Sanjay Agrawal A Partnership Firm v. Additional Commissioner Of Income Tax Range-1, Raipurchhattisgarh.chhattisgarh

HIGH COURT OF CHHATTISGARH, BILASPUR Writ Petition (T) No. 141 of 2019Reserved on 27/11/2019 Delivered on 20/12/2019 Sanjay Agrawal A Partnership Firm, 35/36, 1st Floor, MilleniumPlaza, G. E. Road Raipur Through Partner Sanjay Agrawal S/oLate Ramavtar Agrawal, 57 Yrs R/o Chaubey Colony, RaipurChhattisgarh. ---- Petitioner Versus 1.Additional Commissioner Of Income Tax Range-1, RaipurChhattisgarh.Chhattisgarh. 2.Assistant Commissioner Of Income Tax Circle 1 (1), RaipurChhattisgarh.Chhattisgarh. ---- Respondents For Petitioner:Shri Sumit Nema, Sr. Advocate along with Shri Raja Sharma, Advocate. For Respondents:Smt. Naushina Ali, Shri Ajay Kumrani andShri Topilal Bareth, Advocates. Hon'ble Shri Justice P. Sam KoshyC.A.V. Order 1.Challenge in the present writ petition is the notice dated06.05.2019 issued by the Respondent No.3. Vide the said notice,the respondents have initiated proceedings for reassessment asper Section 147 of the Income Tax Act, 1961 (in short, the Act).06.05.2019 issued by the Respondent No.3. Vide the said notice,the respondents have initiated proceedings for reassessment asper Section 147 of the Income Tax Act, 1961 (in short, the Act). 2.Brief facts of the case is that, for the assessment year, 2015-16,the petitioner had submitted their return electronically on29.03.2016. However, subsequently, it is said that some surveywas conducted as per Section 133 (A) of the IT Act. In the courseof survey, the respondents found that there were manyincriminating materials and documents which were impounded. Inthe course of scrutiny, the Assessment Officer (in short, AO)the petitioner had submitted their return electronically on29.03.2016. However, subsequently, it is said that some surveywas conducted as per Section 133 (A) of the IT Act. In the courseof survey, the respondents found that there were manyincriminating materials and documents which were impounded. Inthe course of scrutiny, the Assessment Officer (in short, AO) assessed total income of the petitioner at Rs.4,23,99,241/- asagainst the returned income of Rs.2,53,93,897/-. It is for thisreason that notice under Section 148 of the Act was served uponthe petitioner. Thereafter, the petitioner vide letter dated05.06.2019 sought reasons from the respondents in respect of“Reasons to believe that some income of the assessee hasescaped assessment”. The Department later on provided thepetitioner with the reasons. 3.Thereafter, the petitioner raised objection against the decision ofreassessment. The objection so raised by the petitioner wasrejected by the AO vide communication dated 13.11.2019 givingintimation of the further proceeding with the matter. reassessment. The objection so raised by the petitioner wasrejected by the AO vide communication dated 13.11.2019 givingintimation of the further proceeding with the matter. 3.Thereafter, the petitioner raised objection against the decision ofreassessment. The objection so raised by the petitioner wasrejected by the AO vide communication dated 13.11.2019 givingintimation of the further proceeding with the matter. reassessment. The objection so raised by the petitioner wasrejected by the AO vide communication dated 13.11.2019 givingintimation of the further proceeding with the matter. 4.The petitioner primarily challenges the order on the ground thatnotice under Section 148 of the Act initiating reassessment isbarred by limitation and therefore, proceedings drawn is per seillegal. There was nothing which has been suppressed by thepetitioner at the time of the assessment. There was nothing whichthe petitioner had not made available to the department at the timeof submission of their return. Moreover, the documents which issaid to have used for the purpose of reassessment of the incomewere already available with the department, therefore, it cannot besaid that there was failure on the part of the petitioner in makingfull and true disclosure. Since there was no suppression nor wasthere any fresh material obtained by the department and the entiredocuments being already in possession of the department, theaction is bad in law. notice under Section 148 of the Act initiating reassessment isbarred by limitation and therefore, proceedings drawn is per seillegal. There was nothing which has been suppressed by thepetitioner at the time of the assessment. There was nothing whichthe petitioner had not made available to the department at the timeof submission of their return. Moreover, the documents which issaid to have used for the purpose of reassessment of the incomewere already available with the department, therefore, it cannot besaid that there was failure on the part of the petitioner in makingfull and true disclosure. Since there was no suppression nor wasthere any fresh