AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2018 (7) TMI 816
X X X X Extracts X X X X
X X X X Extracts X X X X
....ellant explaining the sources of funds and thus denied substantial justice to the appellant and also failed to appreciate the cause explained before him for admission of such evidence. 4. Because, in the facts and circumstances of the case, material produced and submissions made, learned CIT (Appeals) has erred in sustaining addition of Rs. 7,09,500/- towards cash deposits in saving bank account. 5. Because, in the facts and circumstances of the case, material produced and submissions made, learned CIT (Appeals) has erred in sustaining addition of Rs. 6,62,000/- towards investment in property. 6. Because, while sustaining the addition towards cash deposits in bank account and investment in property, learned CIT (Appeals) has erred in not considering the binding judicial precedents referred and relied before him." 2. The following additional ground has also been raised: "8. Because the mechanical approval, without application of mind granted by Pr. Commissioner -1, Agra under section 151 for issuing notice dated 23.03.2016 under section 148 of the 'Act' has vitiated the assessment order dated 28.12.2016 and the said assessment is liable to be d....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Sunil Agrawal vs. ITO', in ITA No. 988/Del/2018. 2. 'Virat Credit & Holdings (P) Ltd. Vs. ITO', in CO No. 57/Del/2012 in ITA No.89/Del/2012. 3. 'Hari Ram Gupta vs. ITO', ITA No.5111/Del/2013. 4. 'Tara Alloys Ltd. Vs. ITO', in ITA No.2421/Del/2017. 6. On the other hand, the ld. DR has placed strong reliance on the approval granted by the Additional CIT. The following decisions have been relied on: i. 'S. Narayanappa vs. CIT', 63 ITR 219 (SC). ii. 'Chhugamal Rajpal vs. S.P. Chaliha', 79 ITR 603 (SC). iii. 'CIT vs. M/s G.S. Tiwari and Co.', 38 taxman.com 259 (All). iv. 'M/s Ginni Filaments vs. CIT', Writ Tax No. 1402 of 2004 (All. H.C.) v. 'Sushrut Institute of Plastic Surgery vs. Dy. CIT', Misc. Bench No 219 of 2014 (All. H.C.) vi. 'Sanjay Kumar Agarwal, HUF vs. DCIT', ITA No.290/Agra/2010 (ITAT-Agra). vii. 'ITO vs. Purushottam Das Bangur', 224 ITR 362 (SC). viii. 'Anil Kumar Singhal vs. ITO', 33 taxman. Com 434 (Agra Trib.) (SMC Bench). ix. 'Abdul Majid vs. CIT', 281 ITR 366 (All). 7. Heard. In the above quoted approval granted by the Additional CIT, the approval has bee....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... ranking officer, For these reasons, the Court is satisfied that the findings by the ITAT cannot be disturbed." (B). Hon'ble High Court of Madhya Pradesh in the case of CIT vs. S. Goyanka Lime & Chemicals Ltd. reported in (2015) 56 taxmann.com 390 (MP) has held as under:- "7. We have considered the rival contentions and we find that while according sanction, the Joint Commissioner, Income Tax has only recorded so "Yes, I am Satisfied". In the case of Arjun Singh vs. Asstt. DIT (2000) 246 ITR 363 (MP), the same question has been considered by a Coordinate Bench of this Court and the following principles are laid down:- "The Commissioner acted, of course, mechanically in order to discharge his statutory obligation properly in the matter of recording sanction as he merely wrote on the format "Yes, I am satisfied" which indicates as if he was to sign only on the dotted line. Even otherwise also, the exercise is shown to have been performed in less than 24 hours of time which also goes to indicate that the Commissioner did not apply his mind at all while granting sanction. The satisfaction has to be with objectivity on objective material. 8. If the ca....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... there is not an iota of material on record as to what documents he had perused and what were the reasons for his being satisfied to accord the sanction to initiate the reopening of assessment u/s 148 of the Act." 11. In the case of 'Hari Ram Gupta Vs ITO', in ITA No. 5111/Del/2013 in ITAT, Delhi vide its order dated 07.07.2016 (PBP-63-67) has quashed the assessment based on approval mentioning , as in the present case, "Yes I am satisfied" (Para 6). 12. Again, the ITAT, Delhi Bench in the case of 'M/s Tara Alloys Ltd. Vs. ITO', in ITA No. 2421/Del/2017 (PBP- 68-108) likewise quashed the assessment based on approval mentioning "Yes I am satisfied" that it is a fit case for reopening u/s 147. (Para 8 to 10) 13. In the Hon'ble Supreme Court's Judgment in the case of 'Parashuram Pottery Works Co. Ltd. Vs. ITO', reported in 106 ITR 1 (APB- 109-118), the Hon'ble Apex Court held that "It has been said that the taxes are the price that we pay for civilization. If so, it is essential that those who are entrusted with the task of calculating and realizing that price should familiarize themselves with the relevant provisions and become well-versed with the law on t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....T', Writ Tax No. 1402 of 2004 (All), the assessee had not valued its closing stock as per the provisions of Section 145A of the IT Act. Notice under section 148 was issued, which was challenged before the Hon'ble High Court. The Hon'ble High Court, while sustaining the notice under section 148, held that at this stage, it can be said that there is relevant material on the record to form a reasonable belief that the taxable income of the assessee has escaped assessment, in view of section 145-A of the Act. The present controversy was not involved therein. 19. In 'Sushrut Institute of Plastic Surgery vs. Dy. CIT', the Misc. Bench No. 219 of 2014 (All), the Hon'ble High Court upholding the validity of the notice u/s 148, found that the only requirement of section 147 is that the Assessing Officer must have good reason to believe that some income had escaped assessment. It was observed that 'A bare perusal of letter dated 14.05.2013 (Annexure No.4) written by the Deputy Commissioner of Income Tax Range-VI- Lucknow, shows that in the return for assessment year 2006-07 the petitioner declared its total income "Nil". However, during the said year share capital increases from Rs. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....48 was upheld. These facts are absent herein. 22. In 'Anil Kumar Singhal vs. ITO', 33 taxman.com434 (Agra Trib) (SMC Bench), ITAT upheld the initiation of proceedings under section 148 of the Act after having found that after receipt of report from the Investigation Wing, the AO had applied his mind to such information and had then issued the notice to the assessee. No issue of non-application of mind by the AO, however, stands raised in the present case. 23. In 'Abdul Majid Vs. CIT', 281 ITR 366 (All), the assessee moved an application for addition of grounds in grounds of appeal before Tribunal on the ground that since the reasons were not recorded before issuing the notice, the requirement of section 148(2) was not complied with and, therefore, the proceedings were invalid and void ab initio. However, the ITAT did not permit the assessee to raise this plea. On appeal before the Hon'ble High Court, it was held that even if a plea, relating to lack of jurisdiction of officer on ground that no reason was recorded before issue of notice under section 148(2), is not raised at the first instance before the assessing authority, it can be raised before the appellate au....