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2005 (12) TMI 240 - ITAT LUCKNOW-AIncome Escaping Assessment - assessment order passed u/s 147/143(3) - initiation of proceedings by issue of notice u/s 148 - Validity Of order passed u/s 263 - denial of authorship of the documents pertaining to VDIS - addition on account of unexplained money - HELD THAT:- We may point out that addition under section 69A can be made only when it is found that the assessee is owner of any money, bullion, jewellery, etc. or other valuable article, etc.; in the financial year relevant to the assessment year in which addition on account of unexplained money etc. is made. In our considered opinion, the material on the basis of which reopening has been made for assessment year 1998-99 cannot at all justify the reopening of assessment as there was no basis for doing so. On the basis of documents on which reopening has been made, it cannot be said that any income for assessment year 1998-99 escaped assessment because on the basis of such material, prima facie, it cannot be believed nor could there be any reason to believe that income for this assessment year has escaped assessment. The department has no other material in its possession for having reason to believe that income pertaining to assessment year 1998-99 had escaped assessment. Thus, we are of the considered opinion that action taken u/s 148/147 was wholly illegal because there was no basis for reopening of assessment as has been done in this case. The order was, therefore, without any jurisdiction and thus void. Since the assessment order passed u/s 147/143(3) was itself illegal and void, ld. CIT(A) was having no justification to invoke jurisdiction u/s 263 against such void or now est order. We hold that as the order of the Assessing Officer passed u/s 147/143(3) was itself void, the order of CIT passed u/s 263 for quashing this order was without jurisdiction. Hence, the same is liable to be quashed. We, therefore, quash the order of the ld. CIT passed u/s 263. Thus, we quash the impugned order of ld. CIT passed u/s 263. In our opinion, there is no material before the ld. CIT to record a prima facie finding that the assessee was owner of money, bullion, etc. in the previous year relevant to assessment year 1998-99. No such finding can be recorded on the basis of the material which came to the possession of the revenue and besides this material there was no other material collected by it to hold that the assessee was owner of any money, bullion, etc. in the previous year relevant to assessment year 1998-99 in the terms and conditions contained under section 69A of Income-tax Act. In this regard, reference can be made to the decision of Patel Cotton Co. Ltd. v. Asstt. CIT [1997 (5) TMI 430 - ITAT MUMBAI] which fully support our findings. Thus, we are of the considered opinion that the ld. CIT was not justified in holding that the order of the Assessing Officer was erroneous or prejudicial to the interest of revenue. On this ground also, the order of ld. CIT(A) is liable to be quashed. In the result, the appeal of the assessee is allowed and is disposed of as above.
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