TMI Blog2015 (10) TMI 313X X X X Extracts X X X X X X X X Extracts X X X X ..... sment. Therefore, it is obligatory on the part of the Assessing Officer to record his reason which made him to believe that the income chargeable to tax has escaped assessment for any assessment year. In this case, the Assessing Officer reopened the assessment by issuing notice under Section 148 of the Act to verify whether the borrowal was for business purpose and whether the assessee claimed excess deduction. The Assessing Officer has not formed any opinion that the assessee claimed excess deduction thereby the income otherwise chargeable to tax escaped assessment. This Tribunal is of the considered opinion that to verify or to consider whether the assessee claimed excess deduction or borrowed loan for business purpose, the concluded asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee received interest from Karnataka Bank and Indian Bank. The assessee has also received interest from Heeral Constructions Pvt. Ltd., Haresh Chand, Shyam G. Duseja, Gee Gee Hire Purchase and Leasing P. Ltd. and S n S Exports India Ltd. According to the Ld. D.R., other than Karnataka Bank and Indian Bank, all other parties are related to the assessee and the assessee is also Director in the companies. Referring to the assessment order, the Ld. D.R. pointed out that the claim of the assessee that he was carrying on money lending business was not substantiated before the Assessing Officer. The Assessing Officer found that the money lending business was not carried on regular intervals. The assessee has not carried out the regular interest a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ross4 objections ought to have filed on or before 26.02.2004. However, in fact, there was a delay of 1389 days in filing the cross-objections. 4. The Ld.counsel for the assessee further submitted that this Tribunal, by an order dated 11.05.2007, allowed the appeals of the Revenue. After that, the assessee changed his representative and engaged the present counsel. According to the Ld. counsel, the earlier representative for the assessee M/s B.P. Jain Co. failed to take action by filing cross-objections. Therefore, after the appeals were restored on file by recalling the earlier order, the assessee filed the cross-objections. Hence, the delay may be condoned and the cross-objections may be taken on file. 5. By way of rejoinder, Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment, the Ld.counsel for the assessee submitted that the Assessing Officer reopened the assessment to verify whether the borrowal was for the business purpose. In this case, no disallowance was made by the Assessing Officer and the Assessing Officer treated the interest income as income from other source . However, the CIT(Appeals) allowed the claim of the assessee by assessing the same under the head business . It is not the case of the Revenue, according to the Ld. counsel for the assessee, that the assessee has claimed excess deduction. Just to verify whether the borrowal was for business purpose and there was any excess deduction, the assessment cannot be reopened. Referring to Section 147 of the Act, the Ld.counsel submitte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ole borrowal was for business purpose and to consider whether the assessee claimed any excess deduction, the Assessing Officer reopened the assessment. 10. I have carefully gone through the provisions of Section 147 of the Act. Section 147 clearly says that if the Assessing Officer has reason to believe that the income chargeable to tax has escaped assessment for any assessment year, he may issue notice under Section 148 of the Act to assess or reassess such income. Explanation 2(b) to Section 147 of the Act clearly says that understating of income or claiming excess loss, deduction, allowance or relief in the return is also deemed to be escapement of income. What is necessary is that the Assessing Officer has reason to believe that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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