TMI Blog2011 (2) TMI 760X X X X Extracts X X X X X X X X Extracts X X X X ..... as been brought on record to suggest the escapement of income except the Inspector's report which cannot be basis for information of belief. - Decided in favor of the assessee. - ITA NO. 157 (Jodh.) OF 2009 - - - Dated:- 11-2-2011 - SHRI S.V. MEHROTRA, AND SHRI V.D. RAO, JJ. Represented by: Amit Nigam for the Appellant. N.R. Mertia for the Respondent. S.V. Mehrotra, Accountant Member This appeal by the Revenue arises out of the order dt. 28th Jan., 2009 of learned CIT(A), Bikaner for the asst. yr. 2005-06. 2. On the basis of AIR Txn. Code 006 information received from the Sub-Registrar, Bikaner that the assessee purchased land valuing at Rs. 30,00,000 or more, the AO issued letter to the assessee to furnish the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been disposed of, which was against the decision of Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. v. ITO [2003] 259 ITR 19. The AO reiterated that the assessment proceedings were initiated on account of unexplained investment under section 69C in purchase of land. The assessee again raised objections and pointed out that the proceedings under section 147 could not be taken on the basis of value taken by the Sub-Registrar and also the proceedings under section 147 cannot be taken on mere humour and surmises. The assessee had relied upon various decisions in this regard. It was further submitted that no action can be initiated on the valuation report made by the Departmental authorities. Finally, after considering all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in which the Inspector has only stated that though the assessee purchased the property @ Rs. 250 per sq. ft. but in that area, the rate was from Rs. 500 to 600 per sq. ft. No details or any instances have been given in the said report. In any case this report could not be the basis for information of belief of the AO regarding escapement of income. There has to be nexus between formation of belief and escapement of income. In the present case, only valuation done by the stamp valuation authority and the Inspector's report have been taken as basis for formation of belief. The Madhya Pradesh High Court in the case of CIT v. D.N. Pachori has held that Inspector's report cannot be the basis for formation of belief regarding escapement of inco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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