TMI Blog2023 (8) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the search. It is trite law that burden is on the revenue to prove that the price had been under stated and no addition is possible without any inquiry. In this case, there is no cogent material to support the reopening of the assessment within the meaning of section 147 and that the appellant has actually paid higher amount than that recorded in the registered sale deed and the AO did not conduct any inquiry to bring some material to corroborate the notings found in the diary allegedly contained dealings in respect of certain properties purchased the assessee, except relying on the statement of Shri Madan Mohan Gupta. Therefore, following the earlier order of this Tribunal in the case of Shri Navrattan Kothari [ 2017 (12) TMI 860 - ITAT JAIPUR] wherein exactly same facts were involved and after considering the various judicial pronouncements on the issue held the issue of notice u/s 147 without jurisdiction, we hold that the reopening of the assessment after four years from the end of the assessment year under consideration and also with reference to the provisions of section 151 is not valid and the same is quashed. Decided in favour of assessee. - ITA Nos. 238/JP/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. In the facts and circumstances of the case and in law the ld. AO has erred not providing the copies of the material. statements, relevant documents, etc used against the assessee for making addition of Rs. 4,24,14,300 u/s 69. The action of the ld AO is illegal, unjustified and arbitrary and against the principles of natural justice. Appropriate relief may please be granted. 6. The assessee craves his right to add, amend, or alter any of the grounds on or before the hearing. ITA NO. 728/JP/2019 : 1. That the Commissioner of Income Tax (Appeals) -1, Jodhpur (camp at Jaipur) has grossly erred in observing that there is no infirmity in the initiation of re- assessment proceedings by the AO. 2. That the CIT (A) has grossly erred in upholding the validity of re- assessment proceedings. 3. That the assessment order dated 09.03.2015 is per se illegal arbitrary and in violation of principals of natural justice. 4. That the CIT (A) has grossly erred in upholding the addition of Rs. 15,00,000 by rejecting the deduction under section 54F in respect of investment in immovable property claimed on the basis of undisputed valuation report of the registered valuer. 5. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred not providing the copies of the material, statements, relevant documents, etc used against the assessee for making addition of Rs. 67,98,375 u/s 69. The action of ld. AO is illegal, unjustified, arbitrary and against the principles of natural justice. Appropriate relief may please be granted. 7. The assessee craves his right to add, amend, or alter any of the grounds on or before the hearing. ITA NO. 238/JP/2020 A.Y. 2007-08. 2. The brief facts of the case are that the assessee during the relevant previous year sold agriculture land situated at village Jaisinghpura, Bankrota, Jaipur for total consideration of Rs. 2,07,80,000/- vide registered sale deed dated 01.09.2006. Assessee also purchased agriculture lands subsequent to the aforementioned sale, the details of which are as under :- Property situated at Date of purchase Purchase consideration Registry charge Total PB Gram 27.09.2006 37,50,000 2,67,950 40,17,950 32-40 Badanpura, 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e properties. The AO by issuing notice under section 148 of the IT Act proposed to assess the on money payment made by the assessee for purchase of lands as found in the statement of Shri Madan Mohan Gupta as recorded under section 132(2) of the IT Act in search and seizure proceedings carried out on 23.05.2013 and thereafter the statement of Shri Shankar Lal Saini and Shri Kanhiya Lal Saini were also recorded on 05.08.2013. The AO completed the assessment under section 144/147 of the IT Act by making additions of Rs. 4,24,14,300/- on account of undisclosed cash payment and Rs. 63,95,407/- on account of undisclosed long term capital gain in purchase / sale of land. The assessee challenged the action of the AO before the ld. CIT (A) and also challenged the validity of reopening of the case of the assessee. Before ld. CIT (A) it was submitted that the land sold by the assessee was an agricultural land and accordingly was not chargeable to tax. In this regard, evidences were submitted to the ld. CIT (A) establishing location of the land and also the fact of the land being utilized for the purpose of agricultural activities before its sale. Such evidences were submitted before the ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation ld. AO reopened the case of the assessee, without having any other corroborative evidence or without recording any satisfaction of on money , in the form of cash, having been paid by the assessee for purchase of the properties. 