COMMISSIONER OF INCOME TAX Vs. JAYANT CHAKRAVARTY

JUDGEMENT

(1.) THIS is an application under S. 256 (2) of the IT Act, 1961. The Department has sought to raise the following question as a question of law:

(2.) THE proceedings relate to the asst. year 1976 77. In the return filed for the year, the assessee had shown his previous year as ending on October 31, 1975, in respect of income other than share income from Park West, a partnership firm, started on and from December 11, 1975. The assessee had formed the said partnership with some others on December 11, 1975, and had, by way of capital, contributed an immovable property being premises No. 5 6 Union Park, Pali Hill, Bandra, Bombay. The value of the said property was taken at Rs. 4,10,000. In the statement filed with the return, it was clarified that no income under the head " Capital gains" was shown as the asset brought by way of capital contribution did not amount to transfer of a capital asset. The assessment was completed on that basis.

(3.) THE ITO reopened the assessee's assessment for the asst. year 1976 77 under S. 148 r/w S. 147 (b). The reopening was challenged by the assessee. Reasons recorded by the ITO are noted in para. 7 of the Tribunal's appellate order. There is no reference to the order of the CIT (A) passed for the asst. year 1977 78 or to that of the Tribunal for that year in the reasons recorded. The reasons for the ITO's formation of belief that the assessee's income had escaped assessment is stated to be that the assessee's statement regarding previous year referred only to such sources the assessee had declared income from and that elucidation and clarification about it was actually given for the first time only before the appellate authority.