material obtained by the department and the entiredocuments being already in possession of the department, theaction is bad in law. 5.Further contention of the petitioner is that, the reasons to believerecorded by the department again is baseless for the simplereason that there is no finding by the authorities as regards anysuppression of material facts during the course of scrutiny ofassessment under Section 143(iii) of the Act. It was furthercontended by the petitioner that law is also well settled that even ifthere is a change of opinion, the proceeding of reassessmentunder Section 147 of the Act could not have been initiated. recorded by the department again is baseless for the simplereason that there is no finding by the authorities as regards anysuppression of material facts during the course of scrutiny ofassessment under Section 143(iii) of the Act. It was furthercontended by the petitioner that law is also well settled that even ifthere is a change of opinion, the proceeding of reassessmentunder Section 147 of the Act could not have been initiated. 6.It was also contended that the reasons to believe provided by thedepartment are all vague, ambiguous and without any basis andthere being no tangible material to support the reasons to believe.There is also no objective finding or reasons given by theauthorities while giving reasons and also while rejecting theobjections preferred by the petitioner. department are all vague, ambiguous and without any basis andthere being no tangible material to support the reasons to believe.There is also no objective finding or reasons given by theauthorities while giving reasons and also while rejecting theobjections preferred by the petitioner. 6.It was also contended that the reasons to believe provided by thedepartment are all vague, ambiguous and without any basis andthere being no tangible material to support the reasons to believe.There is also no objective finding or reasons given by theauthorities while giving reasons and also while rejecting theobjections preferred by the petitioner. department are all vague, ambiguous and without any basis andthere being no tangible material to support the reasons to believe.There is also no objective finding or reasons given by theauthorities while giving reasons and also while rejecting theobjections preferred by the petitioner. 7.The counsel for the petitioner relied upon (2018) 404 ITR 0010Supreme Court in case of Income Tax Officer Vs. Taxman IndiaPvt. Ltd., in (2006) 283 ITR 212 in case of Taxman India Vs.Income Tax Officer passed by Delhi High Court, judgment ofBombay High Court in WP No. 546 of 2018 RajbhushanOmprakash Dixit Vs. Dy. Commissioner, Income Tax wherein ithas all been held that if the AO, for some reason, did not advert tosuch material or did not utilize the same, it cannot be said that theassessee failed to disclose truly and fully all material facts. Supreme Court in case of Income Tax Officer Vs. Taxman IndiaPvt. Ltd., in (2006) 283 ITR 212 in case of Taxman India Vs.Income Tax Officer passed by Delhi High Court, judgment ofBombay High Court in WP No. 546 of 2018 RajbhushanOmprakash Dixit Vs. Dy. Commissioner, Income Tax wherein ithas all been held that if the AO, for some reason, did not advert tosuch material or did not utilize the same, it cannot be said that theassessee failed to disclose truly and fully all material facts. 8.Another judgment following the same principle of law relied uponby the petitioner was WP No.1917 of 2019, Marico Ltd. Vs.Assistant Commissioner of Income Tax, decided by the Bombayby the petitioner was WP No.1917 of 2019, Marico Ltd. Vs.Assistant Commissioner of Income Tax, decided by the Bombay High Court. The petitioner also relied upon (1998) 229 ITR 0229 incase of Commissioner of Income Tax Vs. BanwarilalBanshidhar of the Allahabad High Court and (2009) 19 DTR0305 in case of Commissioner of Income Tax Vs. GKContractors to substantiate their contention that once when theAO have estimated on the basis of the higher profit ratesubsequent reliance on the books of account again and to holdthat there were yet certain income which has escaped assessmentis not sustainable. 9.According to the petitioner, the action of reassessment by therespondents is also in contravention to the principles of law laiddown by the Supreme Court in case of Commissioner of IncomeTax Vs. Kelvinator of India Ltd. (2010) 320 ITR 561 SC and forall the aforesaid reasons, the counsel for the petitioner prays forquashment of the notice under Section 148 of the Act holding it tobe barred by limitation. respondents is also in contravention to the principles of law laiddown by the Supreme Court in case of Commissioner of IncomeTax Vs. Kelvinator of India Ltd. (2010) 320 ITR 561 SC and forall the aforesaid reasons, the counsel for the petitioner prays forquashment of the notice under Section 148 of the Act holding it tobe barred by limitation. 