Asstt. C.I.T., Circle-3, Gwalior V. Smt. Julie Gupta, Gwalior

ITA 7/AGR/2011

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 2505 (ITAT-AGRA)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 01-03-2012
• Assessment Year: 2001-2002
• Appeal Filed On: 07-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K SHARMA
• Keywords: Income from undisclosed sources; Principle of natural justice; Accommodation entries; Reason to believe; Reassessment proceedings; Borrowed satisfaction; Capital Gains
• Section: 143(1); 147; 148; 144; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO.07/AGR/2011 ASSESSMENT YEAR: 2001-02 ASSTT. COMMISSIONER OF INCOME TAX, VS. SMT. J ULIE GUPTA, CIRCLE-3, GWALIOR. 61, LAXMIBAI COLONY, GWALIOR (M.P.) (PAN: ACOPG 5405B). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI A.K. SHARMA, JR. D.R. RESPONDENT BY : SHRI ANURAG SINHA, ADVOCATE ITA NO.08/AGR/2011 ASSESSMENT YEAR: 2001-02 ASSTT. COMMISSIONER OF INCOME TAX, VS. SMT. P OONAM GUPTA, CIRCLE-3(1), GWALIOR. 61, MLB COLONY, GWALIOR (M.P.) (PAN: ACOPG 5442 Q). ITA NO.09/AGR/2011 ASSESSMENT YEAR: 2001-02 ASSTT. COMMISSIONER OF INCOME TAX, VS. SMT. R AJESH GUPTA, CIRCLE-3, GWALIOR. 61, LAXMIBAI COLONY, GWALIOR (M.P.) (PAN: ACOPG 5439 M). (APPELLANTS) (RESPONDENTS) APPELLANTS BY : SHRI SOHAIL AKHTAR, JR. D.R. RESPONDENTS BY : SHRI ANURAG SINHA, ADVOCATE DATE OF HEARING : 01.03.2012 DATE OF PRONOUNCEMENT : 07.03.2012 ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 2 ORDER PER A.L. GEHLOT, ACCOUNTANT MEMBER: THESE ARE APPEALS FILED BY THE REVENUE AGAINST DIFF ERENT ORDERS, ALL DATED 08.10.2010, PASSED BY THE LD. CIT(A), GWALIOR FOR T HE ASSESSMENT YEAR 2001-02. 2. THE GROUNDS RAISED IN ALL THE APPEALS ARE BASED ON IDENTICAL SET OF FACTS AND, THEREFORE, FOR THE SAKE OF CONVENIENCE ALL THESE AP PEALS ARE DECIDED BY THIS COMMON ORDER. THE COMMON GROUNDS, EXCEPT FOR AMOUN TS IN DISPUTE, RAISED IN ITA NO.07/AGR/2011 IN THE CASE OF SMT. JULIE GUPTA ARE REPRODUCED AS UNDER :- 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE THE LD. CIT(APPEALS) HAS ERRED IN HOLDING THAT THE PROC EDURE TAKEN BY THE A.O. TO PASS THE ASSESSMENT ORDER U/S 144/147 IS IN VALID. WHEREAS IN THE CASE OF LATE SHRI MOHAN LAL GUPTA, L/H. SMT. RA JESH GUPTA WHICH IS IDENTICAL TO THIS CASE WHERE GROUNDS RELATING TO ISSUANCE OF NOTICE U/S 148 OF INCOME TAX ACT, 1961 TAKEN BY THE ASSESS EE WERE DISMISSED BY THE LD. CIT(A). 