TMI Blog2016 (5) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 147 of the Act have not been satisfied by the Revenue. - Decided in favour of assessee - W. P. (C) 8994/2014 & CM 20547/2014 - - - Dated:- 18-2-2016 - Justice S. Muralidhar And Justice Vibhu Bakhru, JJ. W. P. (C) 9014/2014 CM 20601/2014, W.P.(C) 9015/2014 CM 20603/2014, W.P.(C) 9386/2014 CM 21216/2014, W.P.(C) 9387/2014 CM 21218/2014, W.P.(C) 9388/2014 CM 21220/2014, W.P.(C) 9430/2014 CM 21298/2014, W.P.(C) 135/2015 CM 205/2015, W.P.(C) 823/2015 CM 1432/2015, W.P.(C) 824/2015 CM 1434/2015, W.P.(C) 825/2015 CM 1436/2015, W.P.(C) 826/2015 CM 1438/2015 For the Petitioners : Mr. Salil Kapoor, Mr. Sanat Kapoor, Ms. Ananya Kapoor, Mr. Arun Vir Singh and Mr. Sumit Lal Chandani, Advocates. For the Respondent : Mr. Rahul Chaudhary, Senior Standing Counsel. ORDER Dr. S. Muralidhar, J. 1. These are two sets of writ petitions filed by Sabharwal Apartments Private Limited ( SAPL ) and Sabharwal Properties Industries Private Limited ( SPIPL ) challenging the notices issued to each of them under Section 148 of the Income Tax Act, 1961 ( the Act ) on 28th March, 2014 in respect of Assessment Years (AYs) 2007-2008 to 2012-2013. 2. While ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 12.12.2013. During the course of survey conducted at the premises of the assessee company M/s Sabharwal Apartment Pvt. Ltd (SAPL) Sabharwal Properties Ind. Pvt. Ltd. (SPIPL) were alleged to have shown unsecured loans of ₹ 9.65 crore during F.Y. 2010-11 (A.Y. 2011-12) M/s Mahima Distributors Pvt. Ltd. (MDPL) Kolkata which was acquired by purchase of shares by four company was more than ₹ 9 crores but purchased for ₹ 37 lacs while other companies who acquired shares in the same company had paid huge premium over and above the par value of ₹ 10/- per share of (MDPL) in F.Y. 2006-07(A.Y. 2007-08). The issue is being investigated by Investigation Wing, Kolkata for verifying the receipt of share premium by MDPL and report awaited. Further computation of long term capital gain by persons/owner of properties developed by Sabharwal group through SAPL SPIPL investigation are in progress conducted by the Investigation Wing. The unsecured loans obtained by MDPL other share holders sold their shares at par value of Rs, 10 taken over by Sabharwal Apartment Pvt. Ltd. (SAPL) Sabharwal Properties Industries Pvt. Ltd. (SPIPL) remain unexplained credits u/s 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this should have a relation or a link with an objective fact, in the form of information or facts external to the materials on the record. Such external facts or material constitute the driver, or the key which enables the authority to legitimately re-open the completed assessment. In absence of this objective trigger , the AO does not possess jurisdiction to reopen the assessment. There has to be a definite recording in the reasons that there was an escapement of income as a result of failure on the part of the Assessee to disclose fully and truly all the material facts necessary. 10. In CIT v. Kelvinator of India Ltd. (2010) 320 ITR 561 (SC), the Supreme Court reiterated that, under Section 147 of the Act, the AO does not have the power to reopen an assessment on the basis of mere change of opinion . It observed: ....the Assessing Officer has no power to review; he has the power to re-assess. But re-assessment has to be based on fulfilment of certain pre-condition and if the concept of change of opinion is removed, as contended on behalf of the Department, then, in the garb of re-opening the assessment, review would take place. One must treat the concept of change ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of the Act. 3. It is not true to state that there is no alleged escapement of income for the year under consideration. The assessee purchased a company M/s Mahima Distributors Pvt. Ltd., Kolkata for ₹ 37 lac though the investment of this company was 9 crore. Not so much, the other companies purchased the shares of this company during F.Y. 2006-07 relevant to A.Y. 2007-08 after payment of huge premium. This company was found bogus and was only operation on paper and no actual transactions were going on as per the statement of the Director of M/s. MDPL recorded by the Investigation Wing, Kolkata. 4. There is a clear mentioned in the reasons that the escapement of income is more than ₹ 1 lac and therefore, the permission has been sought from Addl. CIT Range 7 u/s 151(2) which was granted. ...... 8. As already stated that the transactions of all the years re-opened are inter-linked and sufficient material is available on record to show that the income escaped in every year is more than. DIT (Investigation) Kolkata has recorded the statement of various persons who has made transactions with MDPL and all are found on enquiry as bogus. Their statements a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e amount declared in the VDIS (Rs.7,23,490/). The reasons recorded however are not so explicit and do not refer to this fact. We are to be guided only by the reasons recorded for re-assessment and not by the reasons or explanation given by the Assessing Officer at a later stage in respect of the notice of re-assessment. ........... The ratio laid down in all these cases is that, having regard to the entire scheme and purpose of the Act, the validity of the assumption of jurisdiction under Section 147 can be tested only by reference to the reasons recorded under Section 148(2) of the Act and the Assessing Officer is not authorised to refer to any other reason even if it can be otherwise inferred and/ or gathered from the records. He is confined to the recorded reasons to support the assumption of jurisdiction. He cannot record only some of the reasons and keep the others up his sleeves to be disclosed before the Court if his action is ever challenged in a Court of law. 17. Even otherwise even the above reasons given subsequently do not satisfy the jurisdictional requirements of Section 147 (1) of the Act inasmuch as they do not indicate that there was a failure by the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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