TaxTMI 
TaxTMI 
2018 (11) TMI 1953
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....bject matter of Chargesheet/Case Diary filed in Crime No. 220/14 u/s 467,468,471,1206,420 Indian Penal Code(IPC) P.S. Kotwali Nagar, Faizabad. 2. Because the Ld. CIT(A) has failed to appreciate that post - deposit of cash, money was primarily used to purchase cement being business of accused and buy insurance policies in the name of the accused in crime No. 220/14 P.S. Kotwali Nagar, Faizabad. 3. Because the Ld. CIT(A]/AO has failed to appreciate that real beneficiaries of forged transactions were accused who should have been subjected to tax and penal action under the Income Tax Act, 1961. 4. Because the Ld. CIT(A)/AO has failed to appreciate that the appellant is a small farmer and labourer and was earning nomin....
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....dditional ground, the ld. counsel for the assessee has contended that the AO had no material to form reason of belief of escapement of income and so, the notice issued u/s 148 of the I.T. Act and the proceedings pursuant thereto are bad in law; that it is a case of a roving and fishing enquiry, which is not permissible in law; that merely on the basis of AIR information, it cannot be concluded that there is escapement of income. 6. On the other hand, the ld. DR has contended that it was the AIR information, which formed the basis of the AO's belief of escapement of income of the assessee, amounting to Rs. 28,18,210/-, representing cash deposits in the savings bank account of the assessee; that the source of such deposits, the nature ther....
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....rlooking that the sources of the deposits need not necessarily be the income of the assessee; and that as such, the reasons recorded were not sufficient to believe escapement of income; that rather, they were reasons to suspect escapement of income, which was not enough for issuance of a notice u/s 148 of the Act. 8. 'Sijwali' (Supra) has been followed in 'Sh. Ashwani Kumar vs. ITO', order dated 23.02.2016, passed by the ITAT, Amritsar (SMC), in ITA No. 129(Asr)/2015, for A.Y. 2005-06 and in 'Krishna Kumar Tripathi vs. ITO', order dated 31.7.2017, passed by the ITAT, Agra (SMC), in ITA No. 87/Agra/2016, for A.Y. 2011-12. 9. 'Sijwali' (Supra) was also followed in 'Sh. Amrik Singh vs. ITO', order dated 11.05.2016, passed by the ITAT, Am....
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.... some further investigations have not been carried out, which, if made, could have led to detection of an income escaping assessment, this can not be reason enough to hold the view that the income has escaped assessment; and that there has to be some kind of cause and effect of relationship between the reasons recorded and the income escaping assessment. The observations of the Hon'ble Supreme Court in the case of 'ITO vs. Lakhmani Mewal Das', 103 ITR 437 (SC), were reproduced, as under: "the reasons for the formation of the belief must have rational connection with or relevant bearing on the formation of the belief. Rational connection postulates that there must be a direct nexus or live link between the material coming to the not....
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....he reasons so recorded, it is not open to us to deal with the question as to whether the assessee could be said to be engaged in any business; all that is to be examined is whether the fact of the deposits, per se, in the bank account of the assessee could be basis of holding the view that the income has escaped assessment. The answer, in our humble understanding, is in negative. The Assessing Officer has opined that an income of Rs. 10,24,100/- has escaped assessment of income because the assessee has Rs. 10,24,100/- in his bank account but then such an opinion proceeds on the fallacious assumption that the bank deposits constitute undisclosed income, and overlooks the fact that the sources of deposit need not necessarily be income of the ....
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.... Sijwali' (supra), the mere fact that the deposits had been made in the bank account does not indicate that these deposits constitute income which has escaped assessment. 50. Thus, it was a mere suspicion of the AO, that prompted him to initiate assessment proceedings under section 147, which is neither countenanced, nor sustainable in law. Too, the AO proceeded on the fallacious assumption that the bank deposits constituted undisclosed income, over-looking the fact that the source of the deposits need not necessarily be the income of the assessee. That being so, in keeping with 'Bir Bahadur Singh Sijwali' (supra), the reasons recorded to initiate assessment proceedings under section 147 of the Act and all proceedings pursuant ther....