ISHRAT BEG,SITAPUR vs. INCOME TAX OFFICER, SITAPUR, SITAPUR

That the Learned Courts Below are not justified in treating the Deposits in Bank as Income from Other Sources. That the Learned Courts Below have also erred in not considering the legal and factual aspects of the case. That the Learned Courts Below are not justified in taking one view of the picture i.e. Credit side has been considered and no comment on the Debit side. That the CIT (Appeals) has also erred in not considering the finding of the Hon'able ITAT in similar case nor has categorically discussed on the Grounds of Appeal. That the findings of the Learned Courts Below are not valid, legal and proper. That relief as prayed may please be allowed and the Income Returned be accepted.”

The ld. AR at the outset submitted that the reopening u/s 148 of the Act is bad in law as the Assessing Officer has reopened the case u/s. 147/148 of the Act by taking cognizance of the deposits in the bank account. The ld. AR submitted that mere deposits in the bank account are not sufficient to hold that some income has escaped assessment. My attention was invited to judgment of the Delhi Tribunal in the case of Bir Bahadur Singh vs. ITO, 53 taxmann.com 366 wherein the Tribunal held that deposits in bank account may not be on account of some income and had quashed the assessment order by holding the reasons recorded were not sufficient to hold belief that income had escaped assessment. Therefore it was prayed that the assessment order passed u/s. 148 be quashed.

The ld. DR, on the other hand, submitted that on receipt of information that assessee had made certain deposits in the bank account the assessee was show caused to explain the deposits to which no reply was filed and nor anybody appeared on behalf of assessee and therefore there was no option left to the Assessing Officer other than to reopen the case and during reopening proceedings also nobody appeared and the Assessing Officer has passed order u/s. 144 r.w.s. 147 of the Act. Therefore, it was prayed that the legal issue taken by assessee is not sustainable as in this case, the assessee has not cooperated at all. The ld. AR in his rejoinder submitted that since the assessee was not served with the statutory notice, therefore, he was not obliged to file reply to such notice issued by Assessing Officer. 4. Hearing the arguments, I found that on receipt of information regarding deposits in bank, the assessee was show caused as to why his case be not reopened u/s. 147 of the Act to which nobody appeared nor filed any reply. The arguments of ld. AR that the assessee was not obliged to file any reply to a non statutory notice is of no force and therefore the first legal ground taken by the assessee is dismissed and it was conveyed in the open court itself. The ld. AR submitted that on merits also the assessee has a strong case. It was submitted