TMI Blog2016 (9) TMI 1287X X X X Extracts X X X X X X X X Extracts X X X X ..... epresented income. - Decided in favour of assessee. - ITA No. 3534/Del/2014 - - - Dated:- 15-9-2016 - H. S. Sidhu (Judicial Member) For the Assessee : Gautam Jain, Piyush Kr. Kamal For the Revenue : Amrit Lal ORDER The Assessee has filed the Appeal against the Order dated 8.5.2014 of the Ld. CIT(A)-Rohtak pertaining to assessment year 2007-08 and raised the following grounds:- 1. That the order passed by the Learned CIT (Appeals) Rohtak is contrary to the facts, written submissions and provisions of Law. 2. That the Learned CIT (A) Rohtak has grossly erred in not considering the Learned Tehsildar certificates where the amount of ₹ 4942000/- the sales price of agricultural land is duly mentioned with the rate of per acre. 3. That the Learned CIT(A) Rohtak has also erred in not considering the duly sworned affidavit of Sh. Mohar Singh the husband of appellant who had deposited a sum of ₹ 4942000/- in the appellant's bank account with its sources against which the proceedings were initiated. 4. That sustain it in the additions of ₹ 3301000/- made by AO by the appellate Authority is quite arbitrary, excessive unjustified. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al ground raised by the assessee, in view of the case law of NTPC Limited (Supra) and proceed to decide the additional ground first. 6. The brief facts of the case are that in this case on the basis of AIR information available, the assessee had deposited cash of ₹ 49,42,000/- on 10.8.2006 in her saving bank account no. 7666 with Canara Bank, Palhawas, Rewari during the financial year 2006-07 relevant to the year under proceeding. Notice u/s. 148 of the I.T. Act, 1961 was issued on 16.3.2012 after recording the reasons. Assesee filed her return of income of ₹ 50,240/-. Notices u/s. 143(2)/143(1) were issued on 12.10.2012 and the reasons recorded were duly supplied to the assessee. In compliance of notices, Assessee s Representative attended the assessment proceedings and furnished the information and details and written reply. After perusing the same the AO added the additions and assessed the income of the assessee at ₹ 33,82,160/- by completing the assessment u/s. 143(3)/148 of the I.T. Act, 1961 vide his order dated 6.3.2013. 7. Against the Order of the AO, assessee appealed before the Ld. CIT(A), who vide impugned order dated 08.5.2014 has dismissed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the AO has properly recorded the reasons for reopening by due application of mind, hence, the appeal of the Assessee may be dismissed. 11. We have heard both the parties and perused the relevant records available with us, especially the orders of the revenue authorities and the case laws cited by the assessee s counsel on the issue in dispute. In our view, it is very much necessary to reproduce the reasons recorded by the AO before issue of notice u/s. 148 for reopening of assessment which reads as under:- As per AIR information for FY 2006-07 received in this office, the assessee has made cash deposits of ₹ 49,42,000/- in bank account with Canara Bank, Pulhawas, Rewari. A query notice was issued to the assessee on 24.1.2012. But no response has been received from the assessee. I, therefore have reason to believe that the assesse has deposited cash in his bank account out of his income from unexplained sources. Accordingly, income to the extent of ₹ 49,42,000/- and any other income which subsequently comes to the notice of the undersigned has escaped assessment within the meaning of section 147 of the I.T. Act, 1961. Issue notice u/s. 148 of the I.T. Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TO reported in 159 ITD 329 (Asr) wherein it has been held as under and the decision of Bir Bahadur Singh Sijawali (Supra) has been followed in this case. 44. It is this question which takes us back to the applicability/nonapplicability of the decision in Bir Bahadur Singh Sijwali (supra). The ratio thereof has not at all been disputed by the Department. In fact, the only dispute which has been raked up is the applicability or otherwise thereof to the facts of the present case, in view of the position that the initiation of the assessment proceedings U/S 147 in the present case stands preceded by the issuance of the alleged enquiry letter by the ITO. This dispute has been dealt with in detail in the foregoing paragraphs. 45. In 'Bir Bahadur Singh Sijwali' (supra), it has been held that where the AO issued a notice U/S 148 on the ground that there was, fin escapement of income and the belief regarding such escapement of income was formed on the fallacious assumption of the AO that bank deposits constituted undisclosed income, overlooking the fact that the source of the deposits need not necessarily be the income of the assessee, the reassessment proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee from assessment. 47. It was further 'Observed as follows: 8. Let us, in the light of this legal position, revert to the facts of the case before us. All that the reasons recorded for reopening indicate is that cash deposits aggregating to ₹ 10,24,100/- have been made in the bank account of the assessee, but the mere fact that these deposits have been made in a bank account does not indicate that these deposits constitute an income which has escaped assessment. The reasons recorded for reopening the assessment do not make out a case that the assessee was engaged in some business and the income from such a business has not been returned by the assessee. As we do not have the liberty to examine these reasons on the basis of any other material or fact, other than the facts set out in the reasons so recorded, it is not open to us to deal with the question as to whether the assessee could be said to be engaged in any business; all that is to be examined is whether the fact of the deposits, per se, in the bank account of the assessee could be basis of holding the view that the income has escaped assessment. The answer, in our humble understanding, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sits need not necessarily be the income of the assessee. That being so, in keeping with 'Bir Bahadur Singh Sijwali' (supra), the reasons recorded to initiate assessment proceedings under section 147 of the Act and all proceedings pursuant thereto, culminating in the impugned order, are cancelled. Ground No.2 is, accordingly, accepted. C. Apex Court judgment in the case of Parimisetti Setharamamma vs. CIT reported in 57 ITR 532 has held as under:- By sections 3 and 4 the Act imposes a general liability to tax upon all income. But the Act does not provide that whatever is received by a person must be regarded as income liable to tax. In all cases in which a receipt is sought to be taxed as income, the burden lies upon the department to prove that it is within the taxing provision. Where however a receipt is of the nature of income, the burden of proving that it is not taxable because it falls within an exemption provided by the Act lies upon the assessee. The appellant admitted that she had received jewellery and diverse sums of money from Sita Devi and she claimed that these were gifts made out of love and affection. The case of the appellant was that the recei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6), the prescribed Authorities had the power to call for any information from any person which would be useful for, or relevant to, any proceeding under the Act. The amendment in subsection (6) empowers the prescribed Authorities to call for information for the purpose of any inquiry under the Act even in cases where no proceeding is pending. However, an Income Tax Authority below the rank of Director or Commissioner can exercise the said power in respect of an inquiry only with the prior approval of the Director or the Commissioner. 18. In the present case, the enquiry letter dated 13.03.2008 was issued by the Income Tax Officer, i.e., an Officer below the rank of the Income Tax Authorities referred to in the second proviso to section 133(6). Thus, in keeping with the said second proviso to section 133(6), prior approval was required to be obtained from the competent Authority before exercising power under section 133(6). 19. There is nothing on record to suggest that any such prior approval was obtained herein. The letter, per se, also does not make mention of any such approval. Hence, the power exercised by the ITO, without compliance with the second proviso to section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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