TMI Blog2023 (2) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... rent view is being taken. The case of Phool Chand Bajrang Lal [ 1993 (7) TMI 1 - SUPREME COURT] relied upon by Mr. Kumar can be differentiated on the facts, in as much as the managing director of the Calcutta company Mr. Surana had made a confession about his business activity being that of a name lender and had not advanced any loan to the assessee in that case. As in the present case there is a full and true disclosure by the petitioner, which transaction has been accepted under the head claimed by the petitioner. Consequently, merely because another director of the same company had disclosed the income received differently, cannot be a ground for reopening and the same is evidently a change of opinion not only based on conjectures and surmises but also a case of blindly relying on information and borrowed satisfaction which is not permitted for reopening - It is an imperative duty of the authorities to be updated with the law and to apply it to the case at hand before taking decisions and passing orders. Decided in favour of assessee. - WRIT PETITION NO. 8010 OF 2022 - - - Dated:- 15-2-2023 - DHIRAJ SINGH THAKUR AND KAMAL KHATA, JJ. For the Petitioner : Mr. Mihir Na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of appellate proceedings in the case of Milan Saini for A.Y 2014-15 that Shri Deepak Marda and Shri Milan Saini were Directors in them/s Cinepolis India Pvt. Ltd. It was further seen that both Shri Deepak Marda and Shri Milan Saini received amount of ₹33,55,12,980/- each during the year under a settlement agreement. IN the case of Shri Milan Saini the appeal has since been decided by the CIT(A) Gurgaon the amount of ₹ 33,55,12,980/- received by Shri Milan Saini has been held to be taxable under the head Income from Salary. Thus amount of ₹ 33,55,12,980/- for A.Y. 2014-15 received by Shri Deepak Marda, the assessee is required to be tax under the head income from Salary. 3. Analysis of information collected/received :- The information received has been analysed. On verification of the information, it is found that during the course of appellate proceedings in the case of Milan Saini for A.Y. 2014-15 that Shri Deepak Marda and Shri Milan Saini were Directors in them/s Cinepolis India Pvt. Ltd. It was further seen that both Shri Deepak Marda and Shri Milan Saini received amount of ₹33,55,12,980/- each during the year under a settlement agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome which may come to the notice during the assessment proceedings u/s 147 of the IT Act,1961. 4. By letters dated 7th April 2021, 10th April 2021 and 6th May 2021 the petitioner filed his objections inter alia on the ground that the impugned notice was issued on borrowed satisfaction of another AO was issued beyond period of four years from the completion of the regular assessment without demonstrating any failure on the part of the petitioner to disclose any material facts truly and fully. On 21st April 2021 and 22nd April 2021, the respondent no.1 disposed of the objections of the petitioner stating that the assessee is required to be taxed under the head income from salary and should have disclosed the income under the head income from salary. With regard to the objection based on sanction for issuance of the impugned notice in terms of Section 149(1)(b) and Section 151 of the IT Act, the order stated that section 151 (1) was applicable and necessary approval of the PCIT had been taken online. The order however, failed to demonstrate any failure on the part of the petitioner to disclose material facts. 5. On 3rd May 2021, the PAN of the petitioner was unilaterally trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the reasons recorded. On the contrary, the Assessment Order dated 8th December 2016 u/s 143 (3) of the Act explicitly mentions the acceptance of the total income disclosed by the petitioner in the return after due verification and examination of the information furnished. He submitted that the reopening was initiated solely on the basis of information received from the ACIT, Gurgaon without application of mind. He submitted that no new material is mentioned in the notice apart from the purported information from the ACIT, Gurgaon. He accordingly prayed that the petition be made absolute. 7. Mr. Kumar learned counsel for the respondents raised a preliminary objection submitted that the petitioner should have made the concerned AO i.e. ITO Wd.I (4), Gurugram a party to this petition since the JAO Gurugram has passed an order dated 10 June 2022 instead of ITO Ward.1 Ichalkaranji. He submitted that the expression reason to believe cannot be read to mean that the AO should have finally ascertained the fact by evidence or conclusion. At the stage of issue of notice, the only question was with the relevant material a reasonable person could have formed a requisite belief of escap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19] 104 taxmann.com 216/ [2019] 263 Taxman 594 (Bombay) this court held: It is settled position in law that re-opening of an assessment has to be done by an AO on his own satisfaction. It is not open to an AO to issue a reopening notice at the dictate and/or satisfaction of some other authority. Therefore, on receipt of any information which suggests escapement of income, the AO must examine the information in the context of the facts of the case and only on satisfaction leading to a reasonable belief that income chargeable to tax has escaped assessment, that reopening notice is to be issue. 10. In the present case, the AO has not specifically mentioned in the order, what was the tangible material, to conclude that there was an escapement of income. The AO has also failed to aver what material fact the assessee has failed to disclose fully and truly. It is evident that based on the case of Milan Saini who had disclosed his income under the head income from salary that the AO sought to reopen the case of the assessee. Apart from different heads on which the assessees have offered their income to be taxed i.e. there is no other ground based on which the AO is seeking ..... X X X X Extracts X X X X X X X X Extracts X X X X
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