2011 (11) TMI 51 - DELHI HIGH COURT

Deemed income - validity of Income escaping assessment - Information from external source - Held that:- In the assessment year 1999-2000, no information or material in the form of facts was furnished from any external source. The facts were already on record furnished by the letter dated 8th February, 2002. In the subsequent year i.e. assessment year 2001-02, an addition under Section 2(22)(e) of the Act, was made but was partly deleted by the CIT (Appeals) on the ground that loans and advances pertaining to other years with the observation that the assessing officer was entitled to take remedial action as per law in the relevant years. This is not factual information or material which can be covered by the Explanation (1). The facts were already known and on record and were not brought to the notice of the department by virtue of the order passed by the CIT (Appeals) in the assessment year 2001-02 - Decided in favor of assessee in respect of AY 1999-00.

Income escaping assessment in respect of AY 2000-01 - Held that:- As far as assessment year 2000-01 is concerned, the return was not taken up for scrutiny and no order under Section 143(3) of the Act was passed. Therefore, the contention that there was change of opinion cannot be accepted. - order passed by the CIT (Appeals) in the assessment year 2001-02 would constitute information or material from any external source and the decision of the Supreme Court in Phool Chand Bajrang Lal’s case (1993 -TMI - 5423 - SUPREME Court) would be applicable and supports the stand of the Revenue. - Decided in favor of revenue.