SMT. PRAMILA PATRA,CUTTACK vs. ITO WAED -1 (1), CUTTACK

Shri Saswat Acharya and Shri Abhijeet Agarwal, ld ARs appeared for the assessee and Shri S.C.Mohanty, Sr. DR appeared for the revenue.

It was submitted by ld AR tht the case has been reopened within a period of 4 years from the end of the relevant previous year, thus the approval was obtained from JCIT, Range-1, Cuttack. However, there were specific reasons recorded before initiating the proceedings u/s.148 of the Act For this, he placed reliance on the copy of the order sheet available on record. Further, according to ld AR no enquiry/investigation was carried out and the ITO simply proceeded with the half hazard information stated to have been received from DDIT (Inv) Unit -2, Bhubaneswar. It was submitted by ld AR that the sanction/approval by the JCIT, Range-1, Cuttack in respect of reasons recorded were un-substantiable insofar as there was no reasons recorded and there was no information on the basis of which, the reopening could have been done.

In reply, ld Sr DR has placed before us the copy of the order sheet entries which are as follows:

It was the submission by ld AR the order sheet entry on 28.3.2016 as extracted above is the reasons recorded. He also placed before us the copy of the approval alongwith proposals, which reads as follows:

It was the submission that the JCIT, Range-1, Cuttack has categorically mentioned that he is satisfied with the reasons recorded by the Assessing Officer for issuance of notice u/s.148 of the Act. He further drew our attention to the information referred to as the basis for the reasons recorded, which were at pages 14 to 18 of paper book, as follows“

It was the submission that this was the information on the basis of which, reopening has been initiated. It was the submission that in pages 14

At this point, ld Sr DR was specifically asked as to whether there is any other documents or records other than that what is mentioned in the order sheet recording for the purpose of showing the reasons recorded. Ld Sr DR specifically submitted that there is no other document other than this. It was the submission that the order sheet entry dtd.28.3.2016 itself is the reasons which have been validly recorded and requisite approval has also been obtained. It was the submission that the reassessment proceedings were validly initiated. It was further submitted that the assessee has been non-cooperative in the assessment proceedings.

We have considered the rival submissions. One of the primary requirements for reopening is the recording of reasons. The reasons are to be live and it should specify the probable escapement of income. It need not be the exact figure. There should be some figure. There should be some information as to how the Assessing officer has come to the conclusion that there is escapement of income either in the form of some investigation or enquiry or documentation or wrong interpretation of law. A perusal of the reasons recorded in the present case clearly shows that the P a g e 9 | 15

Coming to the approval granted as mentioned earlier, the reasons recorded are devoid of any information. The alleged documents on the basis of which the reasons have been recorded are also devoid of any connection and that the JCIT, Range-1, Cuttack has mentioned that he is satisfied with the reasons recorded by the Assessing Officer for issuance of notice u/s.148 of the Act. What is the basis for which the satisfaction has been recorded by the JCIT, Range-1, Cuttack is also not known. Another interesting aspect of the whole episode is the second page of the approval, which is the letter to the JCIT, Range-1, Cuttack by ITO, Ward -1(1), Cuttack. There is no reference to any records but it is stated that he is submitting the proposal for initiation of proceedings u/s.148 of the Act for the following cases for your kind perusal and necessary approval. This contains seven names totaling 21 assessment years. All have been provided on the same date and surprisingly at page 31 of PB, the JCIT Range-1, Cuttack has returned the satisfaction approval on the very same day i.e. on 28.3.2016 wherein, there is not even a change in the Sl.No. and seven persons in the same seriatim, 21 files are returned and this time alongwith assessment records. The copy of the letter dated 28.3.2016

Thus, the Assessing Officer has received information from the DDIT (Inv), Unit -2(1), Bhubaneswar, records his findings without even making any enquiry /investigation at his end for reopening of assessment on 28.3.2016 in the order sheet, send the files to JCIT, Range- 1, Cuttack for approval. JCIT, Range-1, Cuttack goes through the records and satisfaction and approval for reopening on 28.3.2016 and the files are returned to the ITO, Ward -1(1) Cuttack for the purpose of issuing notice u/s.148 of the Act on 28.3.2016 but the notice u/s.148 is issued on 28.3.2016 served on the assessee on 31.3.2016. Thus, clearly the reasons recorded and the satisfaction being unsustainable, especially in view of the principles laid down by the Hon’ble Jurisdictional High Court in the case of M/s. Serajuddin & Co. Kolkata in & 45 of 2022 order dated 15.3.2023,(150 taxmann.com 146)(Odisha) which has also been approved by Hon’ble Supreme Court in SLP No.44989/2023 dated 28.11.2023, notice issued u/s.148 stands quashed and consequential assessment also stands quashed for both the assessment years.

In the result, both the appeals of the assessee stand allowed. to 115/CTK/2023: Trilochan Patra

These appeals of the assessee are directed against the separate orders of ld CIT(A) dated 6.2.2023 for the assessment years 2009 -10 to 2014-15 , respectively.

On identical issue, in our order of even date, we have quashed the reassessment in the case of Mrs Pramila Patra, wife of the assessee in & 22/CTK/2022. As the facts are same and the assessment has been reopened on the basis of same reasons, following our decisions as above, we quash the notice issued u/s.148 of the Act and consequential reassessments made in the case of the assessee, i.e. Trilochan Patra.

In the result, all the appeals of the assessee stand allowed.