Shri Kaushal, Jhansi v. I.T.O. - 6(3), Jhansi

ITA 74/AGR/2014 | 2006-2007
Pronouncement Date: 30-04-2014 | Result: Allowed

Appeal Details

RSA Number 7420314 RSA 2014
Assessee PAN BLYPK0366H
Bench Agra
Appeal Number ITA 74/AGR/2014
Duration Of Justice 27 day(s)
Appellant Shri Kaushal, Jhansi
Respondent I.T.O. - 6(3), Jhansi
Appeal Type Income Tax Appeal
Pronouncement Date 30-04-2014
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 30-04-2014
Assessment Year 2006-2007
Appeal Filed On 03-04-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH AGRA BEFORE : SHRI BHAVNESH SAINI JUDICIAL MEMBER AND SHRI PRAMOD KUMAR ACCOUNTANT MEMBER ITA NO. 74 & 75/AGRA/2014 ASSTT. YEAR : 2006-07 & 2005-06 SHRI KAUSHAL VS. INCOME-TAX OFFICER S/O DAYARAM ALIAS KALLU 6(3) JHANSI. NAGARIA KA KUA OUT SIDE UNNOV GATE JHANSI (PAN: BLYPK 0366 H) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANOJ BADAL C.A. RESPONDENT BY : SMT. ANURADHA JR. DR DATE OF HEARING : 29.04.2014 DATE OF PRONOUNCEMENT OF ORDER : 30.04.2014 ORDER PER BHAVNESH SAINI J.M.: THIS ORDER SHALL DISPOSE OF BOTH THE ABOVE APPEALS FILED BY THE ASSESSEE AGAINST DIFFERENT ORDERS OF LD. CIT(A)-II AGRA DAT ED 04.10.2013 FOR THE ASSESSMENT YEAR 2006-07 AND DATED 28.11.2013 FOR THE ASSESSMEN T YEAR 2005-06. IN BOTH THE APPEALS THE ASSESSEE CHALLENGED THE REOPENING OF A SSESSMENT U/S. 148 OF THE IT ACT AND IN ADOPTING WRONG RATE OF VALUATION AS ON 01.04 .1981 AND DISALLOWING EXPENSES WITH REGARD TO SALE OF LAND. ITA NO. 74 & 75/AGRA/2014 2 2. IN ASSESSMENT YEAR 2006-07 THE APPEAL IS TIME B ARRED BY THREE DAYS. CONSIDERING THE EXPLANATION OF THE ASSESSEE AND THE LD. DR HAS NO OBJECTION THEREON THE NOMINAL DELAY OF THREE DAYS IN FILING THE APPEAL IS CONDONED. 3. IN ASSESSMENT YEAR 2006-07 BRIEFLY THE FACTS O F THE CASE ARE THAT WHILE COMPLETING THE ASSESSMENT PROCEEDINGS U/S. 143(3) I N THE CASE OF M/S. SAHARA CITY HOMES PVT. LTD. JHANSI THE ASSESSMENT PROCEEDINGS HAS BEEN REOPENED U/S. 147 OF THE IT ACT BY THE AO AFTER NOTICING THAT THE ASSESS EE HAD SOLD AGRICULTURAL LAND BEARING ARAZI NO. 373 & 374 SITUATED AT MAUZA JHANS I KHAS ADMEASURING 4.256 HECTARE FOR RS.88 50 000/- ON 30.05.2005 JOINTLY WI TH HIS BROTHER SHRI RAMESHWAR AND ALSO FINDING FROM THE OFFICE RECORD THAT THE AS SESSEE HAD NOT FILED ANY RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AND FURTHER FINDING THAT LAND WHICH WAS SOLD BY THE ASSESSEE WAS SITUATED WITHIN 8 KILOMETERS OF MUNICIPAL LIMITS OF JHANSI HENCE BEING A CAPITAL ASSET WITH IN THE MEANING OF SECTION 2(14) OF THE IT ACT AND GAIN ARISEN ON SALE OF SUCH LAND WILL BE CHARGEABLE TO CAPITAL GAIN TAX AND THEREFORE AFTER RECORDING THE REASONS TO B ELIEVE THAT CAPITAL GAINS