TaxTMI 
TaxTMI 
2000 (8) TMI 261
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....possessed formidable information suggesting that necessary particulars pertaining to his income were not disclosed by the assessee and thereby substantial income chargeable to tax had escaped assessment." The learned Departmental Representative of Revenue has regarding asst. yr. 1983-84 (ITA No. 1022 (Jp) of 1993) contended that the AO got information from anti-corruption department and on that basis he formed his belief that taxable income has escaped assessment. He has contended that the learned Dy. CIT(A) has observed in his impugned order that the facts were already disclosed, but it is not known as to before whom the same were disclosed. He has known as to before whom the same were disclosed. He has referred to para 4 on p. 2 of Dy. CIT(A)'s order and. contended that the learned Dy. CIT(A) could, in the circumstances, have set aside the assessment orders and restored the matter to AO. He has contended that the Dy. CIT(A) has not examined quantum and has straightaway cancelled the assessments. He has contended that sufficiency/adequacy of reasons cannot be adjudged by Dy. CIT(A). 5. Regarding asst. yrs. 1984-85 to 1986-87 and 1988-89 he has further contended that on issuance ....
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....lots was not mentioned. He has contended that this is a material fact under s. 147. He has contended that the information given on p. 4 of P.B. doe not give sufficient particulars. He has contended that in these cases, by figures of subsequent assessments, it is proved that there had been escapement of income. He has contended that in asst. yr. 1983-84, it is only after receipt of information from ACD that the notice under s. 148 was given. 9. We have considered the rival contentions as also the materials on record. 10. First we take up asst. yr. 1983-84. For this assessment year return of income was not filed and the income as shown in annexures of asst. yr. 1984-85 was at Rs. 14,520, that is below taxable limit. The assessee's assessed income under s. 147, is however Rs. 56,210. Obviously there has been an escapement of income. As the assessee had not filed the return (for asst. yr. 1983-84) and the Department had received the information from ACD that the assessee had purchased a number of plots and had made huge investments in construction, which was general though, but coupled with the subsequent factum/quantum of assessed income may, in the peculiar fact-situation of this c....
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....------- 1984-85 5,500 (18,000- Estimate 12,000 12,000 Non- 5,500) (C.C.) acceptance- =12,500 of C.C. --------------------------------------------------------------------- 1985-86 6,500 (20,000- " 25,000 25,000 " 6,500) (C.C.) =13,500 --------------------------------------------------------------------- 1986-87 8,800 (34,000- " 20,000 20,000 " 8,800) (C.C.) =25,200 --------------------------------------------------------------------- 1988-89 13,300 (35,000- " 14,000 14,000 " 13,300 (C.C.) =21,700 --------------------------------------------------------------------- Others --------------------------------------------------------------------- Nature of addition Declared in Amount Basis of addition Return added --------------------------------------------------------------------- 1984-85 - - - - 1985-86 - - - - 1986-87 - - - - 1988-89 (i) Registration - 4,000 Estimate expenditure of plot purchased (ii) Difference/excess - 6,620 Excess of of expenditure (bank Expenditure deposit + household estimated over expenses) over earned earned income income shown (iii) Accrued interest - 8,955 Deduction disallowed ---------------------------....
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....ion "reason to believe" in this regard, does not mean merely reason to suspect but something more than that. The expression, in its true legislative spirit, would imply existence of such facts/material on record as would reasonably lead a rational person, or a person of reasonable/ordinary prudence to entertain honestly and in good faith, a belief, prima facie though, and not a finding as such, conclusive or otherwise, at that stage, that some income chargeable to tax, has escaped assessment. Thus, the belief, contextual here, is linked with and is dependent upon some material on record to form rationally the basis or the reason for the same and not a mere fancy/imagination or a differing opinion. It may well be observed here that where the information to constitute "reasons of belief" of escapement of taxable income, is only general and non-specific, the same may, in certain circumstances, be examined in the context of ensuring assessments as well as the same may facilitate to analyse the gravity/substantially of the initial indicativeness, tethered in the generality of information, spread over therein. Though the belief is normally formed, undisputedly, on taking a circumspect vi....