Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (4) TMI 1114 - AT - Income TaxBest Judgement Assessment u/s 144 - Validity of AO’s jurisdiction u/s. 144 - failure on the part of the assessee to file return of income u/s. 139 or not? - HELD THAT:- Out of three preconditions for invoking the provisions of section 144, in the present case, none of these three conditions is existing because the assessee has filed the return of income as well as complied with the notice issued by the AO u/s. 142(1) - the only requirement of notice issued by the AO u/s. 142(1) on 13.01.2017 was this that assessee should attend along with the books of accounts on 24.01.2017 and this is not the case of the AO that the assessee has not appeared before him along with the books of accounts. In our considered opinion, in the facts of present case as discussed above, this judgment of MOHINI DEBI MALPANI [1969 (1) TMI 22 - CALCUTTA HIGH COURT] is squarely applicable in which it was held that if the conditions precedent for the assumption of jurisdiction under Section 144 of the Act are not present, the order of assessment u/s. 144 must be struck down as being without jurisdiction. Thus the conditions precedent for the assumption of jurisdiction u/s. 144 were not present and therefore, the assessment order passed by the AO u/s. 144 of IT Act deserves to be struck down and we struck down the same in all these four years. Validity of reopening of assessment - combined reasons recorded for several years - HELD THAT:- issue of combined notice u/s 148 for several years to the assessee cannot be equated with recording of combined reasons 148 for several years because, in reply to notice u/s 148, the assessee is required to make compliance within a prescribed time by filing return of income but by recording of reasons for reassessment, the action is to be taken by the AO only by issuing notice u/s 148 and no action is to be taken by the assessee at this stage. Once the notice is issued by the AO u/s 148 and the return is filed by the assessee, the assessee may obtain the copy of reasons recorded by the AO and thereafter, the assessee may raise objection against the reopening. At that stage, if the reasons for several years are identical and therefore recorded together, it has no impact on the action to be taken by the assessee and hence, in our considered opinion, this judgment cannot be stretched to hold that recording of combined reasons for more than one year renders the reassessment bad in law. This objection has no merit. No live link or nexus between information/material and formation of belief - HELD THAT:- There is no specific mention of name of the assessee in any statement as noted by the AO himself in the order passed by him to dispose of the objections of the assessee, in our considered opinion, the facts noted by the AO in the reasons recorded by him can be reasons to have suspicion about the genuineness of these transactions but on the basis of these facts, a man of ordinary prudence will not have reasons to believe that income has escaped assessment because the live link between the material available with the AO and formation of belief is missing particularly when there is no mention of the material found in course of survey, if any and considering this admitted fact that it is observed by the AO himself in Para 2 on page 173 of the order passed by him to dispose of the objections of the assessee that there is no specific mention of name of the assessee in any statement. In the light of above discussion, in our considered opinion, this judgment of Hon’ble apex court rendered in the case of ITO vs. Lakhmani Mewal Das [1976 (3) TMI 1 - SUPREME COURT] is applicable in the present case and respectfully following the same, we hold the reopening is not valid in the facts of the present case. - Decided in favour of assessee. In view of our decision in favour of the assessee on both these technical aspects i.e. validity of the assessment order u/s 144 and validity of reopening of the assessment, we feel that decision on merit is not called for because it is of academic interest only. Hence, we do not decide the issue on merit.
|