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आदेश/Order
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the assessee against the order dated 01.07.2019 of the Commissioner of Income Tax (Appeals), Patiala [hereinafter referred to as ‘CIT(A)’]
2. The assessee in this appeal has taken following grounds of appeal:-
1. That on the facts, circumstances and legal position of the case, the Worthy CIT(A) in Appeal No. 10257/IT/CIT(A)/PTA/18-19 has erred in passing that -Chd/2010- Shri Arun Kaushal, Patiala 2 order in contravention of the provisions of S. 250(6) of the Income Tax Act, 1961.
That on law, facts and circumstances of the case, the impugned assessment proceedings deserves to be quashed since the same lacks jurisdictional requirement u/s 148 r.w.s. 147 of the Act.
That on law, facts and circumstances of the case, the Worthy CIT(A) has erred in confirming the action of Ld. AO in making addition of Rs. 2,37,127/- on account of sale of a plot measuring 280 sq. Yards in Village Choura even when the said plot was never actually sold by the appellant.
That on law, facts and circumstances of the case, the Worthy CIT(A) has erred in confirming the action of Ld. AO in making addition on the basis of sale of plot even when the sale deed was executed via a fraudulent GPA without the knowledge of appellant.
5. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.
3. Ground Nos. 1 : Ground No.1 is general in nature and does not need any specific adjudication.
4. Ground No.2 : At the outset, the Ld. Counsel for the assessee has brought our attention to the reasons recorded by the Assessing Officer for reopening of the assessment which reads as under:-
“Name of the assessee : Sh. Arun Kaushal, S/o Sh. Som Nath Kaushal, # 9-B, Gaii No.5, Hira Bagh Colony, Opp Pbi. University, Patiala.
Assessment year: 2012-13 PAN : ALFPK2743Q7430 Status : Indl. -Chd/2010- Shri Arun Kaushal, Patiala 3 Brief reasons for reopening the case U/s 148 of the Income-tax Act, 1961
As per the information on record, the assessee namely Sh. Arun Kaushal, S/o Sh. Som Nath Kaushal, R/o Hira Bagh Colony, Patiala has made huge transactions of immovable property during the F.Y. 2011-12 relevant to A.Y. 2012-13 . From the perusal of the record, it is found that the assessee has no capacity to make such a huge investment in the sale / purchase of the property. Therefore, 1 am satisfied that there is an escapement of Rs. 33,83,000/- in the hands of the assessee. 1, have, therefore, reasons to believe that an income of Rs. 33,83,000 /- has escaped assessment within the meaning of provision of explanation 2 (b) of section 147 of the Income-tax Act, 1961. Sd/- (Alipt Verma) Income Tax Officer, Ward-5, Patiala”
A perusal of the above recorded reasons reveal that the Assessing Officer had an information on record that the assessee has made huge transactions of immovable property during financial year 2011-12 and further from the perusal of the record the Assessing Officer found that the assessee had no capacity to make such huge investment . On the basis of the above information on record, the Assessing Officer was satisfied that there was an escapement of assessment of income of Rs. 33,83,000/- at the hands of the assessee. However, a perusal of the assessment order reveals that there is no mention of any such record in the possession of the Assessing Officer nor there is any allegation of any investments made. There is no mention of even aforesaid amount of Rs. 33,83,000/- regarding which the Assessing Officer alleged in the reasons recorded of escapement of income.
Under the circumstances, the reasons recorded by the Assessing Officer were wrong and false and even there is not an iota in the -Chd/2010- Shri Arun Kaushal, Patiala 4 assessment order of any fact mentioned in the reasons recorded. Even in the reasons recorded, there is no mention as to from what record and about what investment, the Assessing Officer had information and how that information was related to the assessee and how the Assessing Officer came to the conclusion that the income of the assessee had escaped assessment. Under the circumstances it cannot be said that the Assessing Officer had any information from which he had reason to believe that the income of the assessee had escaped assessment. In this case, the reopening of the assessment is, thus, bad in law. In view of this, the re-assessment order passed by the Assessing Officer is not sustainable in the eyes of law and the same is hereby quashed.
Since we have already quashed the assessment order, therefore, there seems no necessity to deliberate upon the merits of the case regarding addition of Rs. 2,37,127/- in respect of some other transactions as the same is rendered academic in nature. In view of our findings given above, the impugned order of CIT(A) is set aside and the impugned additions stand deleted.
The appeal of the assessee stands allowed.
Order pronounced on 15.12.2020.