TMI Blog1973 (7) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 26th March, and 31st March, 1970, under section 148 of the Income-tax Act, 1961, for the assessment year 1961-62 issued upon the respondent. The respondent is a company incorporated under the Indian Companies Act. For the assessment year 1961-62, the said company was assessed under section 23(3) of the Indian Income-tax Act, 1922 (hereinafter referred to as "the old Act") and the Income-tax Officer, "E" Ward, Companies Dist. III, computed the total income of the company at Rs. 70,692. The said assessment was, however, rectified subsequently by the said officer by his three orders dated 22nd March, 1962, 7th July, 1973, and the total income was finally computed at Rs. 41,519. The said company's assessment had been completed under the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he possession of the Income-tax Officer on which lie could have reasons to believe that the respondent-company's income had escaped assessment for the said year 1961-62. It was pointed out in the said letter that the conditions precedent for assumption of jurisdiction under the provisions of section 147 of the new Act had not been satisfied and the Income-tax Officer had absolutely no materials on which he had reasons to believe that the respondent-company's income had escaped assessment and, as such, the said Income-tax Officer had no jurisdiction and/or authority to reopen the said assessment on a mere change of opinion. It was further contended that there was no new or fresh information in the possession of the said Income-tax Officer in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion has got no application in the facts and circumstances of the present case. In Sheo Nath Singh's case, the reasons for such belief, inter alia, is as follows: (1) The assessee who is or was at the relevant time a managing director in about a dozen limited companies along with "Oberois" is believed to have made some secret profits which were not offered for assessment. (2) The assessee is believed to have received a sum of Rs. 22 lakhs from "Oberois" and this sum or at least part of which represents income which has escaped assessment. The Supreme Court observed that it was abundantly clear that two reasons which were given for the belief which was formed by the Income-tax Officer hopelessly failed to satisfy the requirements of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st March, 1965, was produced before us. The said statement was recorded on the 8th December, 1966. It appears from that statement that the said Giridhari Singh has said: "I am affirming that all the hundies loan transactions that might be attributed to me and might be shown in any party's book as taken from me are bogus and in no instance had I lent any money against hundies. During the entire period 1952 or 1953 to 31st March, 1965, whatever hundi loan appeared in my name in any party at Calcutta, Delhi, Bombay or in any other place, these loans were not really loans and I acted merely as name-lender." In the balance-sheet which was submitted by the respondent it appears that material loans from sundry parties were shown as Rs. 3,50,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for the belief cannot be investigated by the court. Considering the facts and circumstances of the case, we are unable to agree with the contentions of Mr. Balai Lal Pal that the learned trial judge erred in applying the principles laid down by the Supreme Court in the case of Sheo Nath Singh. We are satisfied that there is no material or fact which has been stated in the reasons in starting proceedings in the present case on which any belief could be founded of the nature contemplated by section 147(a) of the Income-tax Act, 1961. We find no reason to differ from the view of the learned trial judge that the conditions precedent for the reopening of the said assessment had not been fulfilled in the instant case. In the result, this ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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