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TMI Blog2023 (1) TMI 472X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred to as "the Act") relevant to the Assessment Year 2006-07. 2. The assessee has raised following grounds of appeal: "1. The Ld. CIT(A)-5, Vadodara has erred in law and in facts in confirming the action of the Ld. A.O. in the issue of notice of reassessment u/s. 148 on 02.07.2010 ignoring the fact that the assessment for the year was completed u/s. 143(3) dated 29.12.2008 wherein the issue relating to the receipt of loan was duly examined. The reassessment made being in disregard of facts and in law is prayed to be set aside. 2. The Ld. CIT(A)-5, Vadodara has erred in law and in facts confirming the addition of an amount of Rs. 1,59,58,825/- being the amount of loan received from Shri Mahendra Dhurlabhji Desai holding that the gen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to Rs. 1,59,58,825/- only. 6. The assessee vide letter dated 28-12-2011 objected the initiations of income escapement proceeding on reasoning that the issue of credit of impugned loan was verified in detail by the AO during the regular assessment proceeding under section 143(3) of the Act. After such detailed enquiry and verification, the AO accepted genuineness of impugned credit. Therefore, the reopening of assessment again to verify the same credit of loan will amount to review of own order which is not in the jurisdiction of the AO. 7. However, the AO without considering the objection of the AO framed the income escapement assessment under section 147 of the Act and assessed the income at Rs. 1,59,32,110/- only. 8. On appeal by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the approval granted by the Ld. Additional CIT under section 151 of the Act is not proper and without application of mind. As per the learned AR the approval has been given by the ld. Additional CIT for general scrutiny assessment whereas the proceedings have been initiated under income escaping proceedings. 12. On the other hand,the learned DR before us vehemently supported the order of the authorities below. 13. We have heard the rival contentions of both the parties and perused the materials available on record. The powers of assessment-reassessment are conferred on the Assessing Officer by the provisions of section 147/148 of the Act. But such power is subject to the certain conditions laid down under section 147/148/149/151 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after the expiry of four years from the end of the relevant assessment year, unless the 36[Joint] Commissioner is satisfied, on the reasons recorded by such Assessing Officer, that it is a fit case for the issue of such notice.]" 14. We note that the AO has after recording reason to believe sent a letter in specified format before additional commissioner for sanction of reopening as per the provision of section 151 of the Actwhich was approved by the ACIT by noting "yes". However, on perusal of such approval request letter, we find that such request was with regard to general scrutiny under section 143(3) of the Act and not under the income escapement proceeding under section 147/148 of the Act. The relevant heading for approval letter re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inhjiKaran Sinhji Jadeja v. State of Gujarat AIR 1959 SC 2390 has held that if a statutory authority has been vested with jurisdiction, he has to exercise it according to its own discretion. If discretion is exercised under the direction or in compliance with some higher authorities instruction, then it will be a case of failure to exercise discretion altogether. In the given case what inferred is this that the learned Additional commissioner noted "yes" on approval letter without any verification and application of mind. 18. In view of the above, we hold that the initiation of proceedings under section 147/148 of the Act are not valid in the eyes of law and liable to be quashed. Accordingly, we quash the same. Hence, the technical grounds ..... X X X X Extracts X X X X X X X X Extracts X X X X
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