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF ` 22,91,450/- ON ACCOUNT OF ACCOMMODATION ENTRIES RECEIVED FROM M/S M.K.M. FINSEC PVT. LTD. 3. THE BRIEF FACTS OF THE CASE ARE THAT A NOTICE UN DER SECTION 148 OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) WAS ISSUED ON 31 ST MARCH, 2008 AND WAS ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 3 SERVED BY AFFIXTURE THROUGH THE INSPECTOR ON THE LA ST KNOWN ADDRESS OF THE ASSESSEE. A COPY OF THE NOTICE WAS ALSO SENT TO THE ASSESSEE BY REGISTERED POST ON 31.03.2008. THE ASSESSEE FILED A LETTER DATED 29.1 2.2008 STATING THAT NO NOTICE UNDER SECTION 148 WAS RECEIVED AND THE REASONS RECO RDED FOR ISSUE OF NOTICE UNDER SECTION 148 MAY BE SUPPLIED TO THE ASSESSEE. IT WA S REQUESTED THAT TILL THE REASONS ARE SUPPLIED, FURTHER TIME MAY BE GRANTED. THE ASS ESSING OFFICER NOTED THAT HE HAD NO ALTERNATIVE BUT TO COMPLETE THE ASSESSMENT EX-PA RTE UNDER SECTION 144 OF THE ACT AS THE CASE WAS GOING TO BE TIME BARRED. THE ASSES SING OFFICER NOTED THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE RECEIVED ACCOMMODATION ENTRIES ON ACCOUNT OF CAPITAL GAIN ON SHARES FROM M/S. M.K.M. FINSEC PVT. LTD. SHRI MAHESH BATRA OF M.K.M. FINSEC PVT. LTD. IN HIS STATEMENT R ECORDED ON 23.01.2004 BY INVESTIGATION WING, DELHI HAS ADMITTED TO HAVE PROV IDED ACCOMMODATION ENTRIES TO THE ASSESSEE AS CAPITAL GAIN ON SHARES FOR WHICH NO ACTUAL SALE AND PURCHASE OF SHARES WERE TRANSACTED. THE ASSESSING OFFICER NOTE D THAT THE ASSESSEE WAS ASKED TO FURNISH EXPLANATION IN RESPECT OF ACCOMMODATION ENT RIES OF ` 22,91,450/- RECEIVED FROM M/S. M.K.M. FINSEC PVT. LTD DURING THE YEAR UN DER CONSIDERATION BUT THE ASSESSEE DID NOT FURNISH ANY EXPLANATION. THE ASSE SSING OFFICER ALSO NOTED THAT NO COMPLIANCE OF NOTICE UNDER SECTION 148 WAS MADE. T HEREFORE, THE ASSESSING OFFICER TREATED THE SAID AMOUNT OF ` 22,91,450/- AS INCOME FROM UNDISCLOSED SOURCES. IT HAS ALSO BEEN NOTED BY THE ASSESSING O FFICER THAT THE INCOME TAX ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 4 RETURN FOR THE ASSESSMENT YEAR 2001-02 WAS NOT TRAC EABLE. THEREFORE, THE RETURNED INCOME OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2001 -02 WAS TAKEN SUBJECT TO INCLUSION IN TOTAL INCOME UNDER SECTION 154 OF THE ACT WHEN THE RETURN OF INCOME FOR ASSESSMENT YEAR 2001-02 FILED, IF ANY, IS TRACE D OUT. THE ASSESSING OFFICER ACCORDINGLY MADE THE ASSESSMENT ON TOTAL INCOME OF ` 22,91,450/-. THE ASSESSEE CHALLENGED THE ORDER OF ASSESSING OFFICER BEFORE TH E CIT(A) CHALLENGING REASSESSMENT PROCEEDINGS UNDER SECTION 147 OF THE A CT AND ALSO CHALLENGING THE ORDER OF THE ASSESSING OFFICER ON MERIT. THE CIT(A ) ALLOWED THE APPEAL OF THE ASSESSEE ON LEGAL GROUND AS UNDER :- 3.1 ON PERUSAL OF RECORDS, IT IS SEEN THAT JCIT, R ANGE-2, GWALIOR, HAS RECORDED REASONS VIDE ORDER SHEET