TMI Blog2022 (10) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... led to have carried out verifications as regards the unsecured loans that were raised by the assessee during the year from seven parties, and also failed to disallow under Sec. 40(a)(ia) her claim for deduction of interest that was paid to the aforesaid lenders i.e, without deduction of tax at source, as both of the said issues were independent issues that were unconnected with the reason on the basis of which her case was reopened under Section 147. In sum and substance, as the view taken by the AO i.e., not making of any independent addition/disallowance in the absence of any addition as regards the issue on the basis of which the case of the assessee was re-opened, is found to be in conformity with the judgment in the case of Jet Airways (I) Ltd. [ 2010 (4) TMI 431 - HIGH COURT OF BOMBAY ] therefore, we are unable to concur with the view taken by the Pr. CIT that the failure on the part of the AO to carry out verifications and/or make addition/disallowance as regards such independent and unconnected issues would render the order passed by him under Sec. 143(3) r.w.s 147, dated 23.11.2018 as erroneous in so far as it was prejudicial to the interest of the revenue under Sec. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Pr. CIT-I is illegal, bad in law as regards to disallowance u/s 40(a)(i) of interest Rs. 9,16,221/- paid on loan, since assesse has obtained form no. 15G from the respective lenders and hence, not required to deduct TDS u/s. 194A of the I.T. Act. 7. That, the order passed u/s 263 by the Pr. CIT-I is illegal, bad in law since the same is passed against the facts of the case and law applicable thereto. 8. That the order passed u/s.263 by the Pr. CIT-I is illegal, bad in law since the same is passed against the facts of the case and law applicable thereto. 9. That, without prejudice to the ground raised above, the Pr. CIT-I has erred in directing the assessing Officer to reassess the income of the assessee afresh after examining the relevant details and other issues. 10. That, the assessee craves leave to alter, amend or withdraw all or any objections herein or add any further grounds as may be considered necessary either before or during the course of hearing. 2. Succinctly stated, the assessee who is engaged in the business of trading of electrical wires and cables had filed her return of income for the assessment year 2011-12, declaring an income of Rs.4,69, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act, dated 22.02.2021 the assessee has carried the matter in appeal before us. 7. We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by them to drive home their respective contentions. After deliberating at length on the issue under consideration, we find substance in the claim of the Ld. AR, that now when the Assessing Officer while framing the re-assessment u/s. 143(3) r.w.s 147 of the Act, dated 23.11.2018 had not made any addition as regards the very reason on the basis of which the case of the assessee was reopened i.e., source of cash deposits of Rs. 27,15,500/- in the assessee s Saving bank account with State Bank of Bikaner Jaipur, therefore, in absence of any addition on the said count, it was not permissible for him to have made any independent verifications and/or additions/disallowances in the hands of the assessee. Our aforesaid view is fortified by the judgment of the Hon ble High Court of Bombay in the case of CIT Vs. Jet Airways (I) Limited (2011) 331 ITR 236 (Bom), wherei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re nugatory. Sec. 147 has this effect that the AO has to assess or reassess the income ( such income ) whichescaped assessment and which was the basis of the formation of belief and if he does so, he can also assess or reassess any other income which has escaped assessment and which, comes to his notice during the course of the proceedings. However, if after issuing a notice under s. 148, he accepted the contention of the assessee and holds that the income which he has initially formed a reason to believe had escaped assessment, has as a matter of fact not escaped assessment, it is not open to him independently to assess some other income. If he intends to do so, a fresh notice under s. 148 would be necessary, the legality of which would be tested in the event of a challenge by the assessee. We have approached the issue of interpretation that has arisen for decision in these appeals, both as a matter of first principle, based on the language used in s. 147(1) and on the basis of the precedent on the subject. We agree with the submissions which has been urged on behalf of the assessee that s. 147(1) as it stands postulates that upon the formation of a reason to believe that incom ..... X X X X Extracts X X X X X X X X Extracts X X X X
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