TMI Blog2012 (3) TMI 266X X X X Extracts X X X X X X X X Extracts X X X X ..... granted by CIT. There is no statutory provision here under which a power to be exercised by an officer can be exercised by a superior officer. When the statute mandates the satisfaction of a particular functionary for the exercise of a power, the satisfaction must be of that authority. Therefore in view of non-compliance of the mandatory requirements of Section 147 and 151(2), the notice reopening the assessment cannot be sustained in law - Decided in favor of assessee. - WRIT PETITION NO.1246 OF 2012 - - - Dated:- 12-3-2012 - DR.D.Y.CHANDRACHUD M.S. SANKLECHA. JJ. Mr. J.D. Mistri, Sr. Advocate with Mr. Madhur Agarwal and Mr. Atul K. Jasani for the Petitioner. Mr. Suresh Kumar for the Respondent. ORAL JUDGMENT : ( Per Dr. D.Y. Chandrachud, J.) Rule; with the consent of learned Counsel for the parties returnable forthwith. With the consent of Counsel and at their request the Petition is taken up for hearing and final disposal. 2 In this proceeding under Article 226 of the Constitution, the petitioner has questioned the legality of a notice issued on 30 March 2011 under Section 148 of the Income Tax Act, 1961 proposing to reopen an assessment for Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by availing of a visitor's visa. On this count, the Assessing Officer held that the Assessee had received an amount of Pound Sterling 6,50,000/on account of professional services rendered in India, the value of which as on 31 March 2003 was Rs.4.9 crores. The Assessee had contended that the amount was not liable to tax in Assessment Year 200304 since it was received in the succeeding financial year. The Assessing Officer held that as a matter of fact the amounts were deposited in the bank account of the assessee outside in India in the financial year 200304 but the Assessee had intentionally received the amount in a foreign country in the next financial year to evade the payment of tax. Hence, the entire receipt corresponding to Pound Sterling 6,50,000 was taxed for Assessment Year 200304. The Assessee filed his return of income for Assessment Year 200405 on 2 September 2004. An intimation was issued under Section 143(1). On 30 March 2011, a notice was issued under Section 148 purporting to reopen the assessment for Assessment Year 200405. The reasons which have been disclosed to the Assessee in reopening the assessment are as follows: ASN 4 WP-1246.sxw A letter being No.KYN/Addl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ought to be taxed as income having escaped assessment for Assessment Year 200405 which is the next Assessment Year. According to the Assessee, exfacie, this will indicate that the Assessing Officer could not have any reason to believe that there was escapement of income for Assessment Year 200405, since even according to the Revenue, income which has been received in Assessment Year 200304 has escaped assessment; ii) There is no tangible material on record on the basis of which the assessment can be reopened beyond a period of four years of the end of the relevant Assessment Year. The letter of the Additional DIT dated 11 March 2010 was available when the order of assessment for Assessment Year 200304 was passed, over 9 months thereafter on 27 December 2010. The order of assessment brought an additional amount of Rs.4.9 crores to tax for Assessment Year 200304. Hence, there is absolutely no fresh or tangible material on the basis of which the assessment is sought to be reopened for Assessment Year 200405; iii) The DCIT issued a notice for reopening on 30 March 2011 when as a matter of fact approval was received with reference to the provisions of Section151 from the Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer noted that though the amount had been received by the Assessee in his bank account during financial year 200304 (which would correspond to Assessment Year 200405) the assessee had intentionally received that amount in the next year to evade the payment of tax. The receipt of Rs.4.9 crores was hence brought to tax for Assessment Year 200304. The reasons on the basis of which the assessment for Assessment Year 200405 is now sought to be reopened are founded on a letter dated 11 March 2010 received from the Additional Director of Income Tax (Investigation). A gist of the letter is contained in the first paragraph of the reasons disclosed to the Assessee. A copy of the letter has been handed over to the Court during the course of hearing by learned Counsel for the Revenue. In the letter dated 11 March 2010, the Additional DIT (Investigation) addressed the following communication to the Additional CIT, Range I, Thane: 1 Kindly find enclosed herewith tax evasion petition dated 15 February 2010 categorised as X in the case of Ghanshyam Khushaldas Kharbani residing at C/o Dyal K. Khabrani, 5th floor, Ghanshyam Nagar, Thane (E) having PAN AAKPK4580D. The TEP is being for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e challenged is that the mandatory requirement of Section 151(2) has not been fulfilled. Section 151 requires a sanction to be taken for the issuance of a notice under Section 148 in certain cases. In the present case, an assessment had not been made under Section 143(3) or Section 147 for A.Y. 200405. Hence, under sub section 2 of Section 151,no notice can be issued under Section 148 by an Assessing officer who is below the rank of Joint Commissioner after the expiry of 4 years from the end of the relevant Assessment Year unless the Joint Commissioner is satisfied, on the reasons recorded by such Assessing Officer, that it is a fit case for the issue of such notice. The expression Joint Commissioner is defined in Section 2(28C) to mean a person appointed to be a Joint Commissioner of Income Tax or an Additional Commissioner of Income Tax under Section 117(1). In the present case, the record before the Court indicate that the Assessing Officer submitted a proposal on 28 March 2011 to the CIT(1) Thane through the Additional Commissioner of Income Tax Range (I) Thane. On 28 March 2011, the Additional CIT forwarded the proposal to the CIT and after recording a gist of the communic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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