ENTRY DATED 3 1.03.2008 ON RECEIPT OF LETTER DATED 26.03.2008 FROM ADDL. DIT ( INV), BHOPAL ON 28.03.2008 DETAILING NAMES, PAN OF PERSONS HAVING R ECEIVED ACCOMMODATION ENTRIES FROM M/S. M.K.M. FINSEC PVT. LTD. DURING THE FINANCIAL YEAR 2000-01 OF THE AMOUNTS MENTIONED AGA INST EACH. AS PER LETTER DATED 28.03.2008 JCIT, RANGE-2, GWALIOR HAS ALSO INFORMED THE THEN ASSESSING OFFICER TO TAKE ACTION U/S 148 IN EACH CASE. ACCORDINGLY NOTICE U/S 148 HAS BEEN ISSUED O N 31.03.2008 WHICH HAS ULTIMATELY BEEN SERVED BY AFFIXTURE BY TH E NOTICE SERVER IN PRESENCE OF TWO WITNESSES ON 24.06.2008 AS PER ITI S REPORT SINCE NOTICE SENT EARLIER BY REGISTERED POST HAS BEEN REC EIVED BACK WITH FOLLOWING REMARKS OF POSTAL AUTHORITY ON 03.04.2008 AND 12.04.2008 PRAPATKARTA BAHAR GAYI HEIN, AANE KA PATA NAHI. V APIS. IN THE MEAN TIME APPELLANTS CASE HAS BEEN TRANSFERRED TO ACIT CIRCLE-3, GWALIOR VIDE ORDER U/S 127 OF THE IT ACT PASSED BY CIT GWALIOR ON 24.04.2008 W.E.F. 25.04.2008. FIRST NOTICE BY ACIT CIRCLE-3 IS FOUND TO BE ISSUED ON 22.12.2008 WHEREBY THE APPELLANT HA S BEEN ASKED TO PRODUCE BOOKS OF ACCOUNTS, BANK ACCOUNTS AND EXPLAN ATION REGARDING CAPITAL GAINS REPRESENTING HER UNDISCLOSED INCOME A T ` 22,91,450/- ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 5 FIXING THE CASE FOR 26.12.2008. ON 26.12.2008, APP ELLANT HAS SUBMITTED THAT NO NOTICE HAS BEEN RECEIVED. HOWEVE R THE THEN ASSESSING OFFICER HAS ALREADY BEEN INFORMED BY WAY OF ABUNDANT CARE THAT THE ORIGINAL RETURN FILED EARLIER FOR ASSESSME NT YEAR 2001-02 MAY BE TREATED AS FILED IN RESPONSE TO NOTICE U/S 148 I SSUED, AS IN THE OTHER CASES OF THE GROUP. THE APPELLANT HAS ALSO REQUEST ED TO SUPPLY THE COPY OF REASONS ALONG WITH NOTICE U/S 148 TO FILE O BJECTIONS. TILL THAT TIME I.E. DISPOSAL OF OBJECTIONS WHICH SHALL BE FIL ED IMMEDIATELY ON RECEIPT OF REASONS, THE PROCEEDINGS MAY BE KEPT IN ABEYANCE. AS PER RECORDS, ASSESSING OFFICER HAS COMPLETED EX-PARTE A SSESSMENT VIDE ORDER DATED 31.12.2008 U/S 144/147 WITHOUT TAKING A NY ACTION AS REQUESTED BY THE APPELLANT. 3.2 THE APPELLANT HAS FILED ORIGINAL RETURN ON 31.0 7.2001 VIDE ACKNOWLEDGEMENT NO.002127 DECLARING INCOME OF ` 2,32,482/- WHICH CONSISTS OF SALARY ( ` 1,30,000) AND OTHER SOURCES ( ` 1,17,482). DEDUCTION U/S 80L HAS BEEN CLAIMED FOR ` 15,000/- ALONGWITH REBATE U/S 88 AND 88C AT ` 21,000/-. ON PERUSAL OF RECORDS IT IS NOTED THAT THIS ORIGINAL RETURN IS NOT AVAILABLE BEFORE THE AS SESSING OFFICER WHEN REASONS HAVE BEEN RECORDED FOR ISSUE OF NOTICE U/S 148. IN FACT, ASSESSING OFFICER DOES NOT APPEAR TO HAVE THE ORIGI NAL RETURN TILL THE COMPLETION OF ASSESSMENT