TaxTMI 
TaxTMI 
2016 (5) TMI 1588
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.....(Invt.). It was re-opened on satisfaction of D.D.I. and not having reasons to believe of A.O. It is against the spirit of Hon'ble Punjab & Haryana High Court's case law of Paramjit Kaur 168 Taxman 39. 4. Recent decision of Hon'ble ITAT Chandigarh Bench in appeal no.282 & 389 of 2014 pronounced on 18/11/2015 and published under citation no. (2016) 65 Taxman.com 2016 in the case of Subash Chander Goel vs. ITO Ward 1(3), Chandigarh is very much a covered case for our case for quashing proceedings u/s. 148. 5. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off." 3. The legal issue raised by the assessee in this appeal relates to validity of reopening of the assessment under section 147 of the Income Tax Act, 1961 (in short 'the Act'). For assessment year 2005-06, the assessee (individual) submitted his return of income on 25.7.2005 declaring total income at Rs,1,79,563/-. The return was processed under section 143(1) of the Act. Subsequently, the Assessing Officer issued notice under section 148 of the Act, dated 31.3.2010 after recording reasons that the assessee had incurred expenditure on Roka an....
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....-. The return was processed u/s 143(1) of the I.T. Act. Later on information was received from DD1T (Inv.)-III, Ludhiana that the assessee Sh Ashok Goel and his daughter Smt Sarita Goel, R/o Old Grain Market, Mullanpur, (Ldh) has spent approximately 37 lacs on his engagement and marriage ceremonies. As per copy of complaint made by the assessee to Senior Supridentent of Police, Ludhiana, Roka and engagement function was solemnized on 29.08.2004 and expenditure of Rs 7 lacs was made on these function further, approximately Rs 30 lacs was spent on the marriage ceremony held on 16.05.2005. Investigation of DDIT (Inv.) shows the expenditure was made out of unexplained income which assessee could not explain before the investigation Wing. 2. I am satisfied that the assessee had incurred expenses of Rs 7 lacs on Roka and engagement ceremony function solemnized on 29.08.2004 out of his un-explained income and income has escaped assessment for the period relevant to the Asstt. Year 2005-06. Issue notice under section 148 of the Income Tax Act, 1961 for the Asstt. Year 2005-06. Yours faithfully Sd/- ( O.P.Saroha ) Dated: 31.03.2010 Income Tax Officer-111(2) Ludhiana 8. The....
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....that FIR was lodged with the police on 11.5.2009 by Ms.Sarika Jain, daughter of the assessee, where some details of expenses of Roka ceremony was given at Rs.7 lacs in her own way just to fetch money from in-laws. According to the learned counsel for the assessee, this estimation made by the daughter of the assessee was used by the Assessing Officer in the hands of Shri Ashok Goel, father of Ms.Sarika Jain. According to the learned counsel for the assessee, the proceedings under section 147 r.w.s. 148 of the Act in the hands of the father i.e. Shri Ashok Goel on the basis of the allegations made by Ms.Sarika Jain against here husband, cannot be made the basis for making the addition. In the instant case, the ground on which the re-assessment notice was issued is not in existence. In the reasons recorded by the Assessing Officer, reproduced here-inabove, the Assessing Officer has categorically stated that as per the copy of complaint made by the assessee to SSP of Police, Ludhiana, Roka and Engagement functions were solemnized on 29.8.2004 and expenditure of Rs.7 lacs was made on these functions. Further, approximately Rs.30 lacs were spent on the marriage ceremony held on 16.5.2005....
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....idled and there are several safeguards. One of the safeguards stipulated in the section itself is the requirement that the Assessing Officer must record 'reasons to believe'. This requirement mandates that the Assessing Officer must state in writing why and for what reason, i.e. cause or justification, he is invoking the said power. The said reasons must satisfy the stipulation that the Assessing Officer should have formed a prima facie belief that income has escaped assessment. 24. 'Reasons to believe' recorded by the Assessing Officer are a result of the subjective satisfaction of the assessing officer, but in a way has to satisfy the test of objectiveness. The belief must be honest and should be based upon some material or basis but not on mere suspicion, gossip or rumour. 'Reasons to believe' do not mean 'reasons to suspect'. The Assessing Officer cannot institute or start a fishing investigation or rowing inquiry. There must be some information or material which is on the file which makes the assessing officer form a tentative or prima facie opinion that income has escaped assessment. This material or information cannot be wholly vague, indefi....
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....d that the Assessing Officer did not have the jurisdiction to proceed with the reassessment, the moment he found the two grounds mentioned in the re-assessment notice incorrect or nonexistent. In the instant case also, notice was issued to the assessee on ground that he had made the complaint to the SSP of Police, which is factually incorrect. In fact, the assessee did not make any complaint to the SSP, Ludhiana. Secondly, the Assessing Officer has mentioned in the reasons recorded that information was received from DDIT (Investigation)-III, Ludhiana that the assessee and his daughter Ms.Sarika Jain had spent approximately Rs.37 lacs on her engagement and marriage ceremony. It is brought to our notice that no addition has been made in the hands of Ms.Sarika Jain. On the contrary, Smt.Sarika Jain alleged in her complaint made with the Police that the assessee had spent an amount of Rs.7 lacs at the time of Roka and Engagement functions. It is also observed that in this case the information was provided by DDIT (Investigation)-III, Ludhiana on the basis of Police Report, wherein the daughter of the assessee alleged that a huge amount has been spent on marriage and Roka ceremony. The ....