CHARGEABLE TO TAX ARISING OUT OF SALE OF LAND HAS ESCAPED ASSESSMENT THE AO ISSUED NOTICE U/S. 148 ON 22.03.2011. THE AO PROPOSED AS T O WHY LONG-TERM CAPITAL GAIN OF RS.32 17 384 MAY NOT BE ASSESSED AS INCOME. THE AO ULTIMATELY ASSESSED THE INCOME AT THE SAME AMOUNT. THE ASSESSEE CHALLENGED THE REOPENING OF ASSESSMENT AND ADDITION ON MERITS BEFORE THE LD. CIT(A). THE L D. CIT(A) CONSIDERING THE ITA NO. 74 & 75/AGRA/2014 3 REASONS RECORDED FOR REOPENING OF ASSESSMENT IN THE APPELLATE ORDER CONFIRMED THE REOPENING OF ASSESSMENT. ON MERITS THE ASSESSEE FI LED REVISED COMPUTATION TO SHOW THAT THE LONG-TERM CAPITAL GAIN WAS EARNED IN A SUM OF RS.11 02 152/- WHICH WAS ACCEPTED BY THE LD. CIT(A) AND ACCORDINGLY THE APP EAL OF THE ASSESSEE WAS PARTLY ALLOWED. 4. IN ASSESSMENT YEAR 2005-06 THE FACTS ARE SAME E XCEPT DIFFERENCE IN KHASRA NUMBER OF THE PROPERTY. THE AO ON THE SAME FACTS AS IN ASSESSMENT YEAR 2006-07 COMPUTED THE LONG TERM CAPITAL GAINS AT RS.3 95 440 /-. THE REOPENING OF ASSESSMENT AND ADDITION ON MERITS WERE CHALLENGED B EFORE THE LD. CIT(A) WHO HAS CONFIRMED REOPENING OF ASSESSMENT. HOWEVER THE REV ISED COMPUTATION OF CAPITAL GAINS SUBMITTED BY THE ASSESSEE WAS ACCEPTED FOR RS .1 17 120/- AND THE APPEAL OF THE ASSESSEE WAS PARTLY ALLOWED. 5. THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET S UBMITTED THAT IN BOTH THE APPEALS THE PROPERTY UNDER REFERENCE SHOWING CAPIT AL GAIN WAS HELD JOINTLY BY THE ASSESSEE WITH HIS BROTHER SHRI RAMESHWAR. THE APPEA L OF BROTHER OF ASSESSEE SHRI RAMESHWAR S/O DAYARAM ALIAS KALLU IN ASSESSMENT YEA R 2006-07 IN ITA NO. 20/AGRA/2014 HAS BEEN DECIDED BY THE ITAT AGRA BEN CH VIDE ORDER DATED 28.02.2014 ON IDENTICAL FACTS AND REOPENING OF ASSE SSMENT HAVE BEEN QUASHED AND ADDITIONS HAVE BEEN DELETED. COPY OF THE ORDER IS F ILED IN THE PAPER BOOK. THE LD. ITA NO. 74 & 75/AGRA/2014 4 DR ACCEPTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE ON IDENTICAL FACTS BY THE ORDER OF ITAT AGRA BENCH IN THE CASE OF BROTHE R OF ASSESSEE AND JOINT OWNER OF THE PROPERTY UNDER REFERENCE SHRI RAMESHSHWAR ( SUPRA). 6. ON CONSIDERATION OF THE FACTS OF THE CASE IN THE LIGHT OF REASONS FOR REOPENING OF ASSESSMENT RECORDED IN THE CASE OF ASSESSEE AND HIS BROTHER SHRI RAMESHSHWAR WE FIND THAT THE ISSUE IS IDENTICAL IN THE CASE OF ASSESSEE WITH THE FACTS OF THE CASE OF HIS BROTHER RAMESHWAR WHO JOINTLY HELD THE PROP ERTY UNDER REFERENCE. THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER O F ITAT AGRA BENCH IN THE CASE OF SHRI RAMESHWAR S/O DAYARAM ALIAS KALLU (SUPRA) IN WHICH THE ITAT AGRA BENCH HELD IN PARA 5 TO 7 AS UNDER : 5. THE ASSESSEE IN THE PRESENT APPEAL CHALLENGED THE REOPENING OF THE ASSESSMENT AND LEARNED COUNSEL FOR THE ASSESSEE AT THE OUTSET SUBMITTED THAT ON IDENTICAL ISSUE ITAT AGRA BENCH IN THE CASE OF BADAM SINGH RAJPALI VS. ITO IN ITA NO. 358/ AGRA/2011 FOR A.Y. 2004-05 QUASHED THE REOPENING OF THE ASSESSMEN T VIDE ORDER DATED 22.06.2012. COPY OF THE ORDER IS PLACED ON RE CORD. LEARNED D.R. ACCEPTED THAT ISSUE IS COVERED IN FAVOUR OF THE ASS ESSEE ON IDENTICAL FACTS. 