TaxTMI 
TaxTMI 
2009 (9) TMI 613
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....the course of survey proceedings and post-survey proceedings ignoring the fact that the assessee failed to get it verified by holding that the addition was made solely and exclusively on the basis of loose papers." 3. The assessee has raised the ground~ in its appeal as under: "(1) That the learned CIT(A) was not justified in confirming invocation of proceedings under s. 147. (2) That the learned CIT(A) erred in law and in facts in sustaining service of notice issued under s. 147 as valid." 4. Briefly, the facts are that the assessee derives income from ginning and pressing of Narma Kapas, manufacturing and trading in quilts and medicated cotton wool. A survey under s. 133A of IT Act was conducted on 25th March, 2003 at the busi....
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.... Rui Narma 176 qtls. valuing Rs. 7,12,800. In the stock register, Annex. 12 shown. the stock position of Narma from 31st Oct., 2002 which shows that stock of Rui Narma has not been shown in the regular books of account. Similarly, the assessee has shown the Rui Desi at p. 50 of Annex. 13 weighing 205 qtls. with value of Rs. 3,50,750 as on 1st May, 2002 and in the Rui account which is being maintained in the ledger Annex. 2 at p. 45, wherein no such stock is found as on the date of stock position ascertained in the loose papers. As per p. 9 loose paper of Annex. 15, the assessee was having the stock of Binola as on 31st Dec., 2002 at 3,029 qtls. but on verification from the stock register, it is found that the balance stock of Binola in A....
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.... and Rs. 6,050 made on account of investment in purchase of stock and credit entry arrived at during the course of survey. 8. Learned Counsel for the assessee, Shri Ojha, assailing the order of learned CIT(A) contends that loose papers found and impounded during the course of survey at assessee's premises had duly been considered by the AO in making the original assessment under s. 143(3) of IT Act on 16th March, 2005. Reference was made to assessment order placed at assessee's paper book p. 8: There was thus no justification in taking action to reassess by reappraising the same material. The learned CIT(A) has thus erred in upholding the action to reassess as valid without any just and valid reason. 9. On the other hand, learned Depa....
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....s where income chargeable to tax has escaped assessment on account, inter alia, of the failure of the assessee to disclose fully and truly all material facts. Production of the books of account and other documentary evidence relevant for assessment did not imply a full and true disclosure in the light of Expln. 1 to s. 147. Therefore, the action initiated by the AO did not suffer from any error of jurisdiction to warrant interference from the Court." To the same effect is the judgment rendered by Ahmedabad Bench of the Tribunal in the case of Jt. CIT vs. S.C. Chemicals (2006) 100 TTJ (Ahd) 1072 : (2006) 99 ITD 41 (Ahd) where the AO had overlooked certain material and the reassessment was held valid. 10. We have heard the parties and h....
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...., the same would amount to giving premium to an authority exercising quasi judicial functions to take benefit of its own wrongs. In this view of the matter Full Bench of Hon'ble Delhi High Court in the case of CIT vs. Kalvinator of India Ltd. (2002) 174 CTR (Del)(FB) 617 : (2002) 256 ITR 1 (Del)(FB) has held that s. 147 of IT Act does not postulate conferment of power upon the AO to initiate reassessment proceedings upon a mere change of opinion. 11. The learned counsel for the assessee had relied upon the judgment rendered by High Court of Judicature of Rajasthan in the case of Addl. CIT vs. Ganeshilal Lal Chand (1984) 43 CTR (Raj) 120 : (1985) 154 ITR 274 (Raj) where it was held that where a reassessment notice was issued, on the groun....