TMI Blog2016 (11) TMI 1395X X X X Extracts X X X X X X X X Extracts X X X X ..... has specifically mentioned that for the purpose of verification/ deep verification of the claim, it is necessary to reopen the assessment. Under the circumstances, it cannot be said that the Assessing Officer had any tangible material to form an opinion that the income chargeable to tax has escaped the assessment. Under the circumstances, the impugned action of reopening of the assessment in exercise of power under Section 148 of the I.T Act for the reasons recorded hereinabove cannot be sustained. - Decided in favour of assessee - Special Civil Application No. 14612 of 2016 With Special Civil Application No. 14615 of 2016 - - - Dated:- 29-11-2016 - M. R. Shah And B. N. Karia, JJ. For the Petitioner : Tushar P Hemani, Vaibhavi K. Parikh For the Respondent : Mauna M Bhatt JUDGMENT M. R. Shah, J. As common question of facts and law arises in both these petitions, but with respect to different assesses, both these writ petitions are being disposed of by this common judgment and order. 2. Feeling aggrieved and dissatisfied with the impugned Notice dated 31st March 2016 issued by the Assessing Officer by which the Assessing Officer in exercise of power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Share holding pattern of M/s. Rushil Decor Limited. During F.Y 2008-09 relevant to A.Y 2009-10 assessee was holding 22,99,702/= shares and his holding was 26.26% which requires deep verification. Therefore, to determine the taxability and accountability, it is necessary to reopen the assessment for A.Y 2009-10. Further, on verification of the case records of the assessee, it is found that the assessee has filed his return of income for the A.Y 2009-10 on 2/11/2009 declaring the total income at ₹ 22,99,702/=. The return of income was processed u/s. 143 [1] of the I.T Act. In view of the above, I have reason to believe that by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment the income chargeable to tax amounting to ₹ 50,00,000/= and value of ₹ 28,03,922/= share has escaped assessment for the period relevant to A.Y 2009-10, as above due to failure on the part of the assessee to show. Therefore, I am satisfied that this is a fit case for re-opening of the assessment within the meaning of Section 147 of the Act by issuing notice u/s. 148 of the I.T Act. 6. That, vide communication da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer has not established as to how any transfer amongst group concerns and holding of 22,99,702 shares in M/s. Rushil Decor Limited can result into escapement of any income chargeable to tax in the hands of the assessee. It is submitted that as it transpires from the reasons recorded for reopening of assessment that the Assessing Officer merely on some suspicion as to escapement of some income chargeable to tax in the assessee s hand has sought to reopen the case for further verification of concern transactions with a hope for some income chargeable to tax might have escaped the assessment. It is submitted that mere on suspicion and for carrying out roving and/or fishing inquiry or investigation, without there being a specific finding as to escapement of income, reopening of assessment is not permissible. It is submitted that as held by this Court in catena of decisions, the reopening of assessment can be made only if the Assessing Officer has formed a belief that income chargeable to take as escaped the assessment. It is submitted by Shri Hemani, learned counsel appearing on behalf of the assessee that in the present case, in the reasons recorded itself as well as in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f of the respondent no.1-Revenue. It is vehemently submitted by the learned counsel for the Revenue that in the facts and circumstances of the case and considering the fact that the Assessing Officer had a reason to believe that income chargeable to tax has escaped assessment to the tune of ₹ 50 lakhs, for which no scrutiny or verification was done during the original assessment, the Assessing Officer has rightly reopened the assessment in exercise of power under Section 147 of the IT Act. 8.1 It is submitted that in the present case, the assessee filed return of income on 2nd November 2009 declaring total income at ₹ 18,54,959/= and the same was processed under Section 143 [1] of the Act, without scrutiny. It is submitted that subsequently, an information was received vide letter dated 29th March 2016 from ITO [Investigation] Unit-II, Ahmedabad that an amount of ₹ 50 lacs was transferred among the group accounts [6 accounts] without any economic rational and it was found that routing of same amount of money into different accounts without any corresponding business transaction arising was against the normal action of prudent business, since it was found that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [Guj] has submitted that what is required to be considered is fact emerging on the record/from the reasons recorded by the Assessing Officer and the language of the reasons could not be that much material. By making the above submissions, it was requested by the learned counsel for the Revenue to dismiss the present petition. 10. Heard learned advocates appearing for the respective sides at length. 11. At the outset, it is required to be noted that by the impugned notice, the assessment for AY 2009-2010 is sought to be reopened in exercise of power under Section 147 of the I.T Act. The reasons recorded to reopen the assessment are already produced hereinabove. Thus, as per the reasons recorded, the notice has been issued and assessment is sought to be reopened for deep verification of the claims. Even in the order disposing of the objections, it has been specifically stated that to verify whether all the criteria are met by the said transaction of ₹ 50 lakhs routed through the group and also to verify the claim of having recorded these transactions in the regular books of account, notice under Section 148 has been issued. Even with respect to investment in shares of M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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