6. ON CONSIDERATION OF THE FACTS OF THE CASE IN TH E LIGHT OF THE REASON FOR REOPENING OF THE ASSESSMENT RECORDED WE FIND THAT ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY ORDER OF ITAT AGRA BENCH IN THE CASE OF SHRI BADAM SINGH RAJPALI VS. ITO (SUPRA) IN WHICH THE FACTS AND FINDING ARE REPRODUCED AS UNDER :- ITA NO. 74 & 75/AGRA/2014 5 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASS ESSEE HAD SOLD CERTAIN AGRICULTURE LAND ON 05.08.2003 FOR A SUM OF RS.19 50 000/-. AS PER THE AO THE ASSESSEE HAD NOT FILED ANY INCOME T AX RETURN SHOWING CAPITAL GAIN ARISING OUT OF SALE OF AGRICULTURE LAN D. INFORMATION WAS RECEIVED BY THE AO FROM ITO 6(3) JHANSI THAT DURIN G THE YEAR ASSESSEE HAD SOLD THE LAND TO M/S. SAHARA CITY HOME S (P) LTD. FOR A CONSIDERATION OF RS.19 50 000/- WHEREAS THE LAND VA LUE AS PER GOVT. RATE WAS RS.11 40 000/-. ON RECEIPT OF THIS INFORMA TION THE AO HAD ISSUE NOTICE U/S. 133(6) WAS NOT REPLIED. THE REASO NS AS RECORDED BY THE AO FOR ISSUANCE OF NOTICE U/S. 148 ARE REPRODUC ED AS UNDER : REASONS RECORDED U/A. 148(2) OF THE IT ACT 1961 IN THE CASE OF SHRI BADAM SINGH RAJPOOT S/O SHRI RAM PRASAD R/O 195 O/S UNNAO GATE DISTT. JHANSI AY 2004-05. THE ITO 6(3) JHANSI HAS INFORMED THAT DURING THE ASSESSMENT PROCEEDINGS IN THE CASE OF M/S. SAHARA CITY HOMES ( P) LTD. JHANSI IT WAS NOTICED THAT ABOVE ASSESSEE HAS SOLD LAND WORTH RS.19 50 000/- ON 05.08.2003 & AS PER GOVT. VALUE RS.11 40 000/-. IN ORDER TO MAKE CONFIRMATION WITH REGARD TO VALUE OF LAND A NOTICE U/S. 133(6) WAS ISSUED AND SERVED UPON THE ASSESSEE. IT WAS REQUIRE D IN THE NOTICE TO CONFIRM LAND TRANSACTION AND ALSO TO INTIMATE AS TO HOW THE CAPITAL GAIN ARISE OUT OF LAND TRANSACTION HAS BEEN REFLECT ED IN HIS/HER RETURN OF INCOME. SINCE LAND SITUATES WITHIN THE 8 KM. FRO M THE JHANSI MUNICIPALITY LIMIT ASSESSEE WAS LIABLE FOR PAYMENT OF CAPITAL GAIN TAX ON THE ABOVE TRANSACTION OF LAND AS PER INCOME TAX ACT 1961. HOWEVER ASSESSEE HAS FAILED TO SUBMIT REPLY IN THI S REGARD. IT GOES TO SHOW THAT INCOME CHARGEABLE TO TAX ARISING OUT OF C APITAL GAIN HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SEC. 147 O F THE IT ACT 1961. ACCORDINGLY PROCEEDINGS U/S. 147 IS INITIATE D AND ISSUED NOTICE U/S. 148 OF THE IT ACT 1961. 