TaxTMI 
TaxTMI 
TaxTMI 
2017 (2) TMI 1107
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.... (4) The ld. CIT(A) has failed to appreciate the core argument advanced and written submissions filed during appeal proceedings and simply brushed aside both, without adjudicating upon the same. (5) The ld. CIT(A) has erred on facts and in law in making unwarranted observation that the AO has established that the appellant firm has failed to make TDS payments particularly when the AO has passed a non speaking order and both the additions have been made without substantiating the points of additions by passing very brief assessment order. (6) The ld. CIT(A) has not at all adjudicated or applied his own mind on the issues on which the AO has arbitrarily made both the additions in the light of written submissions and arguments of the appellant. (7) The ld. CIT(A) has wrongly concluded that the appellant has not raised any objection with regard to validity of proceedings u/s. 148. The issue was orally raised during the course of assessment proceedings soalso at the appellate stage. However, the AO had turned down without incorporating in the body of the assessment order. (8) The ld. CIT(A) has erred on facts and in law in not appreciating that the reassessment proceedings wer....
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....ts the jurisdiction to make the assessment in the hands of the assessee, we proceed to decide the first issue raised by the assessee wherein the assessee has challenged the legal validity of notice issued under section 148 of the Act. 5. Brief facts relating to the issue are that the assessee was a partnership firm which was dealing in oil, petrol, diesel, kerosene, fertilisers, filters, battery water etc. For the year under consideration, the assessee had furnished return of income declaring total income of Rs. 1,43,660/-. The assessment in the hands of the assessee was completed u/s.143(3) of the Act at Rs. 2,85,950/-. Subsequently, on the basis of audit objection raised by the internal audit party, the Assessing Officer recorded the reasons for reopening the assessment and issued noticed u/s.148 of the Act. Thereafter assessment was completed u/s.143(3) r.w.s. 147 of the Act on total income of Rs. 13,56,327/-. The assessee is aggrieved by the reassessment proceedings initiated in the case. The Assessing Officer while passing the assessment order also refers to the audit queries and the information/books produced by the assessee thereafter and worked out the disallowance under s....
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.... section 147/148 of the Act. The statute lays down under section 147 that where the Assessing Officer has reason to believe that any income chargeable to tax had escaped assessment for any assessment year, then, he may, subject to the provisions of section 148 to 153, assess or re-assess such income and also any other income chargeable to tax which has escaped the assessment and which comes to his notice subsequently in the course of the proceedings in this section. The requirement of section 147 of the Act is the satisfaction of the Assessing Officer that any income chargeable to tax has escaped assessment. The reason to believe that escapement of assessment should be of the Assessing Officer. There should be a live link between the reason to believe and escapement of income. In the absence of the same, the Assessing Officer has no jurisdiction to proceed under section 147 of the Act. 10. In the present case the assessee had furnished return of income declaring total income of Rs. 1,43,660/- which was processed under section 143(1) of the Act and also assessment was completed under section 143(3) of the Act on 17-11-2011 on assessed income of Rs. 2,85,950/-. Thereafter on 04-09-2....
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....ther proceedings took place under section 154 of the Act and thereafter reasons were recorded for reopening the assessment under section 147 of the Act. He pointed that before the Assessing Officer no objections were raised against the initiation of reassessment proceedings, however, before the CIT(A) the assessee had filed objections which were rejected on the ground that no stand against reassessment proceedings was taken before the Assessing Officer. The CIT(A) has dismissed the claim of the assessee on that basis. 12. We find no merit in the order of the CIT(A) in dismissing the plea of the assessee on preliminary basis wherein the issue being purely legal issue can be raised at any point of time. 13. Now coming to the issue raised wherein the Assessing Officer while passing the order under section 143(3) r.w.s. 147 of the Act admits that consequent to the assessment order passed u/s.143(3) of the Act, audit objections by internal audit party vide their audit query No.ITO(AUDIT)- II/NASHIK/2011-12/1085/61 dated 02-02-2012 was received and the case was reopened under section 148 of the Act after obtaining prior approval of the Commissioner of Income Tax-2, Nashik. The assessee....
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....ands of the assessee is of the Assessing Officer himself and not of any other party as pointed out in the paras hereinabove. The basis for recording the reasons for reopening the assessment is the audit objection raised in the case of assessee. The Assessing Officer while passing assessment order dated 23-03-2015 categorically admits that "however consequent upon audit objections by the internal audit party vide their audit query dated 02-02-2012, the case was reopened under section 148 of the Act, 1961, after obtaining prior approval of the Commissioner of Income-tax-II, Nashik." where the initiation of reassessment proceedings are on the basis of audit objection and not on the basis of independent satisfaction of Assessing Officer and hence not valid, is the issue before us. 16. We find support from the ratio laid down by the Hon'ble Supreme Court in the case of Indian & Eastern Newspaper Society Vs. CIT reported in 119 ITR 0996 wherein the Hon'ble Supreme Court held that the information referred to in section 147 of the Act contemplates information as to the law created by formal source. The Hon'ble Supreme Court further held that opinion of the internal party on a point of law....