PROCEEDINGS ON 31.12.2008 AS IS EVIDENT FROM THE ASSESSMENT ORDER ITSELF. AS PER PROVISION S OF SECTION 147 OF THE IT ACT, WHERE A RETURN OF INCOME HAS BEEN FURNI SHED BY THE ASSESSEE BUT NO ASSESSMENT HAS BEEN MADE AND IT IS NOTICED BY THE ASSESSING OFFICER THAT THE ASSESSEE HAS UNDER STATE D THE INCOME OR HAS CLAIMED EXCESSIVE LOSS, DEDUCTION, ALLOWANCE OR REL IEF IN THE RETURN; OR IN CASE WHERE AN ASSESSMENT HAS BEEN MADE BUT INCOM E CHARGEABLE TO TAX HAS BEEN UNDER ASSESSED OR ASSESSED AT TOO LOW A RATE THEN THERE IS A CASE WHERE INCOME CHARGEABLE TO TAX HAS ESCAPED A SSESSMENT. IT IS OF IMPORTANCE THAT THE ASSESSING OFFICER SHOULD HAV E APPLIED HIS MIND TO MATERIAL BEFORE HIM AND FORMED A BELIEF REGARDIN G STATEMENT UNDER OR ESCAPEMENT OF INCOME. THE BELIEF MUST BE FORMED BY HIM ON HIS OWN AND NOT AT THE DICTATION OF ANOTHER. HE SHOULD ALSO FORM HIS BELIEF BONA FIDE AND NOT IN A MECHANICAL MANNER. F URTHER, THERE MUST BE DIRECT NEXUS OR LIVE LINK BETWEEN THE MATERIAL C OMING TO THE NOTICE OF THE ASSESSING OFFICER AND THE FORMATION OF HIS B ELIEF THAT INCOME HAS ESCAPED ASSESSMENT. THERE IS NO DENYING THAT T HERE IS BAR ON THE ASSESSING OFFICER TO INITIATE REASSESSMENT PROCEEDI NG IN NON-SCRUTINY CASE AS PROCESSING OF A RETURN U/S 143(1) CAN NOT B E EQUATED TO ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 6 ASSESSMENT. HOWEVER TO INITIATE PROCEEDINGS U/S 14 8, THE EXISTENCE OF A REASONABLE BELIEF ON THE PART OF THE ASSESSING OF FICER IS THE VERY FOUNDATION OF HIS JURISDICTION FOR THIS FOLLOWING F OUR ELEMENTS MUST BE PRESENT: (I) SOME MATERIAL OR MATERIALS AND NOT MERE FANCY, IMAGINATION, SPECULATION, SUSPICION; (II) A NEXUS BETWEEN SUCH MATERIAL AND THE BELIEF O F ESCAPEMENT OF INCOME FROM ASSESSMENT IN THE CIRCUMSTANCES OUTLINE D IN SECTION 147; (III) AN APPLICATION OF MIND BY THE ASSESSING OFFIC ER TO SUCH MATERIAL; AND (IV) AN INFERENCE BASED ON REASON DRAWN TENTATIVELY BY THE OFFICER THAT INCOME HAS ESCAPED ASSESSMENT. IN THE INSTANT CASE ONLY FIRST ELEMENT IS FOUND TO BE PRESENT VIZ. INFORMATION FROM THE INV. WING, NEW DELHI. ASSESSI NG OFFICER IS FOUND TO BE LACKING IN OTHER THREE. ASSESSING OFFI CER HAS ACTED ON BORROWED SATISFACTION AND IN FACT HAD NO MATERIAL I N FORM OF ORIGINAL RETURN OF THE APPELLANT ENABLING HIM TO BELIEVE THA T THE INCOME MENTIONED IN THE REASONS HAS ESCAPED ASSESSMENT. I NFORMATION RECEIVED FROM THE INVESTIGATION WING, AT BEST, CAN BE A SOURCE OF INFORMATION UPON WHICH ASSESSING OFFICER COULD HAVE FORMED HIS OWN INDEPENDENT BELIEF BUT THAT TOO COULD NOT BE DONE S O AS THE ASSESSING OFFICER HAS NO RETURN BEFORE HIM TO VERIFY THE FACT S