TaxTMI 
TaxTMI 
TaxTMI 
2025 (3) TMI 1552
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....ciding the issue related to validity of assessment. 3. Ld. Commissioner of Income tax (Appeals), National Faceless Appeal Centre has erred in law and facts in holding the view that no reasons are assigned for not submitting the evidences before assessing officer. 4. Ld. Commissioner of Income tax (Appeals), National Faceless Appeal Centre has erred in law and facts in denying the request for admission of new evidences in terms of Rule 46A of the I.T. Rules, 1962. 5. Ld. Commissioner of Income tax (Appeals), National Faceless Appeal Centre has erred in law and facts in holding the view that the lapse on part of tax consultant for performance of his duties cannot be a base for relief. 6. Ld. Commissioner of Income tax (Appeals), National Faceless Appeal Centre has erred in law and facts in not appreciating merits of explanation for source of cash deposits in joint savings accounts. 3. At the outset, Learned Counsel for the assessee, informs the Bench that assessee does not wish to press ground Nos. 3 to 6, raised by the her, therefore, we dismiss ground Nos. 3 to 6 raised by the assessee. 4. Now the effective ground of appeals, are ground Nos. 1 and 2, in which, t....
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....e and also did not mention the amount escaped from assessment. Therefore, it is a complete non-application of mind, on the part of the assessing officer and therefore, reasons were recorded in a mechanical manner, hence, reassessment proceedings may be quashed. 9. On the other hand, Learned Senior Departmental Representative (Ld. Sr. DR) for the Revenue submitted that reasons recorded by the assessing officer are perfect reasons and these reasons are as per law and there is only a typographical error in the reasons recorded, which does not mean that the reasons are vitiated, therefore reassessment proceedings cannot be quashed merely because there is a typographical error in not mentioning the bank account number in the reasons recorded by the assessing officer. The Ld. DR for the Revenue, also submitted written submission before the Bench, which we have gone through. The ld. DR has also primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 10. We have gone through the facts of the case, the reasons recorded for reopening u/s 147 of the Act, the submission and the various d....
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....he Principal Commissioner of Income-tax-3, Rajkot as per the provisions of Section 151 of the Act." 11. Having gone through the above reasons recorded, by the assessing officer, we find the following, inconsistency and irregularities in the reasons recorded by the assessing officer: (i) The above reasons recorded by the assessing officer does not mention the bank account number, which was escaped assessment. (ii) The nature of transactions have not been mentioned, in the reasons recorded. (iii) There is non-application of mind of the assessing officer. The assessing officer has not verified the bank account number before issuing notice u/s 148 of the Act. (iv) Mere deposit in the bank account does not constitute that income escaped assessment, the money in the bank account may be deposited out of the past savings / by sale of investment etc, which was not verified by assessing officer and hence there is complete non-application of mind. 12. The Ld. AO had not applied his mind and acted on mere information basis. The Ld. AO even failed to prove direct nexus with the information and reason recorded for reopening. The above reasons recorded by the assessing officer does not....
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....assessment even if the information is wholly vague, indefinite, far-fetched and remote. The reason for the formation of the belief must be held in good faith and should not be a mere presence. The powers of the Income-tax Officer to reopen assessment, though wide, are not plenary. The words of the statute are "reason to believe" and not "reason to suspect". The reopening of the assessment after the lapse of many years is a serious matter. The Act, no doubt, contemplates the reopening of the assessment if grounds exist for believing that income of the assessee has escaped assessment. The underlying reason for that is that instances of concealed income or other income escaping assessment in a large number of cases come to the notice of the income-tax authorities after the assessment has been completed." 15. The purpose behind the relevant provisions imposing condition precedent for initiating reassessment proceedings is to ensure finality of proceedings. The Act also provides that such reason must be recorded in writing before issue of notice of reassessment so as to judge the existence of such belief before initiating reassessment proceedings by issue of notice u/s 148 of the Act.....