2019 (9) TMI 778

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.... without examining the nexus between the material available on the record and the A.O.'s satisfaction about escapement of income of the year under consideration ? 2. Whether the finding of the Tribunal that the addition of Rs. 1,35,000/- was vitiated in view of the material placed on record ? 3. Whether the Tribunal was right in law in holding the addition of Rs. 1,35,000/- by giving a finding which was neither the case of the Assessing Officer, nor the CIT (A) ? 4. Whether the Tribunal was right in law in holding that the issue about the amount advanced to Sh. H.C.Chopra was not before the Assessing Officer at the time of framing the original assessment when the same has been duly discussed in the proceedings u/s 132 (5) ?" ....

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....on which is now before this Court. 4. Learned counsel for the assessee has relied upon Commissioner of Income Tax versus Kelvinator of India (2010) 34 DTR (SC) 49 where in the similar question the Supreme Court has held as follows:- "4. On going through the changes, quoted above, made to Section 147 of the Act, we find that, prior to Direct Tax Laws (Amendment) Act, 1987, re-opening could be done under above two conditions and fulfillment of the said conditions alone conferred jurisdiction on the Assessing Officer to make a back assessment, but in section 147 of the Act [with effect from 1st April, 1989], they are given a go by and only one condition has remained, viz., that where the AO has reason to believe that income has escaped as....

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....tations from the Companies against omission of the words "reason to believe", Parliament re-introduced the said expression and deleted the word "opinion" on the ground that it would vest arbitrary powers in the Assessing Officer. We quote hereinbelow the relevant portion of Circular No.549 dated 31st October, 1989, which reads as follows: "7.2 Amendment made by the Amending Act, 1989, to reintroduce the expression 'reason to believe' in Section 147-- A number of representations were received against the omission of the words 'reason to believe' from Section 147 and their substitution by the 'opinion' of the Assessing Officer. It was pointed out that the meaning of the expression, 'reason to believe' had been explained....

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....imony was absolutely necessary to decide the issue as on the basis of his letter the impugned notice under Section 148 of the Act was issued, nowhere mentioned either the dates or the amounts sent from time to time but the A.O. never acceded to this request which is against trite law that in case the request of the assessee to summon the creditor is not acceded to by the department, it will not justify the addition on that count. It was further pleaded that the department has accepted this fact and no further reference or appeal was filed before this Hon'ble Court. 6. Learned counsel appearing on behalf of the revenue has not been able to show how and in what circumstances the letter which had already been perused and considered could....