BEFORE COMING TO CONCLUSION THAT THE INCOME HAS INDEED ESCAPED ASSES SMENT. ASSESSING OFFICER HAS ACTED ONLY ON THE BASIS OF SUSPICION WH EN HE WAS REQUIRED TO ACT ON THE BASIS OF REASON TO BELIEVE AND NOT MERELY REASON TO SUSPECT. THE APPELLANT HAS ALREADY DISCLOSED HER INCOME OF THE YEAR IN THE RETURN FILED ON 31.07.2001. NO EFFORT HAS B EEN MADE BY THE ASSESSING OFFICER TO VERIFY THE CORRECTNESS OF FACT S STATED IN THE LETTER OF THE INVESTIGATION WING NOR SAME HAS BEEN VERIFIE D FROM THE RETURN OF THE APPELLANT. A MERE STATEMENT OF FACTS AND AL LEGATIONS IN THE FORM, OF A REPORT IS NOT A SUBSTITUTE FOR REASONS T HAT ARE REQUIRED TO BE RECORDED BEFORE ISSUING A NOTICE U/S 148. ASSESSIN G OFFICER HAS ACCEPTED THE TRUTH OF THE INFORMATION IN A MECHANIC AL MANNER. HONBLE M.P. HIGH COURT IN THE CASE OF ARJUN SINGH VS. DIRECTOR OF ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 7 INCOME TAX (2000) 246 ITR 363 (M.P.) HAS HELD THAT THE REASONS TO BELIEVE MUST BE BASED ON OBJECTIVE AND RELEVANT MAT ERIALS AND NOT THOSE WHICH ARE EXTRANEOUS AND MERELY OPINION OR IP SE DIXIT BY THE OFFICER, VAGUE, FARFETCHED, FANCIFUL, REMOTE INFORM ATION OR ONLY ALLEGATION. 3.3 IT IS FURTHER SEEN FROM THE PERUSAL OF RECORDS THAT ON RECEIPT OF NOTICE U/S 148, WHICH HAS BEEN SERVED THROUGH AFFIX TURE AND LETTER DATED BY 22.12.2008, APPELLANT HAS INFORMED THE ASS ESSING OFFICER THAT ORIGINAL RETURN FILED MAY BE TREATED AS FILED IN RESPONSE TO THE SAID NOTICE. THE APPELLANT HAS ALSO REQUESTED THE ASSESSING OFFICER TO SUPPLY THE COPY OF REASONS. REQUEST OF THE APPELLA NT REGARDING SUPPLY OF REASONS DOES NOT APPEAR TO HAVE BEEN ACCEDED TO BY THE ASSESSING OFFICER AS PER RECORDS. APPELLANT WAS UNDER GENUIN E BELIEF THAT REASSESSMENT PROCEEDINGS SHALL CONTINUE ONLY AFTER THE ASSESSING OFFICER HAS SUPPLIED THE REASONS AND DULY DISPOSED OFF HER OBJECTIONS SO FILED SO THAT FURTHER SUBMISSIONS CAN BE MADE AC CORDINGLY. THIS IS RIGHTLY SO IN VIEW OF DECISION OF HONBLE SUPREME C OURT IN CASE OF G.K.N. DRIVESHAFTS INDIA (P) LTD. VS. ITO (2003) 25 9 ITR 19 (SC). HOWEVER AS PER RECORDS THE APPELLANT HAS NOT BEEN S UPPLIED COPY OF REASONS SO RECORDED BY JCIT RANGE-2 VIDE ORDER SHEE T ENTRY DATED 31.03.2008. ASSESSING OFFICER HAS PROCEEDED TO COM PLETE EX-PARTE ASSESSMENT ON 31.12.2008. THUS THE ASSESSING OFFIC ER HAS COMPLETED THE ASSESSMENT WITHOUT FOLLOWING THE DUE PROCEDURE IN CASE OF REASSESSMENT PROCEEDINGS. THE PRINCIPLE OF NATURAL JUSTICE HAS ALSO BEEN VIOLATED AS THE APPELLANT HAS NOT BEEN SUPPLIE D COPY OF REASONS SO RECORDED, DESPITE REQUEST MADE BY HER TO ENABLE HER TO FILE OBJECTIONS AS DESIRED. IT IS