TMI Blog2015 (2) TMI 1141X X X X Extracts X X X X X X X X Extracts X X X X ..... understanding whether the amount was an addition to the income returned or disallowance of the expenditure claimed, the Ld. CIT(A) confirms the 'disallowance' made by the AO. This shows not only the non-application of mind by the CIT(A), but also total ignorance of facts and law on the matter under consideration. In our opinion it is the CIT(A) who took hyper technical view and not assessee. The re-assessment order of AO and impugned order of CIT(A) are set aside - Decided in favour of assessee - ITA No. 448/Hyd/2015 - - - Dated:- 17-2-2015 - P. Madhavi Devi, JM And B. Ramakotaiah, AM For the Appellant : Shri S Rama Rao, AR For the Respondent : Shri B Kurmi Naidu, DR ORDER Per B Ramakotaiah, AM The issue in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment was completed based on the information from CIT-CIB, Hyderabad and after verification of the material produced, the income returned was accepted. This assessment was completed by Dy. CIT, Circle-I, Karimnagar. 2.1. The AO, subsequently based on the same information, has reopened the assessment and issued notice u/s. 148 dt 14-12-2011. This reopening is after four years from the end of the relevant assessment year. In the reassessment proceedings, the submission dt. 22-10-2007 was reproduced in para 3 of the order. AO recorded a statement from Mr. K. Rajender Rao on 14-03-2013 and came to the conclusion that the transactions pertaining to Mr. K. Rajender Rao cannot be accepted. Even though AO acknowledges that the amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Ld. Counsel relied on various case law. 4. Ld. DR however, supported the orders of the authorities. 5. We have perused the rival contentions and evidence placed on record. There is no dispute with reference to the fact that the then AO (DCIT, Circle-1, Karimnagar) did enquire about the deposits in the bank a/c and assessee has justified not only by giving an explanation but also furnishing an affidavit from Shri K. Rajender Rao along with the copies of the bank accounts of the firm to justify the transactions in the bank account. Having satisfied about the same, the AO completed the assessment without making any addition of the same. Since the assessment was reopened after the end of the four year period, it is imperative that AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecided in favour of the assessee. Reassessment proceedings in the said cases will be hit by the principle of change of opinion ; and (iii) reassessment proceedings will be invalid in case an issue or query is raised and answered by the assessee in original assessment proceedings but thereafter the Assessing Officer does not make any addition in the assessment order. In such situations, it should be accepted that the issue was examined but the Assessing Officer did not find any ground or reason to make addition or reject the stand of the assessee. He forms an opinion. The reassessment will be invalid because the Assessing Officer had formed an opinion in the original assessment, whether or not he had recorded his reasons in the assessment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings under section 147 of the Act. The said submission is fallacious. An order of assessment can be passed either in terms of sub-section (1) of section 143 or sub-section (3) of section 143. When a regular order of assessment is passed in terms of the said sub-section (3) of section 143 a presumption can be raised that such an order has been passed on application of mind. It is well known that a presumption can also be raised to the effect that in terms of clause (e) of section 114 of the Indian Evidence Act judicial and official acts have been regularly performed. If it be held that an order which has been passed purportedly without application of mind would itself confer jurisdiction upon the Assessing Officer to reopen the procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is neither any discussion about the submissions made by assessee nor about the satisfaction recorded by the AO nor about the objections raised by assessee in the re-assessment proceedings on jurisdiction. In fact, Ld. CIT(A) did not even comment about the veracity of reopening of the assessment. As seen from the later part of the order, he did not even examine whether the AO made addition or disallowed expenditure. AO brought an amount of ₹ 15,77,330/- to tax as an addition under the head income from other sources, even after accepting that an amount of ₹ 1,50,300/- pertains to a firm. Without even understanding whether the amount was an addition to the income returned or disallowance of the expenditure claimed, the Ld. CIT(A) c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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