TMI Blog2021 (1) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of reasons per se. We find from the proposal memo under s. 151 of the Act dated 19.03.2013 that exact reasons were pre-existing on the date of issuance of the notice. Thus, we see no merit in this first line of argument. Certain information stated to be received from the Director of Income Tax (I CI), New Delhi - No definite formation of belief towards escapement of income was existing at the time of issuance of notice by the AO. What the AO really intended is to make an objective inquiry into the correctness or otherwise of the information received from other wing of the department to find out if there is any escapement of chargeable income indeed. The AO merely seeks to conclude that there is a case for investigation to unearth an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls)-5, Ahmedabad, ('CIT (A)' in short), dated 16.02.2016 arising in the assessment order dated 29.01.2014 passed by the Assessing Officer (AO) under s. 143(3) of the Income Tax Act, 1961 (the Act) concerning AY 2009-10. 2. The grounds of appeal raised by the assessee are two fold; (i) challenging the legality of jurisdiction under section 147 of the Act and (ii) challenging the action of the Assessing Officer (AO) in making addition of ₹ 7,79,178/- on merits as unaccounted income in pursuance of alleged wrongful jurisdiction assumed under s. 147 of the Act. 3. When matter was called for hearing, the learned counsel for the assessee, at the outset, challenged the action of the AO in usurping jurisdiction under section 147 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the notice. Thus, we see no merit in this first line of argument. 4. The learned counsel next adverted to the body of reasons recorded and contended that a bare reading of the reasons recorded would show that the initiation of proceedings under s. 147 of the Act by the AO is based on certain information stated to be received from the Director of Income Tax (I CI), New Delhi vide a letter dated 07.03.2013. Based on such information, the AO has proposed to reopen the case inter alia with expression the said transactions required to be verified thoroughly . The learned counsel in this context submitted that no reference to the nature and description of information purportedly received from the office of Director of Income Tax is discerni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent with the mandate of law and therefore requires to be quashed. 5. The Ld. DR on the other hand relied upon the orders of the authorities below to defend the action of the Revenue. 6. We have carefully considered the rival submissions. We have also perused the reasons recorded for issuance of notice under section 147 of the Act which is under challenge. It will be apt to reproduce reasons recorded hereunder for easy reference:- The assessee has filed its return of income for the A.Y. 2009-10 on 25/09/2009 declaring total income of ₹ 22,60,660/- The same was processed u/s. 143(1) of the Act. However, no scrutiny assessment u/s. 143(3) has been made. The Search Seizure action was carried out by the Department on 25.11.200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ression that powers exercised under section 147 of the Act was to enable the AO to carry out detailed verification of the various aspects of such matter in reference made to the AO herein by the office of Director of Income Tax, Delhi. Thus, it is self-evident that no definite formation of belief towards escapement of income was existing at the time of issuance of notice by the AO. What the AO really intended is to make an objective inquiry into the correctness or otherwise of the information received from other wing of the department to find out if there is any escapement of chargeable income indeed. The AO merely seeks to conclude that there is a case for investigation to unearth and ascertain truthfulness of alleged transactions. This is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t holding at least prima facie belief towards escapement of income based on relevant material. The conditions set out for invocation of Section 147 of the Act have not been met in the instant case. Hence, the notice issued under section 148 of the Act is not backed by authority of law and consequently bad in law. 6.4. The assessment under section 147 of the Act as a sequel to the illegal notice under section 148 of the Act is therefore a nullity and requires to be quashed. 7. In the result, the assessee succeeds on legal ground towards validity of jurisdiction under section 147 of the Act. Neither has the learned counsel for the assessee addressed us on the aspects of merits at the time of hearing nor do we consider it necessary to dw ..... X X X X Extracts X X X X X X X X Extracts X X X X
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