TaxTMI 
TaxTMI 
2017 (6) TMI 137
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....s. 6,64,534/- and Rs. 1,62,182/-. The AO therefore formed his belief that assessee has not fully declared the cost of investment and accordingly reopened the assessment under section 147 of the Act by issuing notice under section 148 of the Act after recording the reasons for reopening of the assessment. The Ld. CIT(A) confirmed the reopening of the assessment. 4. Ld. Counsel for the assessee while challenging the reopening of the assessment in all the years referred to the reasons recorded for reopening of the assessment which is similarly in all the assessment years under appeal. Copy of reasons for assessment year 2006-07 are filed at Paper Book page no. 4 which reads as under: ANNEXURE 'A' (REASON FOR THE BELIEF THAT THE INCOME HAS ESCAPED) NAME OF THE ASSESSEE : M/S JAMYANG CHOLING INSTITUTE TARA GUEST HOUSE, MCLEODGANJ DHARAMSHALA, DISTT- KANGRA(H.P.) PAN : AAATJ3512G ASSESSMENT YEAR : 2006-07 Assessee has filed its return of income for the Assessment Year 2006-07 by declaring income at Rs. Nil. Assessment was completed u/s 143(1) of the I.T. Act, 1961 at income of Rs. Nil. As per information available with the department, the assessee d....
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....he cuttings attached with the registered valuer report for the purpose of getting the rates @ 5463/- per sq.yd. This submission shows that there was no basis for the Assessing Officer to refer to the rates of commercial plots @ 5463/- per sq.yd. as on January,1985 because there is no material available on record to show how the Assessing Officer came to know about these rates from Chandigarh Administration. When report of Registered Valuer is available on record, the Assessing Officer did not accept the report of the Registered Valuer but the newspaper cutting attached with the Registered Valuer as per submission of ld. DR have been taken into consideration for the purpose of making reference of value of the commercial plots by Chandigarh Administration which is highly unwarranted. It is not in dispute that earlier, return of income was processed under section 143(1) of the Income Tax Act and at that time, the report of Registered Valuer and the annexures with the report of Registered Valuer were available on record. It, therefore, appears that the Assessing Officer merely on going through the report of Registered Valuer alongwith newspaper cutting, had recorded the reasons for re-....
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....mation of reason to belief, reasons being vague and there is no nexus or live link which is a sine-qua for formation of belief for the purpose of re-opening of the assessment, therefore, the Assessing Officer has wrongly assumed the jurisdiction and therefore, assessment made deserves to be quashed. There is no tangible material available on record to justify re-opening of the assessment. The Assessing Officer had acted only on the basis of suspicion and it could not be said that it was based on belief that income chargeable to tax had escaped assessment. Hon'ble Delhi High Court in the case of Signature Hotels Pvt. Ltd. (supra) has held that, "Even the annexure could not be regarded as a material or evidence that prima facie showed or established nexus or link which disclosed escapement of income". 11(i) The decisions relied upon by ld. counsel for the assessee, therefore, squarely apply to the facts and circumstances of the case. Ultimately the Assessing Officer computed the income of the assessee on the basis of assessment framed in the case of co-owner Shri Arun Mundre on the basis of report of the DVO. The copy of the assessment order in the case of Shri Arun Mundre date....
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....support case of the revenue. 13. Considering the above discussion, it is clear that there was no basis or material on record to calculate the value of land @ Rs. 1000/- per sq.yd. and of the cost of construction at Rs. 100/- per sq.ft. as is noted in the reasons. There is no material, what to say of tangible material available on record to justify re-opening of the assessment. The Assessing Officer merely on assumption, presumption, recording vague and nonexisting reasons, recorded the reasons for re-opening of the assessment which are not sufficient to validate the re-opening of the assessment in the matter. Thus, there is no reason to believe with the Assessing Officer to assume the jurisdiction under section 148 of the Income Tax Act. 13(i) Considering the above discussion, we are of the view that reasons recorded under section 148 of the Act reflect an arbitrary use of power conferred under section 147 of the Act. In this view of the matter, we set aside the orders of authorities below and quash the re-opening of the assessment under section 147/148 of the Income Tax Act. Therefore, there is no need to consider other grounds of appeal on merit because they are left for acad....