AI Drafter 
TaxTMI 
TaxTMI 
2004 (5) TMI 47
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....bmit additional return in the prescribed form in respect of his income for the aforesaid two assessment years. The said impugned notices are alleged to have been issued in the proceedings initiated under sections 148 and 147 of the Income-tax Act, 1961. Assailing the correctness of the said notices, the petitioner has presented these writ petitions. The principal submission canvassed by learned senior counsel appearing for the petitioner is that the impugned notices issued by the respondent are illegal and arbitrary and they are not in consonance with the mandatory provisions of section 148 of the Income-tax Act. Further, he submitted that, in the impugned notices, the respondent has not assigned any reasons for reopening the case for the assessment years 1998-1999 and 1999-2000. To substantiate his submission, he placed reliance on the judgments of the Madhya Pradesh High Court in the case of Arjun Singh v. Asst. Director of Income-tax (Investigation) [2000] 246 ITR 363 and Ajay Singh v. CIT [2000] 246 ITR 363 and also on the judgment of the Gujarat High Court in the case of Birla VXL Ltd. v. Asst. CIT [1996] 217 ITR 1 and submitted that, "the mandatory requirement which is nec....
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....nequivocal admission made by the petitioner before the authority on August 16, 2000, has been intentionally and deliberately suppressed by him in these writ petitions and, on the ground of suppression of material facts also, the writ petitions are liable to be dismissed with costs. I have heard learned senior counsel appearing for the petitioner and learned senior standing counsel for the respondent. After thorough evaluation of the entire materials available on record and the contentions urged by both counsel and on careful perusal of the impugned notices issued by the respondent, vide annexures A and B, it is manifest on the face of the record that the respondent has not committed any error or illegality while issuing the impugned notices and the same were issued in strict compliance of section 148 of the Income-tax Act. Further, it is significant to note here itself that the petitioner himself has appeared before the assessing authority on August 16, 2000, and stated that: "I have converted the lands into NA and paid Rs. 1,21,410 as development charges and Rs. 2,00,000 as cost of land. The cost of land was paid to the above two persons in 1987. I sold so far 56 plots from ....
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.... case. The questions of fact and law are left open to be investigated and decided by the assessing authority. The appellant will be entitled to take all points before the assessing authority." In the case of Dr. V. Mohan Das v. Deputy CIT [1991] 188 ITR 727 (Ker), which reads as follows: "In reply, counsel for the Revenue submitted that the first respondent was not required to state reasons while issuing exhibits P12 and P13. Existence of reason to believe that there was escapement of income is all that is needed to invoke the power under section 148, submits counsel. He relied on the decision in S. Narayanappa v. CIT [1967] 63 ITR 219 (SC) to derive support for his submission. The court observed: "The earlier stage of the proceeding for recording the reasons of the Income-tax Officer and for obtaining the sanction of the Commissioner are administrative in character and are not quasi-judicial. The scheme of section 34 of the Act is that, if the conditions of the main section are satisfied, a notice has to be issued to the assessee containing all or any of the requirements ... There is no requirement in any of the provisions of the Act or any section laying down as a condit....
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....that there are no reasons. The original file made available by learned counsel for the respondent discloses that there are good grounds for reasonable belief to initiate proceedings. Whether the reasons are sufficient to make an assessment or not is a matter to be considered at a later stage, after considering the case of the assessee and other relevant factors. The only requirement is two distinct conditions must be satisfied before the Income-tax Officer can assume jurisdiction to issue notice under section 147(a). First, he must have reason to believe that the income of the assessee has escaped assessment and, secondly, he must have reason to believe that such escapement is by reason of the omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment. If either of these conditions is fulfilled, the competent authority, i.e., the Income-tax Officer, has got the jurisdiction to issue notice. The original records made available by learned counsel for the respondent prove beyond reasonable doubt that there is a prima facie ground to issue notice. The decision is subject to deciding the same on the merits in accordance wi....