TaxTMI 
TaxTMI 
2020 (1) TMI 786
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....uired under Section 147 of the I.T. Act, 1961. Lastly the petitioner has laid a challenge to the orders dated 28.10.2019 and 26.11.2019 disposing of the objections of the petitioner against the issuance of the notice under Section 148 of the I.T. Act, 1961 for the Assessment Year 2012-13. 3. Sri R.R. Agarwal, learned Senior Counsel assisted by Sri Suyash Agarwal, learned counsel for the petitioner contends that the only submission made on behalf of the petitioner is that the mandatory prior approval required under Section 151 of the I.T. Act, 1961 from the Principal Commissioner, Income Tax, Noida, was not obtained before initiation of the aforesaid reassessment proceedings. In the absence of such approval under Section 151 of the I.T. Act, 1961 from the competent authority the proceedings against the petitioner which are assailed in the instant writ petition, have no legs to stand on and are devoid of jurisdiction. This is the sole submission made by the learned Senior Counsel for the petitioner. 4. Per contra, learned counsel for the Revenue, Sri Subham Agarwal calls attention to various assertions made in the orders impugned dated 28.10.2019 and 26.11.2019 to contend that the ....
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....oval of the respondent no. 2, granted u/s 151 (1) of the Act, after accepting the objection of the petitioner relating to the decision of Sabh Infrastructure Ltd. (Supra) & Godawari Saraf (Supra) but no such approval was appended along with the objection dated 26.11.2019, as such the petitioner has reason to believe that no such mandatory approval as provided u/s 151 (1) of the Act, has been granted by the respondent no. 2, in pursuance of the guidelines of Sabh Infrastructure Ltd. (supra)." 10. We are afraid the aforesaid pleading is deficient and does not at all discharge the burden of proof which lay squarely upon the petitioner to reverse the presumption of correctness of the findings in the orders passed by the revisional authorities in discharge of their official duties. There is no reason or basis to decline the presumption of correctness in favour of the said findings so recorded in the orders passed by the revisional authorities regarding approval under Section 151 of I.T. Act, 1961 before initiation of proceedings under Section 148 of the I.T. Act, 1961. This Court has not been shown any reason or material to doubt the correctness of the finding recorded in the orders d....
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....me of assessee Shri Deepak Gupta is appearing at Sr. No. 125 and it is seen that the assessee is one of the beneficiaries and received Rs. 49,10,240/from the sale proceeds of the shares of M/s DLS Exports Pvt. Ltd. From the enquiries conducted, it has been established that M/s DLS Exports Pvt. Ltd, was involved in layering of funds and providing accommodation entries in the form of bogus LTCG/STCL to several beneficiaries and assessee is one of them. I have analysed the details from the return filed by the assessee for A.Y. 201213 and it is seen that the assessee has not declared any Capital Gain in his return of income. It is clear from the details available on record that the assessee has concealed the capital gain of Rs. 40,10,240/has escaped assessment for AY 201213 with the meaning of provisions of Section 147 of the I.T. Act, 1961." 16. Accordingly proceedings under Section 147 of the I.T. Act, 1961 were initiated to assess the escaped income for Assessment Year 2012-13. 17. At this stage it would be apposite to reflect on some relevant aspects of the statements given by Ashok Kumar Kayan under Section 131 of the I.T. Act, 1961 under oath before the income tax authority at ....
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....ome Tax Vs Rajesh Jhaveri Stock Brokers (P) Ltd. reported at (2007) 291 ITR 500. The Hon'ble Supreme Court in Asstt. CIT Vs Rajesh Jhaveri Stock Brokers (P) Ltd (supra) held thus: "Section 147 authorises and permits the Assessing Officer to assess or reassess income chargeable to tax if he has reason to believe that income for any assessment year has escaped assessment. The word 'reason' in the phrase 'reason to believe' would mean cause or justification. If the Assessing Officer has cause or justification to know or suppose that income had escaped assessment, it can be said to have reason to believe that an income had escaped assessment. The expression cannot be read to mean that the Assessing Officer should have finally ascertained the fact by legal evidence or conclusion........At that stage, the final outcome of the proceeding is not relevant. In other words, at the initiation stage, what is required is 'reason to believe', but not the established fact of escapement of income. At the stage of issue of notice, the only question is whether there was relevant material on which a reasonable person could have formed a requisite belief. Whether the mater....
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....ures against an arbitrary exercise of powers under Section 148." 21. Similarly the Division Bench of the Hon'ble Bombay High Court in N.D. Bhatt, IAC Vs I.B.M. World Trading Corporation reported at (1995) 216 ITR 811, construed the ambit of Section 148 and observed as under: " It is also well settled that the reasons for reopening are required to be recorded by the assessing authority before issuing any notice under section 148 by virtue of the provisions of section 148 (2) at the relevant time. Only the reason so recorded can be looked at for sustaining or setting aside a notice issued under section 148. In the case of Equitable Investment Co. (P.) Ltd. vs. ITO [1988] 174 ITR 714 a Division Bench of the Calcutta High Court has held that where a notice issued under section 148 of the IT Act, 1961, after obtaining the sanction of the CIT, is challenged, the only document to be looked into for determining the validity of the notice is the report on the basis of which the sanction of the CIT has been obtained. The IT Department cannot rely on any other material apart from the report." 22. The same principal was reiterated in another Division Bench judgment of the Hon'ble B....
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....ns of the petitioner. The objections of the petitioner were dealt with on a point to point basis. While passing the order dated 26.11.2019 the competent Revenue Authority found that necessary prerequisite of Section 147 that "there should be an escapement of income" stood fulfilled. The reasons recorded in that regard were found to be valid. The authority also noticed the admission of the assessee that he had "incurred Long Term Capital Gain of Rs. 47,43,264/during Financial Year 201112, however, the same has not been disclosed in his ITR." 26. The validity of the refusal of the request of the petitioner to cross examine Ashok Kumar Kayan, Sunil Kumar Kayan, Devesh Kumar Kayan whose statements were part of the material, was also affirmed in the following terms; " In this regard, it is clarified that the undersigned cannot compel any other person for such cross examination as all these persons are not residing within 200 km. From the office of the undersigned. Therefore they cannot be summoned/called upon for such cross examination. The Income Tax Act, 1961 does not have any provision which may empower the undersigned to enforce the cross examination of a third party by the asse....