9.According to the petitioner, the action of reassessment by therespondents is also in contravention to the principles of law laiddown by the Supreme Court in case of Commissioner of IncomeTax Vs. Kelvinator of India Ltd. (2010) 320 ITR 561 SC and forall the aforesaid reasons, the counsel for the petitioner prays forquashment of the notice under Section 148 of the Act holding it tobe barred by limitation. respondents is also in contravention to the principles of law laiddown by the Supreme Court in case of Commissioner of IncomeTax Vs. Kelvinator of India Ltd. (2010) 320 ITR 561 SC and forall the aforesaid reasons, the counsel for the petitioner prays forquashment of the notice under Section 148 of the Act holding it tobe barred by limitation. 10.Per contra, the counsel for the department opposing the petitionsubmitted that a plain perusal of the reasons to believe providedby the department to the petitioner it would clearly reveal that therewas sufficient tangible material found out in the course of scrutinywhich has led to the initiation of the proceeding under Section 147of the Act. According to the department, in the course of scrutiny ithas been found that there has been payment by way of cashtransaction of an amount of more than Rs. 87 Lakhs and wherethe transaction made were in cash exceeding Rs.20,000/- in a dayon the same person which is otherwise not allowed under Section40(A)(iii) of the Act. It is this transaction made in cash transactionsubmitted that a plain perusal of the reasons to believe providedby the department to the petitioner it would clearly reveal that therewas sufficient tangible material found out in the course of scrutinywhich has led to the initiation of the proceeding under Section 147of the Act. According to the department, in the course of scrutiny ithas been found that there has been payment by way of cashtransaction of an amount of more than Rs. 87 Lakhs and wherethe transaction made were in cash exceeding Rs.20,000/- in a dayon the same person which is otherwise not allowed under Section40(A)(iii) of the Act. It is this transaction made in cash transaction of an amount of more than Rs. 87 Lakhs which has escapedassessment and which were detected only in the course ofscrutiny and thereafter the proceeding has been initiated. 11.The counsel for the Department referred to Annexure P/6 whereinin the course of providing reasons to believe, it has been reflectedthat there were various cash payments made by the petitioner.What is also apparent and surprising is that a large number ofcash payments have been made showing payments of bribe/illegalgratification to the officers in the PWD department and suchpayments made from unexplained source are not reflected in thebooks of account, which led to such income escaping assessmentand which has necesiated issuance of the order of reassessment.According to the counsel for the department, all these facts aresufficient to draw a prima facie strong case of the assessee notdisclosing full and true material during the regular assessment. in the course of providing reasons to believe, it has been reflectedthat there were various cash payments made by the petitioner.What is also apparent and surprising is that a large number ofcash payments have been made showing payments of bribe/illegalgratification to the officers in the PWD department and suchpayments made from unexplained source are not reflected in thebooks of account, which led to such income escaping assessmentand which has necesiated issuance of the order of reassessment.According to the counsel for the department, all these facts aresufficient to draw a prima facie strong case of the assessee notdisclosing full and true material during the regular assessment. 12.The counsel for the respondents relied upon the judgments passedin the case of “M/s. Phool Chand Bajrang Lal and Another v.Income Tax Officer and Another”1993(4)SCC 77, “Income TaxOfficer, Jodhpur v. Purushottam Das Bangur and Another”1997(3)SCC 253, “Income Tax Officer, Calcutta v. SelectedDalurband Coal Co. Pvt. Ltd.” 1997(10)SCC 68, “AssistantCommissioner of Income Tax v. Rajesh Jhaveri Stock BrokersPrivate Limited” 2008 (14) SCC 208,and“DeputyCommissioner of Income Tax and Another v. Zuari EstateDevelopment and Investment Company Limited” 2015(15)SCC 248.in the case of “M/s. Phool Chand Bajrang Lal and Another v.Income Tax Officer and Another”1993(4)SCC 77, “Income TaxOfficer, Jodhpur v. Purushottam Das Bangur and Another”1997(3)SCC 253, “Income Tax Officer, Calcutta v. SelectedDalurband Coal Co. Pvt. Ltd.” 1997(10)SCC 68, “AssistantCommissioner of Income Tax v. Rajesh Jhaveri Stock BrokersPrivate Limited” 2008 (14) SCC 208,and“DeputyCommissioner of Income Tax and Another v. Zuari EstateDevelopment and Investment Company Limited” 2015(15)SCC 248. 