2.1 THE ASSESSEE CHALLENGED THE REASSESSMENT PROCEE DINGS AND ADDITION ON MERITS BEFORE THE LD. CIT(A) AND SUBMIS SIONS OF THE ASSESSEE HAVE BEEN INCORPORATED IN THE IMPUGNED ORD ER. IT WAS EXPLAINED THAT THE VALUE OF LAND AS ON 01.04.1981 W AS HIGHER THAN THE CONSIDERATION AMOUNT. THEREFORE NO RETURN OF INCOM E WAS FILED BEING THE INCOME NOT LIABLE FOR INCOME-TAX. IT WAS EXPLAI NED THAT THE REASONS RECORDED FOR REOPENING OF ASSESSMENT ARE WITHOUT DA TE. THE REASONS WERE RECORDED ON THE BASIS OF INFORMATION RECEIVED FROM ANOTHER ITA NO. 74 & 75/AGRA/2014 6 OFFICER AND THE AO HAS NOT APPLIED HIS MIND TO SATI SFY HIMSELF THROUGH HIS OWN ENQUIRY. THERE S NO MENTION THAT THE AO WAS HAVING REASON TO BELIEVE THAT THE ASSESSEE HAS CONCEALED THE PARTICU LARS OF INCOME. THE SALE CONSIDERATION CANNOT BE TREATED AS INCOME. THE AO ISSUED NOTICE TO VERIFY THE TRANSACTION AND WAS NOT AWARE WHETHER CAPITAL GAINS ARISE OR NOT. EXPRESSION REASON TO BELIEVE DOES N OT MEAN A PURELY SUBJECTIVE SATISFACTION ON THE PART OF THE AO. THE REASONS MUST BE HELD IN GOOD FAITH AND CANNOT BE MERE PRETENCE. THE DETA ILED SUBMISSIONS OF THE ASSESSEE ON MERITS ARE ALSO NOTED IN THE IMP UGNED ORDER. THE LD. CIT(A) CONSIDERING THE ISSUE OF REOPENING OF AS SESSMENT NOTED IN PARA 2.2 OF THE APPELLATE ORDER THAT AT THE STAGE O F INITIATION OF REASSESSMENT PROCEEDINGS U/. 148 OF THE IT ACT IT IS A TRITE LAW THAT THE AO SHOULD HAVE REASON TO BELIEVE THAT INCOME ASSESS ABLE TO TAX HAS ESCAPED ASSESSMENT. IT NEED NOT TO PROVE CONCLUSIVE LY AND ACCORDINGLY UPHELD THE REASSESSMENT PROCEEDINGS U/ S. 148 OF THE IT ACT AND DISMISSED THE APPEAL OF THE ASSESSEE ON THI S REASON. 3. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LD. CIT(A) AND SUBMITTED THAT INGRE DIENTS OF SECTION 147 OF THE ACT HAVE NOT BEEN SATISFIED IN THIS CASE . THEREFORE REOPENING OF ASSESSMENT IS BAD IN LAW. ON THE OTHER HAND THE LD. DR RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIAL ON RECORD. THE REASONS FOR REOPENING OF ASSESSMENT HAV E BEEN INCORPORATED IN THE IMPUGNED ORDER WHICH IS ALSO R EPRODUCED ABOVE. COPY OF SAME IS ALSO FILED AT PAGE 11 OF THE PAPER BOOK. ACCORDING TO SECTION 147 OF THE IT ACT THE ESSENTIAL INGREDIENT OF THIS SECTION HAS BEEN THAT IF THE ASSESSING OFFICER HAS REASON TO B ELIEF THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT IN ANY ASSESSMENT YEAR.. THEREFORE BEFORE INVOKING JURISDICTION U /S. 147 OF THE IT ACT THE ASSESSING OFFICER SHALL HAVE REASON TO BEL IEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. TH E AO FOR THE REASONS RECORDED FOR REOPENING OF ASSESSMENT AS MEN TIONED ABOVE HAS NOT MENTIONED ANYTHING IN THE REASONS IF HE WAS HAV ING REASONS TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED A