TMI Blog2023 (3) TMI 1112X X X X Extracts X X X X X X X X Extracts X X X X ..... as simply rubber-stamped the proposal We are inclined to accept the submissions made by Mr Syali that this was not a fit case for triggering reassessment proceedings, contrary to what has been held by respondent no.2. More so, the material placed on record by the petitioner had, in our opinion, failed to establish a nexus with the belief formed by respondent no. 1, that the income chargeable to tax in the relevant AY, i.e., AY 2016-17, had escaped assessment. Decided in favour of assessee. - HON'BLE MR JUSTICE RAJIV SHAKDHER AND HON'BLE MS JUSTICE TARA VITASTA GANJU Petitioner Through: Mr M.S Syali, Sr. Adv. with Ms Mahua Kalra Mr Tarun Singh Advs. Respondents Through: Mr Abhishek Maratha, Sr. Standing Counsel. [Physical Hearing/Hybrid Hearing (as per request)] RAJIV SHAKDHER, J.: (ORAL) PREFACE 1. This writ petition seeks to challenge the notice dated 30.03.2021 issued under Section 148 of the Income Tax Act, 1961 [in short, Act ] concerning Assessment Year (AY) 2016-2017. 2. The broad facts which are required to be noticed to adjudicate this writ petition are the following: i. The petitioner envisaged interest, it app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 017, the petitioner, once again claimed depreciation on the Flat and disclosed his outstanding liability, qua the loan taken from HDFC Bank. 10.1 In this year, the petitioner had declared Rs. 99,36.090/- as his income chargeable to tax. 10.2 Return for the said AY was filed on 18.10.2016. 11. There is no dispute raised before us that the return for AY 2016-2017 was accepted under Section 143(1) of the Act. 11.1 Intimation regarding the same was issued to the petitioner on 05.01.2017. 12. It appears that a rectification order under Section 154 of the Act was passed on 17.05.2017 regarding correction in the tax refund payable to the petitioner for AY 2016-2017. 13. The trouble, so to say, for the petitioner began when a notice dated 17.09.2019 under Section 133(6) of the Act was issued to him. 13.1 This notice was issued on 17.09.2019, whereby several queries were raised and information was sought regarding the Flat. 13.2 Interestingly, the queries raised concerned FY 2015-2016, relatable to AY 2016-2017. 14. We have on record the response filed by the petitioner to the notice issued under Section 133(6) of the Act. 14.1 This response is dated 24.09.2019 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent/revenue, the sale was consummated in the preceding AY and therefore, reassessment proceedings could not have been triggered for the AY in issue i.e., AY 2016-2017. v. Fifth, the amount paid by the petitioner towards stamp duty, i.e., Rs 31,11,500/-, cannot be construed as unexplained expenditure and brought to tax under Section 69C of the Act. 18. Mr Abhishek Maratha, who appears on behalf of the respondent/revenue, on the other hand, submits that all issues which have been raised by the petitioner can be verified and examined in the reassessment proceedings. 18.1 Mr Maratha, in sum, seeks to rely upon the order disposing of the objections dated 03.12.2021 in support of the respondent's/revenue s case. ANALYSIS AND REASONING 19. We have heard learned counsel for the parties and examined the record. According to us, first and foremost, what is most disconcerting is that the AO has failed to take into account the material on record, i.e., the objections filed by the petitioner and the response given by him to the notice dated 24.09.2019 issued under Section 133(6) of the Act. 20. The petitioner not only explained the source of his income b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Tradelinks Pvt. Ltd. v Income Tax Officer, Ward 22(4) (2021) 435 ITR 642 , being pertinent, are set forth hereafter: 35. This apart, what is even more disconcerting is the fact that respondent no.2, who accorded sanction for triggering the process under Section 147 of the Act, simply rubber-stamped the reasons furnished by respondent no.1 for issuance of notice under Section 148 of the Act. 36. The provisions of Section 151(1) of the Act required respondent no.2 to satisfy himself as to whether it was a fit case in which sanction should be accorded for issuance of notice under Section 148 of the Act and, thus, triggering the process of reassessment under Section 147. The sanction-order passed by respondent no.2 simply contains the endorsement approved . 37. In our view, the sanction-order passed by respondent no.2 presents, metaphorically speaking, the inscrutable face of sphinx (See: Breen v. Amalgamated Engineering Union [1971] 2 QB 17500; Also see: State of H.P. v. Sardara Singh, (2008) 9 SCC 392). In our view, the satisfaction arrived at by the concerned officer should be discernible from the sanction-order passed under Section 151 of the Act. In this con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the reasoning set out by the ITO was to be agreed upon, the least, which is expected, is that an appropriate endorsement is made in this behalf setting out brief reasons. Reasons are the link between the material placed on record and the conclusion reached by an authority in respect of an issue, since they help in discerning the manner in which conclusion is reached by the concerned authority. Our opinion is fortified by the decision of the Apex Court in Union of India v. M.L. Capoor and Ors. MANU/SC/0405/1973 : AIR 1974 SC 87 wherein it was observed as under: 27. We find considerable force in the submission made on behalf of the Respondents that the rubber-stamp reason given mechanically for the supersession of each officer does not amount to reasons for the proposed supersession . The most that could be said for the stock reason is that it is a general description of the process adopted in arriving at a conclusion. 28. If that had been done, facts on service records of officers considered by the Selection Committee would have been correlated to the conclusions reached. Reasons are the links between the materials on which certain conclusions are based ..... X X X X Extracts X X X X X X X X Extracts X X X X
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