1.6. For the proposition, that no reopening can be done merely on the basis of information received from the Investigation Wing, as the same cannot be considered as a tangible material , warranting reopening, reliance is placed on the following judicial pronouncements- 1.6.1. SFIL Stock Broking Ltd. [2010] 325 ITR 285 (Delhi) 1.6.2. Insecticides (India) Ltd. [2013] 357 ITR 330 (Delhi) 1.6.3. Krown Agro Foods (P.) Ltd. [2015] 375 ITR 460 (Delhi) 1.6.4. RMG Polyvinyl (I)B Ltd. [2017] 83 taxmann.com 348 (Delhi) 1.6.5. Meenakshi Overseas Pvt. Ltd. [2017] 395 ITR 677 (Delhi) 1.7. In the case of Manzil Dinesh Kumar Shah [2018] 406 ITR 326 (Gujarat), the High Court, at Para 7-8, held that even the assessment which is completed u/s. 143(1) cannot be reopened without proper reason to believe . If the reasons state that the information was received from any department, then such aspects needed deep verification . Otherwis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 015, ITAT Delhi Bench 1.15. The above mentioned judgments have been followed by the Hon ble ITAT, Jaipur Bench , in the case of Shri Navrattan Kothari, in ITA No. 425/JP/2017 [Order Dated 13.12.2017], wherein under identical set of facts the entire re-assessment proceedings were quashed. Ld. CIT(A) in his order at Page 7 has relied upon the decision of Hon ble ITAT, Ahmedabad Bench in the case of Shailesh S Patel [2018] 97 Taxmann.com 570 (Ahm ITAT)], ignoring the legal position that jurisdictional ITAT had already passed order upholding the same legal position, in the case of Navrattan Kothari (Supra). In view of the above, reopening done by the ld. AO is illegal and deserves to be quashed. 4. On the contrary, the ld. CIT D/R has vehemently supported the order of the Assessing Officer. 5. We have considered the rival submissions as well as relevant material on record. During the previous year relevant to assessment year under consideration the assessee sold agriculture land situated at village Jaisinghpura, Bankrota, Jaipur for total consideration of Rs. 2,07,80,000/- vide registered sale deed dated 01.09.2006. Assessee also purchased agriculture lands subsequen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d from Raj Stamps, according to while Shri Madho Lal Saini, Shri Shankar Lal Saini and Shri Kanhaiya Lal Saini had purchase/sold land on various dated. Accordingly, to this information, Shri Madho Lal Saini S/o Shri Nanu Ram has sold agriculture land at village- Jaisinghpura, Bankrota for a sale consideration of Rs. 2,07,80,000/- on 01/09/2006. The land has is situated within 8 Kms. of municipal limits and thus, the land sold by the assessee falls within the ambit of the definition of capital asset in terms of provisions of section 2(14) of the Income Tax Act, 1961 and accordingly, the capital gain arising on sale of this land is chargeable to tax. However, the value of this property was taken at Rs. 2,07,80,000/- for the purpose of Stamp Duty. The details of purchase value of the land has not been mentioned in the deed available. Thus, the sale proceeds to the extent of Rs. 2,07,80,000/- is chargeable to tax as LTCG. Shri Madho Lal S/o Shri Nanu Lal purchase land at Village-Badanpura, Tehsil- Amer vide sale deed dated 27/09/2006 and 11/10/2006 from Shri Kanha Ram, Shri Lala Ram, Shri Nand Ram, Shri Kalu Ram of Village Bhurthal for Rs. 77,47,000/-. The description is Khasra No.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eeded on the premises that the assessee along with his two sons Shri Shankar Lal Saini and Shri Kanhiya Lal Saini had invested the money in purchase of land as aforesaid. The diary found from the possession of Shri Madan Mohan Gupta allegedly contained dealings in respect of certain properties purchased by the assessee along with his two sons, namely Shri Shankar Lal Saini and Shri Kanhiya Lal Saini. The details recorded in the seized diary found from Shri Madan Mohan Gupta revealed the payment of cash in respect of the land purchased by Saini family members i.e. father and sons. The statement of Shri Madan Mohan Gupta was recorded by Investigation Wing in which he has explained the transactions of land purchased by Saini family members. The department also recorded the statements of Shri Shankar Lal Saini and Shri Kanhiya Lal Saini and in their statements they have accepted the said transaction of purchase of land as it was through registered sale deeds but they have specifically denied any payment of cash over and above the purchase consideration shown in the respective sale deeds through cheques. Therefore, in the search and seizure proceedings and in the subsequent investigatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision. When the seized material found from Shri Madan Mohan Gupta as well as other material gathered during post search inquiry has not established any direct or proxy connection with the transaction of purchase of land by the assessee then the assumption and presumption of the AO that the assessee might have paid cash over and above the consideration shown in the sale deeds is only surmises and conjectures. We note that the Assessing Officer of the assessee, while framing the assessment under section 144 read with section 147 of the Act dated 18.03.2015 accepted the sale consideration as recorded in the sale deeds for the purpose of the assessing the capital gain. The AO, however, made additions on account of unexplained investment by them on account of cash payment reflected in the seized material. Therefore, the AO has not disturbed the sale consideration received by the assessee and his two sons in respect of sale of land. Accordingly, when the transaction of sale of land and sale consideration is accepted by the AO of