AI Drafter 
TaxTMI 
TaxTMI 
2025 (6) TMI 637
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....he Ld. CIT(A) has erred in not accepting the contention that letter dated 10.11.17 obtained from the appellant for withdrawl of her objections to proceeding under section 148 is on account of false assurance by the assessing office, which is also not fulfilled by the AO. 3. The Ld. CIT(A) has erred in confirming the addition of Rs. 56.58.858/- not accepting the explanation and evidence filed. 4 The order of Ld CIT(A) is against law and facts of case 5. The appellant craves the right to add, amend or withdraw any grounds of appeal at the time of hearing." 3. Sequence of events are noted below: 28-3-2011 Return of income filed at the income of Rs. 1298450/- at Saharanpur 13.8.13 to 3.8.16 Various notices issued u/s 133(6) by AO Sahranpur and duly replied with evidence. 23.3.2017 Notice u/s 148 issued by ITO Meerut at the address A-38, Defence colony, Meerut 5.7.2017 Notice u/s 142(1) issued by ITO Meerut at the address 44, Mission compound Sahranpur. 13.7.2017 Reply filed by the Appellant with desired documents. 18.8.2017 Case transferred from Meerut to Sahranpur 8.9.17 Notice u/s 143(2) issued by DCIT Saharanpur....
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....order of ITAT Agra Bench in the case of S N Bhargawa (supra). It is, therefore, clear that assumption of jurisdiction by the AO is illegal and bad in law. The AO at Faridabad had not validly assumed jurisdiction to initiate reassessment proceedings against the assessee. This view is further supported by judgment of Hon'ble Gujarat High Court in the case of Hynoup Food & Oil Industries Ltd. v. ACIT(2008) 307 ITR 115 in which it is observed that AO recorded reasons for reassessment and AO issued a notice u/s 148 must be the same person. Successor AO cannot issue notice u/s 148 on the basis of reasons recorded by predecessor AO. The Hon'ble Gujarat High Court held as under: "Held, (i) that so far as the assessment years 1990-91 and 1991-92 were concerned, the officer who had issued the notice under section 148 of the Act, was different from the officer who had recorded the reasons and hence, the notices for both these years were invalid and deserved to be quashed on this ground alone." 7. In view of the above discussion, I am of the view that the assumption of jurisdiction u/s 147/148 of the Act is illegal and bad in law and, as such, liable to be quashed. I,....
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.... adduced all material particulars and primary facts fully and truly, stands satisfied. The raising of a query may only indicate that the assessing officer had inquired into the matter; but if nothing is recorded in the assessment order, that would still not show what opinion he took of the matter, and one has to only presume that he did accept the assessee's version, which is what the Full Bench has held. In my opinion, there is thus qualitatively no difference between the two types of cases. The ruling of the Full Bench of this Court would apply with equal force to both types of cases, since the assessee has furnished, fully and truly, all material ITA 2026/2010 (FB) Page 41 of 48 particulars and primary facts necessary for his assessment. The presumption under section 114(e) is applicable to both types of cases. 17. In my understanding of the judgment of the Full Bench of this court in Kelvinator (supra), the ruling is applicable to all cases where the assessment was completed under section 143(3) of the Act, subject only to the condition that the assessee has furnished fully and truly all material particulars and primary facts necessary for the assessment. It is not a q....
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....to borrow with respect the expression used by the Supreme Court in Kelvinator (supra), to come to the conclusion that there is escapement of income. The material must have a live link with the formation of the belief regarding escapement of income. When there is no failure on the part of the assessee to furnish full and true particulars and there is no tangible material on the basis of which the assessing officer can allege escapement of income, the only consequence would be that the assessing officer was exercising the power of review on the very same materials which he is presumed to have examined. This would amount to abuse of the power to re-assess and has to be checked. The solution to this problem lies in deciding ITA 2026/2010 (FB) Page 43 of 48 the question whether there was full and true disclosure by the assessee. It does not lie in pigeon-holing the ruling of the Full Bench of this court in Kelvinator (supra), affirmed by the Supreme Court, only to cases where there is overt evidence in the assessment order framed under section 143(3) to show that the assessing officer had originally formed an opinion in favour of the assessee. That, with respect, would water down the ra....
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....unt to a change of opinion not permissible in law. 20. However, the further observations of the Supreme Court in A.L.A. Firm (supra) broadly support the view taken by the Full Bench of this court. These observations are as under: - "We think there is force in the argument on behalf of the assessee that, in the face of all the details and statement placed before the Income-tax Officer at the time of the original assessment, it is difficult to take the view that the Income-tax Officer had not at all applied his mind to the question whether the surplus is taxable or not. It is true that the return was filed and the assessment was ITA 2026/2010 (FB) Page 45 of 48 completed on the same date. Nevertheless, it is opposed to normal human conduct that an officer would complete the assessment without looking at the material placed before him. It is not as if the assessment record contained a large number of documents or the case raised complicated issues rendering it probable that the Income tax Officer had missed these facts. It is a case where there is only one contention raised before the Income-tax Officer and it is, we think, impossible to hold that the Income-tax Offi....
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.... A.L.A. Firm (supra) was a case where a binding judgment of the jurisdictional High Court was overlooked when the original assessment was made, the earlier part of the observations of the Supreme Court in the aforesaid paragraph show the reluctance or disinclination of the court to accept the broad proposition, that even if full and true particulars had been furnished by the assessee at the time of the original assessment, it cannot be said that the assessing officer had applied his mind to the claims or contentions put forth by the assessee. The observation of the court that ―.....it is opposed to normal human conduct that an officer would complete the assessment without looking at the material placed before him is in substance and effect echoed in the judgment of the Full Bench of this court in Kelvinator (supra). Again the emphasis is as to whether the assessee has discharged his duty, and if so, he should not be asked to go over the grind again merely on the ground that the assessing officer has not examined the facts disclosed fully and truly and, therefore, was in no position to form an opinion 22. I find it difficult to assent to the contention of the rev....
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.... to compel us to take a divergent view. Respectfully following the observations of the Hon'ble Delhi High Court initiation of proceedings u/s 148 is not sustainable in the eye of law. Accordingly, the entire assessment fails and the entire consequent addition is liable to be deleted. We order accordingly. 9. In the result, assessee's appeal is allowed. Order pronounced in open court on 30.05.2025. ============= Document 1 Office of the Income Tax Officer, Ward- 2(2), Room No. 101-A, Aaykar Bhawan, Bhainsal Ground, Meerut e-mail- [email protected] Tel. no. 0121-2401211 F. No.ITO-W-2(2)/Meerut/2016-17/ 1333 Date: 18-08-2017 The Deputy Commissioner of Income Tax Circle, Income Tax Office Court Road, Saharanpur. Sub :- Transfer of case 'records in the scrutiny case of Smt. Reeta Rana, r/o 44, Mission Compound, Saharanpur (PAN: ADMPR6627F) F.Y. 2009-10 relevant to the A.Y. 2010-11, time barring on 31-12-2017 - Reg Kindly refer to the above mentioned subject In this connection, it is to inform you that on the basis of AIR information, notice u/s 148 w.es wind to the above mentioned assessee after taking necessary approval of higher author....