SSESSMENT. HE HAS MERELY RECEIVED INFORMATION FROM ITO 6(3) JHANSI T HAT THE ASSESSEE HAS SOLD THE LAND ON 05.08.2003 AT THE HIGHER RATE AS AGAINST GOVERNMENT VALUE. THE AO HAS NOT VERIFIED THE INFOR MATION ISSUED ITA NO. 74 & 75/AGRA/2014 7 NOTICE U/S. 133(6) TO THE ASSESSEE AND REQUIRED TO CONFIRM THE TRANSACTION AS TO HOW THE CAPITAL GAINS ARISE OUT O F THE TRANSACTION. IT WOULD MEAN THAT THERE WAS NO DEFINITE INFORMATION R ECEIVED FROM ITO 6(3) JHANSI THAT THE ASSESSEE EARNED ANY CAPITAL G AINS OUT OF THE SALE TRANSACTION OF LAND IN QUESTION. THERE WAS NO MATER IAL WITH THE AO TO PRIMA FACIE PROVE THAT THE ASSESSEE EARNED CAPITAL GAIN BECAUSE HE WANTED THE ASSESSEE TO INTIMATE AS TO HOW CAPITAL G AIN ARISES OUT OF THE TRANSACTION. SINCE NO REPLY WAS SUBMITTED IN TH IS REGARD BEFORE THE AO THEREFORE THE AO PRESUMED THAT THE INCOME CHAR GEABLE TO TAX HAS ESCAPED ASSESSMENT AND HE INITIATED PROCEEDINGS U/S . 147 OF THE IT ACT. THE REASONS RECORDED BY THE AO THEREFORE DO NOT SATISFY THE REQUIREMENT OF SECTION 147 OF THE IT ACT. THE AO HA D NOT EXAMINED THE INFORMATION RECEIVED FROM THE ITO 6(3) JHANSI BEFORE RECORDING THE REASONS FOR REOPENING OF ASSESSMENT. THE AO HAD ACTED ONLY ON THE BASIS OF SUSPICION AND IT COULD NOT BE SAID THA T IT WAS BASED ON BELIEF THAT INCOME CHARGEABLE TO TAX HAD ESCAPED AS SESSMENT. THE ASSESSING OFFICER HAD TO ACT ON THE BASIS OF REASO N TO BELIEVE AND NOT ON REASON TO SUSPECT. THE INFORMATION RECEIVE D FROM ITO 6(3) DID NOT INDICATE AS TO HOW CAPITAL GAINS ARISE IN T HE CASE OF ASSESSEE AND THE AO MERELY ACCEPTED TRUTH IN VAGUE INFORMATI ON IN A MECHANICAL MANNER AND PUT THE ASSESSEE UNDER OBLIGA TION TO FILE REPLY TO THE SAME. MERELY BECAUSE NO REPLY WAS FILED THE AO ACTED IN HASTE AND INITIATED PROCEEDINGS U/S. 147 OF THE IT ACT WI THOUT RECORDING SATISFACTION FOR INITIATION OF PROCEEDINGS IN THE M ATTER. HONBLE SUPREME COURT IN THE CASE OF SHEO NATH SINGH VS. AP PELLATE ASST. COMMISSIONER OF INCOME-TAX 82 ITR 147 HELD THE WORDS REASON TO BELIEVE SUGGEST THAT THE BE LIEF MUST BE THAT OF AN HONEST AND REASONABLE PERSON BASED UPON REASONABLE GROUNDS AND THAT THE 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 JURI SDICTION IF THE REASON FOR HIS BELIEF THAT THE CONDITIONS ARE SATIS FIED DOES NOT EXIST OR IS NOT MATERIAL OR RELEVANT TO THE BELIEF REQUIRED BY THE SECTION. THE COURT CAN ALWAYS EXAMINE THIS ASPECT THOUGH THE DEC LARATION OR SUFFICIENCY OF THE REASONS FOR THE BELIEF CANNOT BE INVESTIGATED BY THE COURT. ITA NO. 74 & 75/AGRA/2014 8 4.1 HONBLE DELHI HIGH CURT IN THE CASE OF CIT VS. ATUL JAIN & SMT. VINITA JAIN 299 ITR 383 HELD THERE MUST BE REASON TO BELIEVE WARRANTING THE ISSUANCE OF A NOTICE OF REASSESSMENT