AKSHAR INFRASTRUCTURE PVT. LTD. Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) By way of this petition under Article226 of the Constitution of India the petitioner has prayed for an appropriate writ, order or direction to quash and set aside the impugned notice issued by the Assessing Officer under Sec. 148 of the Income Tax Act (hereinafter referred to as "the Act") by which the Assessing Officer has sought to reopen the assessment for the Assessment Year 2005-06 alleging inter alia that the income chargeable to tax has escaped assessment.

(2.) The facts leading to the present Special Civil Application in a nutshell are as under;

(3.) The assessee filed the return of income for the Assessment Year 2005-06. During the year under consideration, the assessee purchased one land at a price of Rs.78 lakhs. However, stamp authorities valued the same at Rs.1,85,05,800.00 and charged the stamp duty accordingly. In the scrutiny assessment under Sec. 143(3) of the Act the Assessing Officer added the difference of Rs.1,07,05,800.00 (Rs.1,85,05,800.00 - Rs.78,00,000.00) as deemed income, being unexplained under Sec. 69 of the Act. It appears that feeling aggrieved and dissatisfied with the scrutiny assessment under Sec. 143(3) of the Act the assessee preferred Appeal before the learned CIT(A). At this stage, it is required to be noted that during pendency of the scrutiny assessment, the Assessing Officer made Reference to the District Valuation Officer ('DVO" for short). However, as according to the revenue, time limit to frame the scrutiny assessment was to over, the Assessing Officer without waiting for the DVO's report finalised the scrutiny assessment under Sec. 143(3) of the Act and added Rs.1,07,05,800.00 as deemed income, being unexplained investment, under Sec. 69 of the Act. As observed herein above, against the scrutiny assessment under Sec. 143(3) of the Act the asssesse preferred Appeal before the learned CIT(A). In the meantime, the Assessing Officer received the DVO's report valuing the property at Rs. 4,43,83,000.00 by letter dated 5/10/2008 and letter dated 29/09/2009. Before the learned CIT(A) the Assessing Officer requested to enhance the deemed income on the basis of the DVO's report. However, relying upon its earlier decision in the case of Balkishan Poddar rendered in ITA No.3412, 3413 and 3414/Ahd/2008 dated 12/06/2009,learned CIT(A) has specifically observed that no addition can be sustained based on either stamp duty valuation or the valuation report of the DVO, and therefore, the learned CIT(A) rejected the prayer of the Assessing Officer to make the addition on the basis of the DVO's report. Thereafter, the Assessing Officer issued the impugned notice under Sec. 148 of the Act dated 09/10/2009 to reopen the assessment for the Assessment Year 2005-06 stating that the income had escaped the assessment and asked the assessee to file the return. By letter dated 27/11/2009 the assessee asked for the reasons recorded. Thereafter, the Assessing Officer has furnished /supplied the reasons recorded to reopen the assessment for the Assessment Year 2005-06. The reasons to reopen the assessment for the Assessment Year 2005-06 reads as under;