the Saini family members as recorded in the sale deeds then the addition made by the AO on account of cash payment by the assessee u/s 69 of the Act has no le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the meaning of section 147of the I.T. Act, 1961. Thus, it is clear that the basis of reopening of the assessment is the seized material found during the course of search and seizure operation in the case of Rajendra Jain Group and the statement of Shri Madan Mohan Gupta recorded u/s 132(4) and 131 of the Act. The Assessing Officer analyzed the statement and the seized material for his satisfaction as recorded in paras 4 and 5 of the assessment order as under:- 4. In his statements, recorded during the course of search/post search proceedings, Shri Madan Mohan Gupta submitted that the following pagers of various exhibits are related to land transactions at Chainpura behind Entertain Paradise, Jaipur. Sr. Annexure No. Exhibit No. Page No. Found/seized from 1 Annexure A Exhibit-1 15 to 24, 27, 38, 43, 44, and 69 to 74 Residential premises 2 Annexure A Exhibit-2 47 and back side of 48, 50 to 54 Residential premises 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd statement of Shri Madan Mohan Gupta recorded u/s 132(4) of the Act for which the specific remedy is provided u/s 153C of the Act. For ready reference we quote section 153C as under:- 153C. 79 [(1)] 80 [Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that, (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, 81 belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153A, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person] 82 [and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person in accordance with the provisions of section 153A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er person, such Assessing Officer shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A. This section begins with non-obstante clause and therefore, has an overriding effect on the Sections 147 148 of the Act. As per the scheme and object of Section 153C r.w.s 153A the AO has no discretion or choice to invoke the provisions of Section 147/148 instead of section 153C r.w.s. 153A of the Act. Once the case of reassessment is made out by the AO which falls in the preview of specific provisions of section 153C of the Act, the AO cannot resort to invoke the provisions of Section 147/148 of the Act to assessee or reassess income of the assessee. The action of the AO to initiate the proceedings Under section 147/148 of the Act vitiates the entire reassessment proceedings and the assessment order. Once, the AO is satisfied that the documents seized belong to the persons other than the searched person, the Assessing Officer shall proceed against such other persons and issued notice u/s 153C and assessee or reassess income of such other persons in accordance with the provisions of section 153A of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 132 of the Act and the same were sent to the assessee's AO at Amritsar by the officer at Delhi in our view, the learned CIT(A) has correctly observed that only the provision in which any assessment could be made against the assessee in the IT Act was s. 153C r/w s. 153A of the Act. It is also apparent from the record that the officer at Delhi has mentioned in his letter that the necessary action may be taken as per law under s. 153C/148 of the Act. Hence, notice issued under s. 148 of the Act and proceedings under s. 147 of the Act by the AO are illegal and void ab initio. In view of the provisions of s. 153C of the Act, s. 147/148 stands ousted. In the instant case, the procedure laid down under s. 153C has not been followed by the AO and, therefore, assessment has become invalid. We also observe that the CIT(A) was justified in following the ratio laid down by the Hon'ble Supreme Court in the case of Manish Maheshwari v. Asstt. CIT [2007] 289 ITR 341 / 159 Taxman 258 wherein it has been held that if the procedure laid down in s. 158BD is not followed, block assessment proceedings would be illegal. The CIT(A) has correctly observed that the provisions of s. 153C are exactl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w scheme of assessment of search cases where the Assessing Officer is to assess or reassess the total income of each of the assessment years falling within the period of six assessment years immediately preceding the assessment year in which the search is conducted. Therefore, under the new scheme, the Assessing Officer is required to exercise the normal assessment powers in respect of the previous year in which the search took place. From these facts, one thing is clearly emerged that both i.e. earlier concept of Block assessment and the new scheme of assessment is separate provisions created for assessment of search cases where the search is conducted u/s 132 or requisition was made u/s 132A of the Act. 12. Under the provisions of section 147, the Assessing Officer is having power to re-open the assessment, if he is of the opinion that the income chargeable to tax has escaped assessment. Before doing so, the Assessing Officer should satisfy himself that, there is material which suggests that there is an escapement of income. The AO can exercise these powers with a reasonable belief coupled with some material which suggest the escapement of income. Once the