TaxTMI 
TaxTMI 
2017 (11) TMI 111
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....urse of assessment proceedings for AY 2011-12 the assessee claimed receipt of agricultural activity to the tune of Rs. 31,86,276/- but could not substantiate the claim. The AO made addition and consequently he also issued notice under section 148 of the act dated 29-03-2014 for the AY 2007-08 i.e. the year under consideration, after recording the following reasons under section 147 of the Act. "The assessee filed its Return of income on 31.10.2007 declaring total income of Rs. 16,57,7801- and net agriculture income of Rs. 3115,389/-. The assessment u/s 143(3) was completed on 18. 11 .2009 at the returned income. In the above mentioned case, for the A.Y. 2011-12. the assessee has claimed receipt of agricultural activity to the tune of Rs. 31,86,276/-. The assessee could not substantiate its claim. Further, assessee had claimed Rs. 6,75.000/- as agricultural expenses. The assessee could not substantiate this claim. After verification, it was learnt that assessee has only produced agriculture products to the tune of Rs. 1,86,276/- against which expenses of Rs. 2,81,280/- were incurred. Therefore, the assessment u/s 143(3) was completed on 31 .01.2014 after treating the agri....
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.... the agricultural income being shown by the appellant was sham. It is important to note that the appellant has been showing agricultural income from 2003-04 onwards and each of the year have been completed u/s.143(3) of the I. T. Act, except assessment year 2010-11 and revenue has not found any reason to doubt the veracity of the same." 5. In view of the above, the learned Counsel for the assessee stated that even the details were available before the AO during the course of original assessment proceedings and he drew our attention to the original assessment order dates 18-11-2009, wherein the AO recorded the finding of fact vide Para 4 reads as under: - "4. The assessee's AR filed details of agricultural income received, bank details/ summary, copy of demat account statement, details of investments made, gift confirmation etc." 6. Even otherwise, the learned Counsel for the assessee stated that the reasons recorded clearly shows that the AO beyond four years want to verify the agricultural income declare by the assessee. According to the learned Counsel, once the AO has gone into the details and there is no failure on the part of the assessee to disclose fully and truly all ....
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.... either of the conditions, it deserves to be quashed. However, the officers have many time issued notices for reopening the assessments even beyond four years from the end of the assessment year without fulfillment of any of the legal conditions as stipulated in the first proviso to this section. Such an action of the revenue authorities is strictly challenged by the taxpayers at large in the court of law and courts have quashed the notice issued by Revenue authorities or quashed the re-assessment orders. Hon'ble Supreme Court affirmed the judgment of Hon'ble Allahabad High Court in the case Foramer vs. CIT (2001) 247 ITR 436 (All) wherein Hon'ble Allahabad High court has considered the issue as under: - "Having heard the learned counsels for the parties, we are of the view that these petitions deserve to be allowed. It may be mentioned that a new section substituted section 147 with effect from 1-4-1989. The relevant part of the new section 147 is as follows : "147. Income escaping assessment.-If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to ....
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....were barred by limitation mentioned in the proviso. 11. The learned departmental counsel relied on section 153(3)(ii) of the Act and submitted that there was no bar of limitation in view of the said provision. We do not agree. Section 153 relates to passing of an order of assessment and it does not relate to issuing of notice under section 147/148. Moreover, this is not a case where reassessment is sought to be made in consequence of, or to give effect to, any finding or direction contained in the order of the Tribunal in Boudier Christian's case. As already stated above, Boudier Christian's case related to the employees of the company, whereas the impugned notice has been issued to the company. Hence, it cannot be said that the proposed reassessment in consequence of the impugned notice would be in consequence of, or to give effect to, any findings of the Tribunal in Boudier Christian's case. A direction or finding as contemplated by section 153(3)(ii ) must be a finding necessary for the disposal of a particular case, that is to say, in respect of the particular assessee and in relevance to a particular assessment year. To be a necessary finding it must be direc....