2002 (1) TMI 5

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....nder the said Act and, admittedly, they have submitted their returns of income for the assessment years 1972-73 and 1973-74. Although orders of assessment for the said years were passed by the Income-tax Officer concerned, subsequently the Income-tax Officer issued notices under section 148 of the said Act proposing to reopen the assessments in respect of the aforesaid assessment years. The present application under article 226 was moved before this court challenging the said notices under section 148 of the said Act contending, inter alia, that the Income-tax Officer was really harassing the assessee and there was no bona fide reason to reopen the assessments. The learned single judge by the order impugned quashed the aforesaid notic....

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....le to tax has escaped assessment. It is, therefore, proposed to reopen the assessment under section 147(a) of the Income-tax Act for the assessment year 1973-74." The learned judge himself recorded that although several legal contentions have been raised by the assessee before him, but the learned judge was unable to accept any of the said legal propositions. Nevertheless, the learned judge quashed the said notices with the following observations: "The recorded reasons have been set out earlier in the judgment. It will be seen that in the first part it has been recorded that Manick Chand Jain has deposed that he was a name-lender. Thereafter, it has been recorded that Manick Chand was carrying on business in the names of Gulab Chand J....

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....mission or failure on the part of the assessee to make a return of his income under section 139, or (b) omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for that year. Both these conditions were conditions precedent to be satisfied before the Income-tax Officer could assume jurisdiction to issue a notice under section 148, read with section 147(a) of the said Act. The Supreme Court of India in the case of ITO v, Lakhmani Mewal Das [1976] 103 ITR 437 observed that the reasons for the formation of the belief contemplated by section 147(a) of the said Act for the reopening of an assessment must have a rational connection or relevant bearing on the formation of the be....

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....y part of his income, profits or gains chargeable to income-tax had escaped assessment. He might start reassessment proceedings either because some fresh facts had come to light which were not previously disclosed or some information with regard to the facts previously disclosed came into his possession, which intended to expose the untruthfulness of those facts. In such situations, it was not a case of mere change of opinion or the drawing of a different inference from the same facts as were earlier available, but one of acting on fresh information. Since the belief is that of the Income-tax Officer, sufficiency of the reasons for forming the belief was not for the court to judge, but it was open to an assessee to establish that there in f....