Rajasthan High Court - Jaipur
Asstt. Cit vs L.N. Mehta on 9 July, 2002
Equivalent citations: (2002)76TTJ(NULL)594
ORDER
S.R. Chauhan, J.M. This appeal by revenue for assessment year 1981-82 is directed against the order of Deputy Commissioner (Appeals), Jodhpur, dated 18-12-1993.
2. We have heard the arguments of both the sides and also perused the records.
3. The revenue has raised the sole ground disputing the Deputy Commissioner (Appeals)'s order in cancelling the assessment made under section 147. The learned Departmental Representative of revenue has contended that though the income assessed in reassessment was less than Rs. 50,000, but that will not make the information with assessing officer to be for a belief of, escapement of income of less than Rs. 50,000. He has contended that in fact at the time of recording of reasons regarding income have escaped the assessing officer had estimated the escaped income at more than Rs. 50,000, so the initiation of proceedings under sections 148 and 147 was valid. He has supported the assessing officer's order. As against this the learned authorised representative of assessee has contended that the original assessment under section 143(3) was completed at an income of Rs. 16,000. He has contended that despite demand, the reasons were not supplied that the additions have been made on estimate basis. He has contended that after original assessment, the assessing officer had no further new material/evidence with him for reassessment, so initiation for the same was merely on the basis of suspicion and not on belief. He has relied on his written submission and following citations :
(a) ITO v. Smt. Chakka Bai (1986) 15 lTD 328 (Jp);
(b) Rashes Commission Corpn. v. Asstt. CIT (2001) 70 TTJ (Mum) 654;
(c) ITO v. Lakhmani Mewal Das (1976) 103 ITR 437 (SC);
(d) Indian Oil Corpn. v. ITO (1986) 159 ITR 956 (SC);
(e) Milan Supari Stores v. Asstt. CIT (1992) 194 ITR 72 (MP); and
(f) Tribunal's order dated 31-8-2000 passed in ITA Nos. 1022 to 1026/Jp/1993 [reported as ITO v. Mahesh Kumar Pandya (2001) 73 TTJ (Jd) 194Ed.] In the written submission of assessee, it has been contended that the assessing officer's belief that income escaping assessment was more than Rs. 50,000 was not well founded as is evident from the fact that the additions made were of Rs. 40,520 and the additions were of general nature based on discretion and estimate of assessing officer and the same were made in professional income on account of marriage expenses and deficit in cash flow. It has been contended that all facts pertaining to these issues were already within the knowledge of assessing officer while completing original assessment under section 143(3), and no new facts has come to his knowledge. It has been contended that these additions have been made by assessing officer estimating the income/expenditure on conjectures and surmises and by making hypothetical calculations, without there being any material.
4. In rejoinder, the learned Departmental Representative of revenue has contended that supplying of reasons to assessee is not essential.
5. We have considered the rival contentions, the relevant material on record as also the cited decisions. In 15 ITD 328 (supra), Jaipur Tribunal has held that at the time of initiation of proceedings Income Tax Officer must ensure that the amount of escapement of income is Rs. 50,000 or more, and the income, that is finally assessed, as such, should also be not less than Rs. 50,000. In (1986) 159 ITR 956 (SC) (supra), it has been held that to confer jurisdiction under section 147(a) to reopen assessment the Income Tax Officer must have reason to believe that escapement was due to assessee's failure to disclose fully and truly all material facts necessary for assessment of that year and there must be material for coming to the above conclusion. In (1960) 194 ITR 72 (MP) (supra), the reasons were not supplied to the assessee despite specific request, the Hon'ble High Court quashed the notice issued under section 148 for reassessment. In the Tribunal's order dated 31-8-2000, rendered in ITA Nos. 1022 to 1026/Jp/93 in the case of Mahesh Kumar Pandya (supra), it has been held that there must be some material/evidence on record to induce assessing officer to entertain belief as such of escapement of income as distinguished and mere 'suspicion' for the same. It has been held therein that when the information, to constitute reason for belief of escapement of income is general and non-specific, the same, in certain circumstances be examined in the context of ensuing assessment. In that view of the matter, considering all the facts and circumstances of the case, including the fact that the income assessed in reassessment is less than Rs. 50,000, we are of the view that the assessing officer did not have reasons to believe escapement of income of Rs. 50,000 or more and in turn, we find no fault with the conclusion drawn by learned Commissioner (Appeals) that the notice of reopening assessment issued by assessing officer under section 148 was barred by limitation of time [under section 149(1)(a)(ii)] due to seven years having lapsed from the end of assessment year 1981-82, and that the reassessment was, therefore, time-barred. As such we find the learned Commissioner (Appeals)'s impugned order to be quite justified, and so we make no interference therein.
6. In the result, this appeal of revenue is dismissed.