TaxTMI 
TaxTMI 
2007 (5) TMI 50
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.... justified in law in holding that the initiation of proceedings under Section 147/148 of the Income Tax Act, 1961 was bad in law? 3. Filing of paper books is dispensed with. 4. The assessee carries on the business of financing and investment. In respect of the assessment year 1997-98, the assessee filed its return of income declaring an income of Rs.42,700/-. The return was processed under Section 143(1)(a) of the Act on 24th March 1998. 5. On 28th April, 2003, the Assessing Officer received a letter from the Additional Director of Income Tax (Investigation), Unit VII, New Delhi informing him that the assessee was involved in giving and taking bogus entries/transactions during the financial year 1996-97. It appears that the Assessi....
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....d above) has escaped the assessment within the meaning of the proviso to section 147 and clause (b) to the Explanation 2 of this section. Submitted to the Addl. CIT, Range-12, New Delhi for approval to issue notice u/s 148 for the Asstt. Year 1997-98, if approved. 7. The assessee contested the reopening of his assessment before the Commissioner of Income Tax (Appeals) [CIT (A)]. While rejecting the challenge made by the assessee, the CIT (A) held that the assessee had merely disclosed the fact that he had received share application money. What the assessee did not disclose was the true source and nature of the receipt and to this extent, the assessee did not make a full and true disclosure of facts. Since the assessee did not fully and t....
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....st be appreciated that the Supreme Court has said in Raymond Woollen Mills Ltd. v. Income-tax Officer, (1999) 236 ITR 34 that the Court is only required to see whether there is some prima facie material on the basis of which the Revenue could reopen the case. The sufficiency or correctness of the material cannot be gone into at this stage. 10. Applying the law laid down by the Supreme Court, what has to be considered is whether there was some material, even though of a prima facie nature, which would constitute ?information? enabling the Assessing Officer to have a reason to believe that income had escaped assessment. On a perusal of the reasons recorded by the Assessing Officer, it is clear that he had relied upon information received b....
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....he material which leads the Income Tax Officer to form a belief that income has escaped assessment due to the failure of the assessee to fully and truly disclose all material facts. 12. In so far as the present case is concerned, as we have already indicated above, there was material to prima facie come to the conclusion that the assessee had not disclosed all relevant facts truly and fully. There can be no doubt that on the facts of the present case, there was a live link or a direct nexus between the material which suggested escapement of income and the information on the basis of which it could be concluded that income had escaped assessment. The reasons recorded by the Assessing Officer specifically related to a particular transactio....