BY THE ASSESSING OFFICER. IF THERE ARE NO REASONS THEN THE ENTIRE FOUNDATION FOR INITIATING THE PROCEEDINGS IS BAD AND THE NOTICE INITIATING PROCEEDINGS MUST BE Q UASHED. MERE SATISFACTION OF THE ASSESSING OFFICER FOR THE ISSUA NCE OF A NOTICE IS NOT ENOUGH THERE MUST BE REASONS ON RECORD WHICH LED H IM TO BELIEVE THAT A NOTICE SHOULD BE ISSUED. AFTER A FOUNDATION BASED ON INFORMATION IS SET UP THERE MUST STILL BE SOME REASONS WHICH WARR ANT THE HOLDING OF A BELIEF SO AS TO NECESSITATE THE ISSUANCE OF A NOT ICE UNDER SECTION 148 OF THE INCOME-TAX ACT 1961. THE ASSESSEE PURCHASED SHARES AND SUBSEQUENTLY SOL D THESE SHARES AT A MUCH HIGHER VALUE. FOR THE ASSESSMENT Y EAR 1997-98 THE ASSESSEES DISCLOSED LONG-TERM CAPITAL GAINS ARISING FROM THE TRANSACTION. ON THE BASIS OF THE INFORMATION RECEIV ED BY THE DEPUTY DIRECTOR (INVESTIGATION) THE ASSESSING OFFICER ISS UED NOTICE UNDER SECTION 148. THE FILES WERE THEN PUT UP BEFORE THE COMMISSIONER AND IN RESPONSE TO THE QUESTION WHETHER THE COMMISSIONE R WAS SATISFIED THAT INCOME HAD ESCAPED ASSESSMENT HE WROTE YES. THEREAFTER THE ASSESSING OFFICER REASSESSED THE INCOME AND CHARGED INTEREST AND LEVIED PENALTY. THE COMMISSIONER (APPEALS) ALLOWED RELIEF PARTLY BUT THE TRIBUNAL CONCLUDED THE ISSUE IN FAVOUR OF THE A SSESSEES. ON APPEAL: HELD DISMISSING THE APPEALS THAT THE ONLY INFORM ATION WAS THAT THE ASSESSEE HAD TAKEN A BOGUS ENTRY OF CAPITAL GAI NS BY PAYING CASH ALONG WITH SOME PREMIUM FOR TAKING A CHEQUE FOR THA T AMOUNT. THE INFORMATION DID NOT INDICATE THE SOURCE OF THE CAPI TAL GAINS WHICH IN THIS CASE WERE SHARES. THERE WAS NO INFORMATION WHI CH SHARES HAD BEEN TRANSFERRED AND WITH WHOM THE TRANSACTION HAD TAKEN PLACE. THE ASSESSING OFFICER DID NOT VERIFY THE CORRECTNESS OF THE INFORMATION RECEIVED BY HIM BUT MERELY ACCEPTED THE TRUTH OF TH E VAGUE INFORMATION IN A MECHANICAL MANNER. THE ASSESSING O FFICER HAD NOT EVEN RECORDED HIS SATISFACTION ABOUT THE CORRECTNES S OR OTHERWISE OF THE INFORMATION FOR ISSUING A NOTICE UNDER SECTION 148. WHAT HAD BEEN RECORDED BY THE ASSESSING OFFICER AS HIS REASONS T O BELIEVE WAS NOTHING MORE THAN A REPORT GIVEN BY HIM TO THE COMM ISSIONER. THE ITA NO. 74 & 75/AGRA/2014 9 SUBMISSION OF THE REPORT WAS NOT THE SAME AS RECORD ING OF REASONS TO BELIEVE FOR ISSUING A NOTICE. THE ASSESSING OFFICER HAD CLEARLY SUBSTITUTED FORM FOR SUBSTANCE AND THEREFORE THE AC TION OF THE ASSESSING OFFICER WAS NOT SUSTAINABLE. 