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2019 (12) TMI 880 - AT - Income TaxRe-assessment proceedings initiated u/s 147/148 - HELD THAT:- If the recorded reasons shout contradiction and inconsistency it means necessary satisfaction in terms of the statutory provision has not been recorded at all. AO was not competent to continue with the proceeding under section 147 on some other issues or grounds which were not mentioned in the reasons recorded under section 148(2). A plain reading of Explanation (3) to Sec. 147 shows that for the purpose of reassessment u/s 147 the AO can reassess income in receipt of an issue which escaped assessments and such other income which comes to his notice subsequently in the course of proceedings under the said section even though the reasons for such issue/income were not included in the recorded reasons. The explanation (3) however pre-supposes that the issue with reference to which the reason was recorded, was found to be legally & judicially tenable and with reference thereto the AO is able to prove that income had indeed escaped assessment. It is only when the AO is able to establish valid initiation of reassessment proceedings with reference to the recorded reasons and in the reassessment u/s 147; such income is also assessed; only then the AO will be able to be expand the scope of reassessment proceedings by assessing any other escaped income which comes to his notice in the course of reassessment. If on the other hand, the AO is not able to justify the reopening of a concluded assessment with reference to reasons recorded u/s148(2) or where on examination of assessee's submissions AO agrees that on the basis of reasons recorded it cannot be held that income had escaped assessment within the meaning of Sec. 147 then in such an event the very reopening of a concluded assessment stands vitiated and therefore the AO cannot expand the scope of reassessment by including some more issues or reasons which did not find mention in the reasons recorded u/s148(2). For that we rely on the judgment of the Hon`ble Bombay High Court in the case of CIT Vs Jet Airways India Ltd [2010 (4) TMI 431 - HIGH COURT OF BOMBAY] In view of the facts narrated above and the binding precedents applicable to the facts, we are of the view that the reasons recorded are bad in law therefore we quash the reassessment order passed by AO under section 147/148 - Decided in favour of assessee.
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