9911796707
TMI Blog2022 (6) TMI 1099X X X X Extracts X X X X X X X X Extracts X X X X ..... 08/2019, for Assessment Year (AY) 2012-13, by the Principal Commissioner of Income Tax-1, Jabalpur ('Pr.CIT') vide his separate orders of even date, i.e., 25/01/2022. 2. The brief facts of the case are that proceedings u/s. 147 of the Act were initiated on 30/03/2019 upon receipt of information that the assessees had sold land for Rs. 50 lacs, as no capital gain (long term or short term), much less in terms of s. 50C, had been returned by them per their returns of income for the relevant year (copy of the reason/s recorded u/s. 148(2) at PB pgs. 5-6). The assessees, who had in fact jointly purchased the said land (for Rs. 50 lacs), clarified to the Assessing Officer (AO) in the reassessment proceedings that they had not sold any land durin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e basis for the reassessment proceedings is the reason/s to believe non-returning and, thus, escapement of income by way of capital gains from tax. The assessees having admittedly not sold any land during the relevant year, it removes the very basis of the reassessment proceedings. The information giving rise to the reason to believe escapement of income is found wrong as a fact, and there has been thus no valid assumption of jurisdiction to assess. This is in fact primarily the reason for the Apex Court instituting a procedure in GKN Driveshafts (India) (P.) Ltd. v. ITO [2002] 259 ITR 19 (SC), requiring an assessee to object to the reason/s recorded, which the AO is supposed to meet per a speaking order before proceeding further in the mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... returning of capital gain on the sale of land (for Rs. 50 lacs) by the assessee/s during the relevant year in the instant case? That is, it is a case of no reason at all, striking at the root of the assumption of jurisdiction to assess. Rather, as Shri Usrethe would point out during hearing, the AO was not in the possession of sale (purchase) deed at the time of recording the reason to believe and issue of notice u/s. 148(1) on 30/03/2019 inasmuch as the letter seeking information regarding, as the AO states in his order (para 1): 'sold of immovable property', was issued by him to the Sub- Registrar only on 16/04/2019, i.e., 17 days later. A reason to believe escapement of income from tax is a jurisdictional issue, which accordingly the law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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