4.2 HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. SMT. PARAMJIT KAUR 311 ITR 38 HELD THE ASSESSEE FILED HER ORIGINAL RETURN DECLARING NIL INCOME. THE ASSESSING OFFICER INITIATED REASSESSMENT PROCEE DINGS ON THE BASIS OF INFORMATION RECEIVED FROM THE SURVEY CIRCLE THAT THE ASSESSEE HAD GOT PREPARED A DEMAND DRAFT FOR A SUM OF RS.83 040 WHICH WAS NOT ACCOUNTED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. ON APPEAL BY THE ASSESSEE THE FIRST APPELLATE AUTHORITY UPHELD THE V ALIDITY OF THE NOTICE UNDER SECTION 148 OF THE INCOME-TAX ACT 1961 BUT SET ASIDE THE ASSESSMENT ON THE ADDITION MADE BY THE ASSESSING OF FICER AND REMITTED THE MATTER TO HIM TO FRAME A FRESH ASSESSM ENT. ON SECOND APPEAL THE TRIBUNAL HELD THAT SINCE THE ASSESSING OFFICER FAILED TO INCORPORATE THE MATERIAL AND ITS SATISFACTION FOR R EOPENING THE ASSESSMENT THE SAME WAS INVALID. ON A REFERENCE : HELD THAT THE ASSESSING OFFICER HAD NOT EXAMINED THE INFORMATION RECEIVED FROM THE SURVEY CIRCLE BEFORE RECORDING HIS OWN SATISFACTION OF ESCAPED INCOME AND INITIATING REASS ESSMENT PROCEEDINGS. THE ASSESSING OFFICER HAD THUS ACTED O NLY ON THE BASIS OF SUSPICION AND IT COULD NOT BE SAID THAT IT WAS BASE D ON BELIEF THAT THE INCOME CHARGEABLE TO TAX HAD ESCAPED INCOME. THE AS SESSING OFFICER HAD TO ACT ON THE BASIS OF REASONS TO BELIEVE AND NOT ON REASONS TO SUSPECT. THE TRIBUNAL RIGHTLY CONCLUDED THAT THE A SSESSING OFFICER HAD FAILED TO INCORPORATE THE MATERIAL AND HIS SATI SFACTION FOR REOPENING THE ASSESSMENT AND THEREFORE THE ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT FOR REASSESSMENT PROCEEDINGS WAS NOT VALID. 4.3 CONSIDERING THE REASONS FOR REOPENING OF ASSESS MENT IN THE LIGHT OF ABOVE DISCUSSION AND THE CASE LAWS REFERRE D TO ABOVE WE ARE OF THE VIEW THAT THE AO HAS NOT SATISFIED THE INGRE DIENTS OF SECTION 147 OF THE ACT IN THE REASONS RECORDED FOR REOPENING OF ASSESSMENT. THEREFORE THE AO HAS NOT CORRECTLY ASSUMED JURISDI CTION U/S. 147 / ITA NO. 74 & 75/AGRA/2014 10 148 OF THE IT ACT. ACCORDINGLY WE SET ASIDE THE OR DERS OF THE AUTHORITIES BELOW AND QUASH THE REASSESSMENT PROCEE DINGS. IT WOULD RESULT IN DELETION OF ALL THE ADDITIONS. GROUND NO. 1 OF APPEAL OF ASSESSEE IS ACCORDINGLY ALLOWED. IN VIEW OF THIS THE OTHER GROUNDS HAVE ONLY ACADEMIC INTEREST AND AS SUCH WE DO NOT FIND IT NECESSARY TO DECIDE THE ISSUE ON MERITS. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALL OWED. 7. IN VIEW OF THE ABOVE THE ORDERS OF THE AUTHORIT IES BELOW ARE QUASHED AND THE ADDITION MADE STANDS DELETED. 7. IN VIEW OF THE ABOVE AND FOLLOWING THE ORDER OF ITAT AGRA BENCH IN THE CASE OF SHRI RAMESHSHWAR (SUPRA) THE ORDERS OF AUT HORITIES BELOW ARE QUASHED AND THE ADDITIONS STAND DELETED. 8. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (PRAMOD KUMAR) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) CONCERNED BY ORDER 4. CIT CONCERNED 5. DR ITAT AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY