MADHUMALTI SHARMA,NOIDA vs. ITO, NOIDA

सुनवाई क� तार�ख/Date of Hearing : 25/04/2017 घोषणा क� तार�ख /Date of Pronouncement: 28/04/2017 ORDER This appeal of the assessee arises from the order of learned CIT(A)-I, NOIDA, vide order dated 31.08.2016 for the assessment year 2007-08. The assessee has raised the amended grounds of appeal as under: “1.Ground of Appeal No.-1: The A.C. has initiated proceedings u/s 147 on the basis of faulty and nonexistent reasons and grounds . The A.O. has opened the' case u/s 147 on the basis of reasons which never existed and made additions even after the objection of the assessee that the reasons for opening of the case do not exist. Hence the A.O. ceased power to assess the income u/ s 147 and his order needs to be quashed. 2.Ground of Appeal No.-2: Addition of Rs. 2,50,000/- on account of unexplained unsecured loan from the brother of the assessee Shri Ashish Bhardwaj That the Ld. Commissioner of Income Tax (Appeals) has erred in law and facts by confirming the addition of Rs. 2,50,000/- on account of unexplained unsecured loan. 3.Ground of Appeal No.-3: Addition of Rs. 98,500/- on account of unexplained expenditure: cash spent by the assessee to buy stamp papers That the Ld. Commissioner of Income Tax (Appeals) has erred in law and facts by confirming the addition of Rs. 98,500/- on account of unexplained expenditure.

Ground of Appeal No.-4: Addition of Rs. 1,15,000/- on account of unexplained unsecured loan from sister in law of the assessee Smt Gitanjali Bhardwaj That the Ld. Commissioner of Income Tax (Appeals) has erred in law and facts by confirming the addition of Rs. 1,15,000/- on account of unexplained unsecured loan.”

2. Learned counsel for the assessee argued the legal ground at the first instance and pointed out the reason recorded by the Assessing Officer at paper book 21 which is reproduced hereinbelow: Reasons for proceedings u/s. 147 of the IT Act, 1961 Dated : 30.03/2014 As per information under section 50C of the IT Act, 1961 received from the office the Commissioner of Income Tax, Noida it has been found that the assessee has sold property Rs.11,27,5001- on 02/08/2006 where as the sale consideration as per sec 50C of the property at Rs.16,04,000/-. In compliance to notice u/s. 133(6) of the I.T. Act 1961 dated 22/02/2013, assessee could not furnish any reply which proves that the assessee not adopted the sale value the property as per section 50C of the I.T. Act, 1961. Thus in view of the above, the assessee concealed the income of Rs. 4,76,500/- (16,04,000- 11,27,500/-). In absence of PA information regarding filling of the return for the A.Y. 2007-08 and the fact that the assessee declared capital gain in his return cannot be ascertained. Therefore, in view of the above, I have reason to believe that capital gain income of 4,76,500/- has escaped assessment for the assessment year 2007-08. To assess the same, proceedings u/s.147 of the I.T. Act 1961 are being initiated.”

3. The assessee has raised the objection to the reasons so recorded which are available at page 23 of the paper book. However, the Assessing Officer was not satisfied with the explanation of the assessee and rejected the submission of the assessee, therefore, the learned CIT(A) rejected the legal ground of the assessee.

4. I have heard the rival contentions and perused the facts of the case. It is not disputed that as per reasons recorded the Assessing Officer was of the view that assessee has sold the property and accordingly the assessee has not adopted the sale value of the property u/s.50C of the Act which is complete non application of mind since the assessee submitted the reply at page 2 dated 8.03.2013 that property was purchased and not sold. Also as per the objection to the reasons placed at page 23 of the paper book, the assessee has raised the objection on the same point. This is a complete non application of mind by the Assessing Officer while recording the reasons which in fact has been accepted by the Assessing Officer during the assessment proceedings. In such circumstances and facts of the case, the reasons so recorded are without any cogent material and there cannot be any reason to believe in the absence of material on record. The Assessing Officer does not acquire any jurisdiction to assess/re-assess u/s.147 of the Act and assessee/re-assess so made u/s.147 of the Act is directed to be quashed. Thus, the legal ground of the assessee is allowed.

5. Since the assessee succeeds on legal ground, therefore, the grounds on merit become academic in nature and do not require any adjudication.