WELL SETTLED POSITION OF LAW THAT THOUGH RECORDED REASONS NEED NOT BE COMMUNICATED ALONG WIT H THE NOTICE U/S 148 BUT IF AN ASSESSEE FILES RETURN OR SUBMITS THAT ORIGINAL RETURN BE TREATED AS FILED IN RESPONSE TO NOTICE U/S 148, ASS ESSING OFFICER IS BOUND TO DISCLOSE THE REASONS SO RECORDED, IF REQUE STED. THE EX-PARTE ASSESSMENT HAS ALSO BEEN COMPLETED WITHIN A WEEK OF THE ISSUE OF FIRST QUESTIONNAIRE/SHOW CAUSE TO THE APPELLANT DATED 22. 12.2008. FURTHER EVEN IN HIS REMAND REPORT, WHICH HAS BEEN RECEIVED FROM THE ASSESSING OFFICER AFTER A GAP OF MORE THAN ONE YEAR , ASSESSING OFFICER HAS NOT MADE ANY ADVERSE COMMENTS ON THE SUBMISSION S OF THE APPELLANT REGARDING OBJECTIONS TO 148 NOTICE AND OT HER DETAILED SUBMISSIONS ON THE ADDITION MADE. HE HAS SIMPLY RE ITERATED THE ASSESSMENT ORDER. THERE IS A CLEAR CUT VIOLATION O F PRINCIPLE OF ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 8 NATURAL JUSTICE AND OF LAW IN INITIATION AND SUBSEQ UENT COMPLETION OF REASSESSMENT PROCEEDINGS IN THE CASE OF APPELLANT. IN VIEW OF FACTS MENTIONED ABOVE AND PROVISIONS OF LAW, IT IS HELD THAT NO VALID PROCEEDINGS HAVE BEEN INITIATED OR COMPLET ED IN CASE OF THE APPELLANT FOR THE ASSESSMENT YEAR UNDER CONSIDERATI ON. ACCORDINGLY ORDER PASSED U/S 144/147 OF THE IT ACT IS HELD TO B E INVALID. THIS GROUND OF THE APPELLANT IS ALLOWED. 4. THE CIT(A) WHILE DECIDING THE ISSUE ON MERIT IN FAVOUR OF THE ASSESSEE FOLLOWED HER ORDER IN THE CASE OF SMT. RAJESH GUPTA , L/H. LATE SHRI MOHAN LAL GUPTA VIDE ORDER DATED 01.10.2010. 5. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PAR TIES AND RECORDS PERUSED. THE ADMITTED FACTS OF THE CASE UNDER CONSIDERATION ARE THAT THE REASONS FOR REOPENING STATED TO BE RECORDED VIDE ORDER SHEET EN TRY DATED 31.03.2008 ON RECEIPT OF LETTER DATED 26.03.2008 FROM THE ADDL. D.I.T. (I NV.), BHOPAL ON 28.03.2008 DETAILING NAMES, PAN, ETC. OF PERSONS HAVING RECEIV ED ACCOMMODATION ENTRIES FROM M/S. M.K.M. FINSEC PVT. LTD. THE NOTICE UNDER SECTION 148 HAS BEEN ISSUED ON 31.03.2008 WHICH WAS SERVED BY AFFIXTURE BY NOTI CE SERVER. THE ASSESSEE VIDE LETTER DATED 29.12.2008 SUBMITTED BEFORE THE ASSESS ING OFFICER THAT NO NOTICE UNDER SECTION 148 HAS BEEN RECEIVED BY THE ASSESSEE. THE ASSESSEE REQUESTED THE ASSESSING OFFICER TO SUPPLY COPY OF REASONS. THE A SSESSEE FILED ORIGINAL RETURN ON 31.07.2001 DECLARING INCOME OF ` 2,32,482/-. THE ORIGINAL RETURN FILED BY THE ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 9 ASSESSEE WAS NOT AVAILABLE BEFORE THE ASSESSING OFF ICER WHEN REASONS HAVE BEEN RECORDED FOR ISSUE OF NOTICE UNDER SECTION 148. TH E SAID RETURN WAS STATED