TaxTMI 
TaxTMI 
TaxTMI 
2017 (1) TMI 728
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....d style of M/s. Amarlal & Company. For the Assessment Year 1989-90, the Petitioner had filed its return of income on 5th January, 1990 declaring an income of Rs. 1.92lakhs. For the Assessment Year 1990-91, the Petitioner had filed its return of income on 23rd August, 1990, declaring an income of Rs. 1.47lakhs and for Assessment Year 1991-92,, the Petitioner had filed its return of income on 31st August, 1991, declaring an amount of Rs. 40.99 lakhs. 4. For the Assessment Years, 1989-90 and 1990-91, the assessment proceedings were completed by intimation under Section 143(1)(a) of the Act on 9th February, 1990 and 6th March, 1991 respectively. While for the Assessment Year 1991-92, the Assessing Officer completed regular assessment by order dated 31st March, 1992 under Section 143(3) of the Act. 5. In the meantime, on 21/22nd September, 1990, search proceedings were initiated against the Petitioner. Consequent to the search proceedings, two re-opening notices under Section 148 of the Act was issued for the Assessment Years 1989-90 and 1990-91. The Assessing Officer, thereafter by two orders dated 31st March, 1995 passed under Section 148 read with Section 143(3) of the Act, determi....
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....fit/brokerage is written which is not incorporated in A/6 diary :- 18.4.90 2,21,000 Murari shop Khar (Total 4,51,000 - 2,30,000=2,21,000 profit) Total 11,60,500 The above income was not shown by the assessee to his return nor assessed. This income of Rs. 11,60,500/- has escaped assessment. B. The assessee is also buying and selling properties. The details of such dealings are also noted in reasons recorded for A.Y. 1989-90. During the year the receipts from property dealings noted in A/6 diaries are: Date Amount Rs. Description 3.4.90 21,000 Mahink Asha Nagar Deposit flat a/c 4.4.90 25,000 - do - 12.4.90 2,93,000 - do - 16.4.90 1,58,000 Murari shop account Khar 16.4.90 1,55,000 Divya Shah flat (also noted in A/1 on 18.4.90) 24.4.90 1,72,500 Mahink Asha Nagar Flat 401 (Also entry in A/1 24.4.90) 25.4.90 70,615 All account Murd ,, 1,00,000 Manghira Bhayandar ,, 1,30,000 Mahink Flat payment (Also A/1 diary) 2.5.90 35,000 Jasbir shop account ,, 3,48,750 Chand Asha Nagar (Also A/1 diary) ,, 2,50,000 Rahul Murd account 7.5.90 4,00,250 Chandru & Mahink for Asha Nagar (Also in A/1 diary on 8.5.90) ,, 3,0....
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....Asha Nagar (A-1 No.504) 22.8.90 4,500 Chandru Asha Nagar 22.8.90 70,000 Received R Vasu Karjat a/c 27.8.90 2,50,000 Atlanta ,, 17,500 ,, 29.8.90 20,000 Navani Divya A/c 5.9.90 1,00,000 Kamath Deposit A/c Bunglow (A-1) Bunglow Versova) 12.9.90 1,14,000 LFC Kandivli Flat Madai 18.9.90 6,000 Sunrays Murari ,, 25,000 O.P. Sharma There are following receipt entries which are noted in A/1 diary which do not appear in A/6. 3.4.90 1,35,000 Sri Project shop Manish Park Andheri 4.4.90 1,51,000 Shri Project Investment Andheri Manish Park 5.4.90 10,000 Mahink Asha Nagar 6.4.90 75,000 Khys Pratap Bhayandar flat a/c 7.4.90 25,000 Mahink Asha Nagar No.304 13.4.90 20,000 Chandubhai Crystal Deposit 14.4.90 2,93,000 Mahink Asha Nagar flat no.302 Area 550 401 575 18.4.90 1,58,000 Murari Shop Khar Total 451 - 230 = 221 profit 23.4.90 5,00,000 Tik Kukja Sonda Atlanta ,, 10.00,000 -do - LFC 26.4.90 50,000 Murari Divya a/c 26.4.90 1,00,000 Manghiram Bhayander Deposit 7.5.90 3,00,000 Manghi Bhayander Deposit 5.6.90 50,000 Chandrubhai Crystal A/c 6.6.90 36,000 C/o.Madam Flat a/c no. 1502x 950 rate 1....
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.... Total 2,57,77,500 These investments are from 1.4.90 till 21.9.90 (date of search). The assessee could not explain the source of these investments However, if the credit is given for sale proceeds of Rs. 1,16,78,515/- as par para (B), the net investment remains unexplained is Rs. 1,40,98,985/- which has escaped assessment. D. The assessee is a financer. He has not explained the source of finance made. The new amounts given during the year to various parties upto 21.9.90 as per diary A/3 are Rs. 3,29,85,000/- The assessee has not explained, the source of the money advanced to various persons mentioned in A/3 diary. I am therefore of the opinion that this amount of Rs. 3,29,85,000/-is the income of the assessee u/s. 69/69B which has escaped assessment. E. As per A/I diary the assessee paid Rs. 60,000 on 20.4.90 for membership of club for four persons. The source is not explained Similarly he paid Rs. 5,000/- to Shri Ranan as deposit for Toyota Car on 13.6.90. The source is not explained and also paid Rs. 4,35,000/- to purchase 29 bearer bonds @ 15000 per bond on 9.4.90 to Sri Projects. The source of Rs. 4,35,000/- is not explained. Thus the amount of Rs. (60,....
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....oceedings. These allegations are found only in the above Affidavit in reply filed by the Revenue to the Petition. It is submitted that such improvement of reasons by affidavit is not permissible as held by this Court in Hindustan Lever Ltd., v/s. R.B. Wadekar 268 ITR 322. Therefore it is submitted that in the absence of reasons being supplemented, the impugned notices for reopening are a clear case of change of opinion on the same facts. 10. On the other hand, Mr. Mohanty, learned Counsel appearing for the Respondent-Revenue places reliance upon the Affidavit dated dated 12th March, 1988 of one Mr. K. K. Deb Burman, the Commissioner of Income Tax, Central-I, to contend that the Petitioner had misled the Assessing officer in respect of the entries found in the six seized diaries(A- 1 to A-6) to conclude that he is not a financer. Besides, as stated in the affidavit the Petitioner's decoding of the seized diaries(A-1 to A-6) was incorrect. The learned Counsel further states that merely because the necessary evidence in the form of seized dairies were before the Assessing officer during the earlier Assessment proceedings, it would not follow that that there has been a full and tr....
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.... the safeguard against arbitrary reopening of the concluded assessment. The reason recorded cannot be supplemented by filing affidavit or making oral submission, otherwise, reasons which are lacking in material particulars would get supplemented, by the time the matter reaches to the court, on the strength of affidavit or oral submissions advanced." 12. In the above view, any improvement in the reasons recorded as sought to be done by oral submissions on the basis of the affidavit in reply of the Commissioner of Income Tax Mr. K.K. Deb Burman dated 12 May 1988 has to be ignored. The reasons as recorded can alone be subjected to examination, to determine whether it supports the belief that income chargeable to tax has escaped assessment. On minute examination of the reasons recorded, we find that even when reasons recorded are read as a whole, it does not indicate that there has been a failure on the part of the petitioner to disclose fully and truly all facts necessary for assessment. Nor does it state that there has been any misrepresentation on the part of the petitioner. It is on re-examination of the seized diaries(A-1 to A-6) alone, without any fresh material which points to ....