TMI Blog2019 (10) TMI 905X X X X Extracts X X X X X X X X Extracts X X X X ..... he foregoing discussion, it is clear that the reasons recorded by the AO for initiating re-assessment proceedings are invalid and do not justify initiation of re-assessment. Even though the original summary assessment was made u/s 143(1) of the Act and the period of four years from the end of the assessment year had not expired before issuing notice u/s 148 of the Act, still, the AO, having missed the opportunity of making assessment u/s 143(3) after issuing notice u/s 143(2) of the Act within the stipulated period, could have made assessment or reassessment u/s 147 only on the basis of the some reasons to believe about the escapement of income. Existence of reasons for escapement of income are sine qua non to embark upon the assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alled `the Act ) which was issued on 19-03-2012 alleging that the source of loan given by the assessee to Kanhaiyalal Vishandas Gidwani to the tune of ₹ 7.00 lakh was not substantiated. The assessee filed return in response to such notice and then sought reasons leading to the issuance of notice u/s.148. Objections were raised after receiving the reasons, which were dealt with by the AO by means of a separate order. Thereafter, the AO espoused the assessment determining total income at ₹ 46,03,300/- as against the returned income of ₹ 9,96,340/-. The assessee, inter alia, challenged the initiation of re-assessment before the ld. CIT(A) but without success and thus is now aggrieved before the Tribunal. 4. We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, in view of the above, I have reasons to believe that the income chargeable to tax has escaped assessment within the meaning of s ection 147 of the I. T. Act, 1961. 5. It can be seen from the above extracted reasons that the first para talks of Kanhaiyalal Gidwani acquiring three flats, one in his name and two in the names of his sons in Adarsha Housing Society, which has no relation with the assessee in question. Second para relates to the assessee as per which Kanhaiyalal Vishandas Gidwani took two interest free loans of ₹ 5.00 lakh and ₹ 2.00 lakh from the assessee on 08-03-2007 and 25-11-2008. The first loan of ₹ 5.00 lakh is dated 08-03-2007, which transaction falls in the previous year ending 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge 25 of the paper book, which shows opening credit of balance of ₹ 20.00 lakh. Then there are two payments made by the assessee to Kanhaiyalal Vishandas Gidwani through HDFC bank amounting to ₹ 2.00 lakh and ₹ 31,500/- with closing balance of ₹ 17,68,500/-, which finds place in the assessee s balance sheet filed with the original return of income. 7. From the above narration of facts, it is amply clear that firstly the assessee did not advance any loan to Kanhaiyalal Vishandas Gidwani amounting to ₹ 2.00 lakh as has been alleged in the reasons. On the contrary, it is a case of repayment of loan of ₹ 2.00 lakh as against the opening balance of loan of ₹ 20.00 lakh. The reasons noted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -assessment. 8. Even though the original summary assessment was made u/s 143(1) of the Act and the period of four years from the end of the assessment year had not expired before issuing notice u/s 148 of the Act, still, the AO, having missed the opportunity of making assessment u/s 143(3) after issuing notice u/s 143(2) of the Act within the stipulated period, could have made assessment or reassessment u/s 147 only on the basis of the some reasons to believe about the escapement of income. Existence of reasons for escapement of income are sine qua non to embark upon the assessment or reassessment u/s 147 of the Act. Change or no change of opinion, as argued by the ld. DR, are the factors to be considered after fulfilling th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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