TO BE NOT TRACEABLE TILL THE COMPLETION OF REOPENING THE ASSE SSMENT UNDER SECTION 148 OF THE ACT. ON A PLAIN READING OF SECTION 147 OF THE ACT, WE NOTICE THAT THE BASIS FOR INITIATING THE REASSESSMENT PROCEEDING IS TO BE JUD GED ON THE BASIS OF REASONS RECORDED. WHEN A NOTICE UNDER SECTION 148 OF THE A CT IS ISSUED, THE PROPER COURSE OF ACTION FOR THE NOTICEE IS TO FILE RETURN AND IF HE SO DESIRES, TO SEEK REASONS FOR ISSUING NOTICE. THE ASSESSING OFFICER IS BOUND TO FURNISH REASONS WITHIN A REASONABLE TIME. ON RECEIPT OF REASONS, THE NOTICE E IS ENTITLED TO FILE OBJECTION TO ISSUANCE OF NOTICE AND THE ASSESSING OFFICER IS BOU ND TO DISPOSE OF THE SAME BY PASSING A SPEAKING ORDER. IN THE CASE UNDER CONSID ERATION, AS STATED ABOVE, THE ADMITTED FACTS THAT THE REASONS RECORDED FOR REOPEN ING OF THE ASSESSMENT WERE NOT FURNISHED TO THE ASSESSEE TILL THE COMPLETION OF TH E ASSESSMENT INSPITE OF THE REQUEST MADE BY THE ASSESSEE. IN SUCH CIRCUMSTANCES, WE AR E OF THE VIEW THAT THE REASSESSMENT ORDER CANNOT BE UPHELD, PARTICULARLY U NDER THE FACTS AND CIRCUMSTANCES WHEN THE ORIGINAL RETURN FILED BY THE ASSESSEE AND STATED TO BE TAKEN THE SAME AS RETURN FILED IN RESPONSE TO NOTICE UNDE R SECTION 148 AND THE SAID RETURN WAS NOT AVAILABLE WITH ASSESSING OFFICER TILL COMPL ETION OF IMPUGNED ASSESSMENT. IT IS ALSO RELEVANT TO STATE THAT THERE IS NO MATER IAL ON RECORD NOR THE SAME HAS BEEN SUBMITTED BY THE REVENUE BEFORE US IN SUPPORT TO TH E FACT THAT THE REASONS FOR ITA NOS.07, 08 & 09/AGR/2011 A.Y. 2001-02 10 REOPENING IN FACT WAS RECORDED AND COPY OF THE SAME WAS GIVEN TO THE ASSESSEE. IN ABSENCE OF SUCH BASIC DOCUMENT AND WITHOUT ADOPTING LEGAL PROCEEDING IN ACCORDANCE WITH LAW, THE REASSESSMENT PROCEEDINGS I NITIATED BY THE ASSESSING OFFICER UNDER SECTION 147 CANNOT BE UPHELD. WE, TH EREFORE, DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A). ORDER OF THE CIT (A) IS CONFIRMED ON THE ISSUE. SINCE WE UPHOLD THE ORDER OF CIT(A) ON THE LEGAL IS SUE, THEREFORE, WE DO NOT THINK IT NECESSARY TO GO TO THE GROUND RAISED IN RESPECT OF MERIT OF THE CASE. 6. SINCE THE FACTS ARE IDENTICAL IN ALL CASES, THER EFORE, IN THE LIGHT OF ABOVE DISCUSSIONS, ORDERS OF CIT(A) IN ALL CASES ARE CONF IRMED ON THE ISSUE. 7. IN THE RESULT, ALL THE THREE APPEALS FILED BY TH E REVENUE ARE DISMISSED. THE ORDER PRONOUNCED IN OPEN COURT ON 07.03.2012. SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 7 TH MARCH, 2012 PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT RESPONDENT CIT CONCERNED CIT (APPEALS) CONCERNED D.R., ITAT AGRA BENCH, AGRA GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY