIJENDRA SINGH & ASSOCIATES, BILASPUR(CG) V. THE INCOME TAX OFFICER, WARD-1(2),BILASPUR, BILASPUR(CG)

ITA 49/BIL/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5479 (ITAT-RAIPUR)
• Duration Of Justice: 2 year(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 25-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MISHRA
• Assessee Lawyers: S R RAO
• Keywords: Reason to believe
• Section: 147; 148; 6; 10; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER AND DR. MITHA LAL MEENA, ACCOUNTANT MEMBER . / ITA NO S . 49 & 50 /RPR/20 17 / ASSESSMENT YEAR S : 2009 - 10 & 2010 - 11 M/S. VIJENDRA SINGH & ASSOCIATES, C/O. BEDFORD EARTH MOVERS INC. RAJIV GANDHI CHOWK, JARHABHATA, BILASPUR (C.G.) PAN : AAAAV6865H ....... / APPELLANT / V/S. THE INCOME TAX OFFICER, WARD - 1(2), BILASPUR (C.G.) / RESPONDENT A SSESSEE BY : SHRI S.R. RAO, ADVOCATE REVENUE BY : SHRI P.K. MISHRA, CIT - DR / DATE OF HEARING : 15 .05 .2019 / DATE OF PRONOUNCEMENT : 15 .05 .2019 / ORDER PER PARTHA SARATHI CHAUDHU RY, JM : THESE TWO APPEALS PREFERRED BY THE ASSESSEE EMANATES FROM SEPARATE ORDERS OF THE LD. CIT(APPEALS) AS PER RESPECTIVE DATES THEREIN FOR THE 2 ITA NO S . 49 & 50 / RPR /20 17 A.Y S . 2009 - 10 & 2010 - 11 ASSESSMENT YEARS 2009 - 10 AND 2010 - 11 AS PER GROUNDS OF APPEAL ON RECORD. 2. THAT BEFORE US, THE ASSESSEE HAS TAKEN BO TH LEGAL GROUNDS AND GROUNDS ON MERITS. THESE CASES WERE HEARD TOGETHER. SINCE FACTS COMMON AND ISSUES ARE SIMILAR, THESE CASES ARE BEING DISPOSED OF VIDE THIS CONSOLIDATED ORDER. IN THE LEGAL GROUNDS TAKEN BY THE ASSESSEE IN BOTH THESE APPEALS IS THAT N O SATISFACTION HAS BEEN RECORDED BY THE ASSESSING OFFICER BEFORE PASSING RE - ASSESSMENT ORDER U/S.143(3) R.W.S.147 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 3. THE GRIEVANCE OF THE ASSESSE IS THAT THERE IS NO REASON TO BELIEVE ARRIVED AT BY THE AS SESSING OFFICER FOR RESORTING TO RE - ASSESSMENT ORDER U/S.147 OF THE ACT. FIRST WE WOULD ADJUDICATE LEGAL GROUNDS IN RESPECT OF BOTH THE APPEALS. 4. AT THE TIME OF HEARING, THE LD. AR OF THE ASSESSEE VEHEMENTLY ARGUED THAT IN THE REASONS RECORDED BY THE ASSESSING OFFICER FOR RESORTING TO RE - ASSESSMENT PROCEEDINGS U/S.147/148 OF THE ACT, THE REASONS DO NOT PROVIDE ANY EVIDENCE OF SATISFACTION BEING RECO RDED BY THE ASSESSING OFFICER. THE REASONS ARE MAINLY ON FACTS WHICH ARE ALREADY THERE AT THE 3 ITA NO S . 49 & 50 / RPR /20 17 A.Y S . 2009 - 10 & 2010 - 11 TIME OF ORIGINAL ASSESSMENT AND RE - ASSESSMENT IS DONE MAINLY FOR THE PURPOSE OF VERIFICATION AS TO WHETHER ANY INCOME HAS ESCAPED ASSESSMENT. THE CONTENTION OF TH E LD. AR OF THE ASSESSEE IS THAT SUCH VIEW IS NOT PERMITTED WITHIN THE SCOPE OF INCOME TAX LAWS. THE ASSESSING OFFICER PRIMA FACIE HAS TO FORM REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT BEFORE PASSING RE - ASSESSMENT ORDER U/S.147 OF THE ACT AND SATISFACTION TO THAT EXTENT HAS TO BE RECORDED. THE LD. AR FURTHER SUBMITTED THAT THERE CANNOT BE ANY RE - ASSESSMENT ON THE GROUND OF VERIFICATION. THE REASONS RECORDED BY THE ASSESSING OFFICER ARE NOTHING BUT STATING FACTS WHICH ARE ALREADY IN FRONT OF THE ASSESSING OFFICER. THERE IS NO SPECIFIC MATERIAL BROUGHT IN TO SUGGEST THAT INCOME HAS ESCAPED ASSESSMENT. THE LD. AR OF THE ASSESSEE HAS PLACED RELIANCE ON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF INCOME TAX OFFICER, WARD 2(4) VS. CHE TNA SURANA IN TAXC NO.34 OF 2013 . 5. PER CONTRA, THE LD. DR HAS PLACED RELIANCE ON THE ORDERS OF THE SUB - ORDINATE AUTHORITIES. 6. WE HAVE PERUSED THE CASE RECORDS AND HEARD THE RIVAL CONTENTIONS AND CONSIDERED THE JUDICIAL PRONOUNCEMENT PLACED BEFORE US. WE HAVE PERUSED THE REASONS RECORDED BY THE ASSESSING OFFICER BEFORE MAKING RE - ASSESSMENT U/S.147 OF THE ACT WHICH IS PLACED BEFORE US IN THE PAPER 4 ITA NO S . 49 & 50 / RPR /20 17 A.Y S . 2009 - 10 & 2010 - 11 BOOK. THE REASONS ARE NOTHING BUT STATING FACTS WHICH ARE ALREADY IN FRONT OF THE ASSESSING OFFICER AT THE TIME OF ORIGINAL ASSESSMENT. THERE WAS NO NEW MATERIAL WITH THE ASSESSING OFFICER TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. THE ASSESSING OFFICER HAS NO POWER TO MAKE ROVING ENQUIRY. WE TAKE GUIDANCE FROM THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF INCOME TAX OFFICER, WARD 2(4) VS. CHETNA SURANA (SUPRA.) WHEREIN IT WAS OBSERVED THAT THE INCOME TAX OFFICER HAD NOT SET OUT ANY REASON FOR COMING TO THE CONCLUSION THAT IT WAS A FIT CASE FOR ISSUING NOTICE UNDER SECTION 148 OF THE ACT. THE MATERIAL THAT HE HAD BEFORE HIM FOR ISSUING NOTICE HAD NOT BEEN MENTIONED. THE FACTS CONTAINED IN THE COMMUNICATIONS WHICH H AD BEEN RECEIVED WERE ONLY REFERRED TO VAGUELY AND ALL THAT HE HAD SAID WAS ALREADY ON RECORD. THE WORDS REASON TO BELIEVE SUGGEST S THAT THE BELIEF MUST BE THAT OF AN HONEST AND REASONABLE PERSON BASED UPON REASONABLE GROUNDS AND THAT INCOME TAX OFFICER MAY ACT ON DIRECT OR CIRCUMSTANTIAL EVIDENCE BUT NOT ON MERE SUSPICION, GOSSIP OR RUMOUR. THE INCOME TAX OFFICER WOULD BE ACTING WITHOUT JURISDICTION IF THE REASON FOR HIS BELIEF THAT THE CONDITIONS ARE SATISFIED DOES NOT EXIST OR IS NOT MATERIAL OR RELEVA NT TO THE BELIEF REQUIRED BY THE SECTION. IN OUR HUMBLE UNDERSTANDING, THE REASONS TO BELIEVE WHICH REQUIRES FOR MAKING THE ASSESSMENT U/S.14 7 AND PRIOR TO THAT EVEN ISSUING 5 ITA NO S . 49 & 50 / RPR /20 17 A.Y S . 2009 - 10 & 2010 - 11 NOTICE U/S.148 OF THE ACT SHOULD BE BASED ON SOME SPECIFIC REASONS AFTER COND UCTING NECESSARY ENQUIRY IN THE MATTER. THE REASONS TO BELIEVE SHOULD BE SUCH WHICH COULD STAND ALONE IRRESPECTIVE OF OTHER FACTS THAT WAS ALREADY ON RECORD. THERE IS PROVISION OF SCRUTINY ASSESSMENT U/S.143(3) OF THE ACT HOWEVER , THE LEGISLATIVE INTENT WAS THAT THERE MUST BE SOME CASE WHERE INCOME MAY ESCAPE ASSESSMENT AND FOR THAT PURPOSE SECTION 147/148 OF THE ACT WAS INCORPORATED IN THE ACT WHEREBY AFTER ISSUANCE OF NOTICE U/S.148 OF THE ACT , RE - OPENING CAN BE DONE AND RE - ASSESSMENT ORDER CAN BE PASS ED U/S.147 OF THE ACT. BUT THIS PROVISION OF SECTION 147 HAD COME WITH THE LIMIT ATION OF REASONS TO BELIEVE AND WITHOUT THIS REASONS TO BELIEVE, RE - ASSESSMENT PROCEEDINGS CANNOT BE UNDERTAKEN. FURTHER, THE SCRUTINY ASSESSMENT PROCEEDINGS HAS TO BE DONE U/S.143(3) OF THE ACT AND THEREAFTER, ONLY IF SOME NEW MATERIAL S ARE DISCOVERED , THE ASSESSING OFFICER CAN STRONGLY FORM A REASON TO BELIEVE AND AS PER REA SONS RECORDED BY HIM THAT INCOME HAS ESCAPED ASSESSMENT THEN ONLY HE CAN RESORT TO THE PROVISION S OF SECTION 147/148 OF THE ACT. THE ASSESSING OFFICER IS NOT PERMITTED TO RESORT TO REASSESSMENT PROCEEDING FOR THE PURPOSE OF VERIFICATION OR FOR CONDUCTING ANY ROVING ENQUIRY. THEREFORE, RESPECTFULLY FOLLOWING THE PRINCIPLE LAID DOWN BY THE HONBLE JURISDICTIONAL HIGH COURT AS REFERRED HEREIN ABOVE , WE ALLOW THE LEGAL GROUNDS OF THE ASSESSEE. 6 ITA NO S . 49 & 50 / RPR /20 17 A.Y S . 2009 - 10 & 2010 - 11 7. SINCE LEGAL GROUNDS IN THE CASE OF THE ASSESSEE FOR BOTH THE ASSESSMENT YEARS I.E. 2009 - 10 AND 2010 - 11 ARE ANSWERED IN FAVOUR OF THE ASSESSEE, THEREFORE, GR OUNDS ON MERITS BECOMES INFRUCTUOUS. 8. IN THE RESULT, BOTH APPEALS OF THE ASSESSEE FOR THE ASSESSMENT YEARS 2009 - 10 AND 2010 - 11 ARE ALLOWED. ORDER PRO NOUNCED ON 15TH DAY OF MAY , 201 9 . SD/ - SD/ - MITHA LAL MEENA PARTHA SARATHI CHAUDHURY ACCOUNTANT MEMBER JUDICIAL MEMBER / RAIPUR ; / DATED : 15 TH MAY, 2019. SB / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT (APPEALS), BILASPUR (C.G.) 4. THE PR. CIT, BILASPUR (C.G.) 5. , , , / DR, ITAT, RAIPUR BENCH, RAIPUR. 6. / GUARD FILE. // TRUE COPY // / BY ORDER, / PRIVATE SECRETARY , / ITAT, RAIPUR.