conditions precede ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e used in section 153A. 14. In the present case on hand, admittedly, the Assessing Officer has reopened the assessment based on a search conducted in a third party case. The AO formed the opinion based on the statement recorded from the assessee, consequent to post search proceedings taken up by the DDIT(Inv), which shows undisclosed income which is the very basis of reopening the assessment. The search is conducted on 22-8-2008 which comes under the assessment year 2009-10. The Assessing Officer reopened the assessment year 2008-09, which is falling within those six assessment years immediately preceding the assessment year in which search is conducted. The assessee case falls within the provisions of section 153C, as the incriminating document seized in the case of search in another case. The Assessing Officer, on satisfying the above condition is under obligation to issue notice to the person requiring him to furnish the return for the six assessment years immediately preceding the assessment year in which search is took place. Thereafter, the Assessing Officer has to assess or reassess the total income of those six assessment years. The word shall used in section 153A ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ish the return of income of six years immediately preceding the year of search. The word used is shall and, thus, there is no option but to issue such a notice. Thereafter he has to assess or reassess total income of these six years. In this respect also, the word used is shall and, therefore, the AO has no option but to asses or reassess the total income of these six years. The pending proceedings shall abate. This means that out of six years, if any assessment or reassessment is pending on the date of initiation of the search, it shall abate. In other words pending proceedings will not be proceeded with thereafter. The assessment has now to be made u/s 153A (1)(b) and the first proviso. It also means that only one assessment will be made under the aforesaid provisions as the two proceedings i.e. assessment or reassessment proceedings and proceedings under this provision merged into one. If assessment made under sub-section (1) is annulled in appeal or other legal proceedings, then the abated assessment or reassessment shall revive. This means that the assessment or reassessment, which had abated, shall be made, for which extension of time has been provided under section 153B. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h took care of the assessment to be made in cases of search and seizure. Such an assessment was popularly known as block assessment because the Chapter provided for a single assessment to be made in respect of a period of a block of ten assessment years prior to the assessment year in which the search was made. In addition to these ten assessment years, the broken period up to the date on which the search was conducted was also included in what was known as block period. Though a single assessment order was to be passed, the undisclosed income was to be assessed in the different assessment years to which it related. But all this had to be made in a single assessment order. The block assessment so made was independent of and in addition to the normal assessment proceedings as clarified by the Explanation below Section 158BA(2). After the introduction of the group of Sections namely, 153A to 153C, the single block assessment concept was given a go-by. Under the new Section 153A, in a case where a search is initiated under Section 132 or requisition of books of account, documents or assets is made under Section 132A after 31.5.2003, the Assessing Officer is obliged to issue notices ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved by the non obstante clause with which sub section (1) of Section 153A opens. The time-limit within which the notice under Section 148 can be issued, as provided in Section 149 has also been made inapplicable by the non obstante clause. Section 151 which requires sanction to be obtained by the Assessing Officer by issue of notice to reopen the assessment under Section 148 has also been excluded in a case covered by Section 153A. The time-limit prescribed for completion of an assessment or reassessment by Section 153 has also been done away with in a case covered by Section 153A. With all the stops having been pulled out, the Assessing Officer under Section 153A has been entrusted with the duty of bringing to tax the total income of an assessee whose case is covered by Section 153A, by even making reassessments without any fetters, if need be. 21. Now there can be cases where at the time when the search is initiated or requisition is made, the assessment or reassessment proceedings relating to any assessment year falling within the period of the six assessment years mentioned above, may be pending. In such a case, the second proviso to sub section (1) of Section 153A says th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here the total income determined in the original assessment order and the income that escaped assessment are clubbed together and assessed as the total income. In such a case, to reiterate, there is no question of any abatement of the earlier proceedings for the simple reason that no proceedings for assessment or reassessment were pending since they had already culminated in assessment or reassessment orders when the search was initiated or the requisition was made. 20. Applying the ratio of the above decisions to the facts of the present case, we find that there is no dispute that the original assessment for the A.Y. 2001-02 was completed u/s 143(3) on 13-2-2004 determining the total income at Rs. 26354942360/-. Thereafter, a search and seizure action was initiated in assessee's case by the Department on 2-7-2005 on which date the assessment for the A.Y. 2001-02 was not pending. Therefore, in view of the non- obstinate clause with which sub section (1) of section 153A opens, the A.O. has no jurisdiction to issue notice u/s 148 of the Act in respect of those six assessment years which falls within the exclusive jurisdiction of section 153A of the Act and accordingly the A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as questioned by the Revenue before the ITAT and the ITAT after discussing the cases of the parties and the relevant provisions in details has come to the conclusion that in the above situation, provisions of sec. 153C were applicable which excludes the application of sections 147 and 148 of the Act. The ITAT held the notice issued under sec. 148 and proceedings under sec. 147 as illegal and void ab initio. It was held that Assessing Officer having not followed procedure under sec. 153C, reassessment order was rightly quashed by the Learned CIT(Appeals). In the present case before us, it is an admitted fact, as also evident from the reasons recorded and the assessment order that the initiation of reopening proceedings was made by the Assessing Officer on the basis of information received from the Directorate of Income-tax (Inv.) on the basis of search seizure operation conducted at the premises of Rock Land Group of Cases and the documents related to the assessee found during the course of search were made available to the Assessing Officer of the present assessee. We thus respectfully following the decision of Co-ordinate Bench of the ITAT in the case of ACIT vs. Arun Kapur 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 153A then even if the purchase consideration is subsequently found to be incorrect or under stated it does not give jurisdiction to AO to resort to the provisions of section 147/148 of the Act after expiry of 4 years from the end of the assessment year. Further, reassessment proceedings were initiated by the AO on the premise that the assessee has not disclosed the purchase consider of the alleged land, however, it is pertinent to note that the assessee did not purchase any land as it remained with M/s Shri Kalyan Buildmart Pvt. Ltd. and there is no change of the ownership of the said land as belong to M/s Kalyan Buildmart Pvt. Ltd. We find that there is no transaction of sale and purchase of land in question between the assessee and Shri Madan Mohan Gupta. What was transferred by Shri Madan Mohan Gupta and his wife Smt. Shashi Kala Gupta were the shares of M/s Kalyan Buildmart Pvt. Ltd. which owned the land in question. There may be a case of under valuation of shares and understatement of consideration paid by the assessee however, it is not a case of purchase of land. The purchase consideration of shares was accepted by the AO while completing the assessment u/s 143(3) r.w. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf. We also cannot accept the submission of Mr. Jolly to the effect that only because in the assessment order, detailed reasons have not been recorded an analysis of the materials on the record by itself may justify the Assessing Officer to initiate a proceeding under section 147 of the Act. The said submission is fallacious. An order of assessment can be passed either in terms of sub-section (1) of section 143 or sub-section (3) of section 143. When a regular order of assessment is passed in terms of the said sub-section (3) of section 143 a presumption can be raised that such an order has been passed on application of mind. It is well known that a presumption can also be raised to the effect that in terms of clause (e) of section 114 of the Indian Evidence Act judicial and official acts have been regularly performed. If it be held that an order which has been passed purportedly without application of mind would itself confer jurisdiction upon the Assessing Officer to reopen the proceeding with out anything further, the same would amount to giving a premium to an authority exercising quasi-judicial function to take benefit of its own wrong. 17. The above said decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the formation of the belief. Our view gets support from the changes made to section 147 of the Act, as quoted hereinabove. Under the Direct Tax Laws (Amendment) Act, 1987, Parliament not only deleted the words reason to believe but also inserted the word opinion in section 147 of the Act. However, on receipt of representations from the companies against omission of the words reason to believe , Parliament reintroduced the said expression and deleted the word opinion on the ground that it would vest arbitrary powers in the Assessing Officer. We quote hereinbelow the relevant portion of Circular No. 549 dated October 31, 1989 ([1990] 182 ITR (St.) 1,29), which reads as follows : 7.2 Amendment made by the Amending Act, 1989, to reintroduce the expression 'reason to believe' in section 147. A number of representations were received against the omission of the words 'reason to believe' from section 147 and their substitution by the 'opinion' of the Assessing Officer. It was pointed out that the meaning of the expression, 'reason to believe' had been explained in a number of court rulings in the past and was well settled and its omission fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the power is invoked after the expiry of the period of four years from the end of the assessment year, a further pre-condition for such exercise is imposed by the proviso namely, that there has been a failure on the part of the assessee to make a return under section 139 or in response to a notice issued under section 142 or section 148 or failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for that assessment year. Unless, the condition in the proviso is satisfied, the Assessing Officer does not acquire jurisdiction to initiate any proceeding under section 147 of the Act after the expiry of four years from the end of the assessment year. Thus, in cases where the initiation of the proceedings is beyond the period of four years from the end of the assessment year, the Assessing Officer must necessarily record not only his reasonable belief that income has escaped assessment but also the default or failure committed by the assessee. Failure to do so would vitiate the notice and the entire proceedings. The relevant words in the proviso are, . . . . unless any income chargeable to tax has escaped assessment for such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sustained. As the error here is one of jurisdiction it is not necessary for the assessee to have recourse to the remedies by way of appeal, revision, etc. It is well settled that when a jurisdictional error is brought to the notice of this court such errors are capable of being corrected by this court in exercise of the court's powers under article 226 of the Constitution of India. The Supreme Court in the case of CIT v. Progressive Engineering [1993] 200 ITR 231 (sic), held that when all the relevant facts were before the court and the law is clear on the subject, it is the duty of the High Court to interfere. That was also a case where the proceedings were sought to be initiated against the assessee under section 147 of the Act. 20. In the case of ICICI Securities Ltd . v. Assistant Commissioner of Income Tax 3(2), Mumbai, the Bombay High Court vide order dated 22.08.2006 in W.P.No.1919 of 2006, while dealing with the issue on the reopening of assessment, held as follows: 7. In the facts of the present case, there is nothing new which has come to the notice of the revenue. The accounts had been furnished by the Petitioner when called upon. Thereafter the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the jurisdiction to reopen an assessment beyond a period of four years as spelt out in the proviso to Section 147 is that there ought to be a failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for that assessment year. In the present case, the sole basis on which the assessment proceedings were sought to be reopened is the order which has been passed on 5 July 2011 for Assessment Year 2007-08. In that order, according to the Revenue, it has been held that the assessee acts as a mere facilitator and is not a manufacturer so as to entitle it to the deduction under Section 10A. The issue, however, before the Court, is as to whether that can form the basis of the reopening of the assessment beyond a period of four years. The reasons which have been disclosed by the Assessing Officer do not set out as to what facts the assessee had failed to fully and truly disclose. Even a prima facie reference to the basis on which it is sought to be inferred that there was a failure to disclose all material facts has not been set out in the reasons. In that view of the matter, we are of the view that the primary jurisdictional requirement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dan Mohan Gupta. However, no tangible material is placed on record to support the action of the AO warranting reopening of the assessee s case. The AO did not rebut the appellant s contention that nothing over and above the amount recorded in the registered sale deeds was paid by bringing necessary details. The unsubstantiated material found in the diary in possession of Shri Madan Mohan Gupta cannot be considered in the hands of the assessee as a conclusive evidence so as to reopen the assessment and make additions towards unexplained investment in purchase of land. Undisputedly, no other material suggesting payment of higher amounts was recovered during the search. It is trite law that burden is on the revenue to prove that the price had been under stated and no addition is possible without any inquiry. In this case, there is no cogent material to support the reopening of the assessment within the meaning of section 147 and that the appellant has actually paid higher amount than that recorded in the registered sale deed and the AO did not conduct any inquiry to bring some material to corroborate the notings found in the diary allegedly contained dealings in respect of certain pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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