TMI Blog2011 (11) TMI 653X X X X Extracts X X X X X X X X Extracts X X X X ..... ds as follows:- On the facts and in the circumstances of the case, the ld. CIT (Appeals) has erred in deleting an addition of ₹ 77,00,000/- ignoring the fact that the assessee has not declared any capital / loss on the sale transaction stated to be the sale of investment. 3. The grounds of appeal raised by the assessee in the cross objection read as follows:- 1. Ld. CIT (Appeals) is not justified in law and facts and circumstances of the case in confirming the action of assessing officer in initiation of proceedings under section 147 of the I. T. Act, in view of proviso of section 147 of the I. T. Act under the circumstances when original assessment was completed under section 143(3) of the I. T. Act and proceedings und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asons recorded the assessing officer had not recorded satisfaction as required by proviso to section 147 read with section 148(2) that the income chargeable to tax had escaped assessment on account of failure on the part of the assessee to disclosed fully and truly all material facts necessary for his assessment. Therefore, the condition precedent necessary for invoking jurisdiction under section 147 was missing and the issuance of notice was wholly without jurisdiction. The assessee placed reliance on several decisions. The assessing officer, however, rejected the contention of the assessee on the ground that prima facie it was a case of escapement of income. 5. On appeal it was submitted that there was no whisper of a word in the reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accommodation entries. These facts came to the notice of the assessing officer after completing the assessment under section 143(3) of the Act for the first time. The ld. CIT (Appeals), therefore, upheld the reopening of assessment. 6.1 Before us the ld. AR of the assessee submitted that original assessment under section 143(3) of the Act was made on 22/12/2004. Notice under section 148 was served on the assessee on 30th July, 2007. Therefore, the notice under section 148 was served on the assessee after expiry of four years. Hence assessee s case falls under proviso to section 147 of the Act. For initiation of proceedings under proviso to section 147, the assessing officer in the reasons should have recorded that there was failure on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first assessable. Therefore, the assessee s case is covered by proviso to section 147 of the Act. In the reasons recorded by the assessing officer on the basis of specific information received from DIT [Investigation], New Delhi, there is no whisper of a word that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment. Hon ble Delhi High Court in the case of Wel Inter Trade P. Ltd. Another Vs. ITO (supra) has held that where provisions of section 147 are being invoked after the expiry of four years from the end of the relevant assessment year, the assessing officer in addition to having reason to believe that any income chargeable to tax has escaped assessment, must also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Haryana High Court and held that in the absence of any such allegation that escapement of income occurred by reason or failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment, the invocation of section 147 and issuance of notice under section 148 and subsequent completion of assessment was without jurisdiction. 8. In the case of Haryana Acrylic Manufacturing Company Vs. CIT (supra) the reasons recorded did not indicate the failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment for assessment year 1998-99. While in the reasons supplied to the petitioner there was no mention of allegation that there was a failure on the part of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tisfaction in the reasons recorded that there was failure on the part of the assessee to disclose all material facts necessary for assessment. Though decision of Hon ble Delhi High Court in the case of AGR Investments Ltd. Vs. Addl. CIT (supra) has been rendered in 2011 and decisions in Wel Inter Trade P. Ltd. Another Vs. ITO (supra) Haryana Acrylic Manufacturing Company Vs. CIT (supra) in 2008 but the issue relating to failure on the part of the assessee to disclose all material facts necessary for his assessment was not deliberated. Therefore, the decision of Hon ble Delhi High Court in the case of AGR Investments Ltd. (supra) is distinguishable on facts. 10.1 In the case before us in the reasons the assessing officer has not recor ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