13.Given the said facts, now if we come to the findings of theAssessing Officer or the reasons recorded by the AssessingOfficer, it would clearly reveal that as per the Assessing Officer, anamount of more than Rs.87 Lakhs has escaped assessment andthat this amount of more than Rs.87 Lakhs were payments madein cash towards expenditure exceeding more than Rs.20,000/- in aday, which otherwise is impermissible under the I.T. Act. The saidreasons were thereafter placed before the Principal Commissioner,who in turn has given sanction for the same. Assessing Officer or the reasons recorded by the AssessingOfficer, it would clearly reveal that as per the Assessing Officer, anamount of more than Rs.87 Lakhs has escaped assessment andthat this amount of more than Rs.87 Lakhs were payments madein cash towards expenditure exceeding more than Rs.20,000/- in aday, which otherwise is impermissible under the I.T. Act. The saidreasons were thereafter placed before the Principal Commissioner,who in turn has given sanction for the same. 14.From the plain reading of the aforesaid provision of law, what isclearly reflected is that there has to be subjective satisfaction ofthe officer concerned to the reasons assigned by the AssessingOfficer. clearly reflected is that there has to be subjective satisfaction ofthe officer concerned to the reasons assigned by the AssessingOfficer. 14.From the plain reading of the aforesaid provision of law, what isclearly reflected is that there has to be subjective satisfaction ofthe officer concerned to the reasons assigned by the AssessingOfficer. clearly reflected is that there has to be subjective satisfaction ofthe officer concerned to the reasons assigned by the AssessingOfficer. 15.A plain reading of Section 147 of the Act, what stands revealed isthat, the requirement for reopening of assessment is of theAssessing Officer finding “Any income chargeable to Tax”having escaped assessment. The term any income, in the opinionof this court, would also include the informations provided by theassessee to the department and it could also be an information notsubmitted by the assessee, or had suppressed it. Nowhere underthe provisions of Section 147, either in the main section nor underthe proviso clause, so also neither under the explanationsprovided under this section, is there a bar for the department toinitiate reassessment if the documents/records has already beensubmitted to the department at the time of assessment beingmade. Neither does the said provision anywhere envisages thatonce if the books of account has been scrutinized, the samethat, the requirement for reopening of assessment is of theAssessing Officer finding “Any income chargeable to Tax”having escaped assessment. The term any income, in the opinionof this court, would also include the informations provided by theassessee to the department and it could also be an information notsubmitted by the assessee, or had suppressed it. Nowhere underthe provisions of Section 147, either in the main section nor underthe proviso clause, so also neither under the explanationsprovided under this section, is there a bar for the department toinitiate reassessment if the documents/records has already beensubmitted to the department at the time of assessment beingmade. Neither does the said provision anywhere envisages thatonce if the books of account has been scrutinized, the same cannot be scrutinized again for the purpose of initiating aproceeding under Section 147 of the Act. The documents havingbeen submitted to the Assessing Officer at the first instance andthe Assessing Officer having skipped/missed the said transactionfrom being assessed or having been overlooked, the same wouldnot bar the department from initiating proceedings under Section147 of the Act in case if the department finds at a later stagecertain transaction which have escaped assessment. 16.The only condition which is required under Section 147 of the Actfor reopening assessment is that, the Assessing Officer shouldhave reasons to believe that certain income chargeable to tax hadescaped assessment. Such belief has to be to the subjectivesatisfaction of the Assessing Officer and the Act does not prescribea precondition of the material not having been disclosed in thecourse of assessment at the first instance.for reopening assessment is that, the Assessing Officer shouldhave reasons to believe that certain income chargeable to tax hadescaped assessment. Such belief has to be to the subjectivesatisfaction of the Assessing Officer and the Act does not prescribea precondition of the material not having been disclosed in thecourse of assessment at the first instance. 16.The only condition which is required under Section 147 of the Actfor reopening assessment is that, the Assessing Officer shouldhave reasons to believe that certain income chargeable to tax hadescaped assessment. Such belief has to be to the subjectivesatisfaction of the Assessing Officer and the Act does not prescribea precondition of the material not having been disclosed in thecourse of assessment at the first instance.for reopening assessment is that, the Assessing Officer shouldhave reasons to believe that certain income chargeable to tax hadescaped assessment. Such belief has to be to the subjectivesatisfaction of the Assessing Officer and the Act does not prescribea precondition of the material not having been disclosed in thecourse of assessment at the first instance. 17.The overall reading of Section 147 of the Act would show that widepowers have been given upon the Assessing Officer to reach tothe conclusion of there being sufficient reasons to believe thatincome chargeable to tax had escaped assessment. It could evencover cases where assessee has fully disclosed the material facts.This view of the court stands fortified from the Division Benchjudgment of Punjab & Haryana High Court in case of JawandSons Vs. Commissioner of Income Tax (2010) 195 Taxman144. The Division Bench of Delhi High Court in case ofConsolidated Photo and Finvest Ltd. Vs. AssistantCommissioner of Income Tax(2006) 281 ITR 394, has also heldthat action under Section 147 of the Act was permissible even ifpowers have been given upon the Assessing Officer to reach tothe conclusion of there being sufficient reasons to believe thatincome chargeable to tax had escaped assessment. It could evencover cases where assessee has fully disclosed the material facts.This view of the court stands fortified from the Division Benchjudgment of Punjab & Haryana High Court in case of JawandSons Vs. Commissioner of Income Tax (2010) 195 Taxman144. The Division Bench of Delhi High Court in case ofConsolidated Photo and Finvest Ltd. Vs. AssistantCommissioner of Income Tax(2006) 281 ITR 394, has also heldthat action under Section 147 of the Act was permissible even if the Assessing Officer gathered his reasons to believe from thesame record as had been the subject matter of the completedassessment proceedings. Mere production of books of account isnot sufficient to infer that there had been full disclosure of materialfacts necessary for the purpose of assessment. Once, if in theopinion of the Assessing Officer, there are reasons to believe ofcertain income escaping assessment, it would be sufficient forinitiating proceedings under Section 147 of the Act. 18.In case of M/s Phool Chand Bajrang Lal & Anr. Vs. Income TaxOfficer and Another, 1993(4)SCC 77, the Supreme Court inparagraph 6, 26 and 27 held as under: “6. From the plain phraseology of the above Sections of the Act, itappears that two conditions precedent which are required to besatisfied before an Income Tax Officer can acquire jurisdiction toproceed under Clause (a) of Section 147 read with Sections 148 and149 of the Act, beyond the period of four years but within a period ofeight years, from the end of the relevant year, are: (a) that the IncomeTax Officer must have reason to believe that the income, profits or gainschargeable to tax had either been under assessed or escapedassessment and (b) that the ITO must have reason to believe that suchescapement or under-assessment was occasioned by reason, ofomission or failure on the part of the assessee to disclose fully and trulyall material facts necessary for the assessment. Both these conditionsmust co-exist in order to confer jurisdiction on the Income Tax Officer.The Income Tax Officer is obliged, before initiating proceedings underSection 148 of the Act to record the reasons for the formation of hisbelief to reopen the assessment. 26. We are not persuaded to accept the argument of Mr. Sharma thatthe question regarding truthfulness or falsehood of the transactionsreflected in the return can only be examined during the originalassessment proceedings and not at any stage subsequent thereto. Theargument is too broad and general in nature and does violence to theplain phraseology of Sections 147(a) and 148 of the Act and is againstthe settled law by this Court. We have to look to the purpose and intentof the provisions. One of the purposes of Section 147, appears to us to be, to ensure that a party cannot get away by wilfully making a false oruntrue statement at the time of original assessment and when thatfalsity comes to notice, to turn around and say "you accepted my lie,now your hands are tied and you can do nothing". It would be travestyof justice to allow the assessee that latitude. 27. In our opinion, therefore, in the facts of the present case theIncome-tax Officer Azamgarh rightly initiated the reassessmentproceedings on the basis of subsequent information, which was specificrelevant and reliable, and after recording the reasons for formation ofhis own belief that in the original assessment proceedings, theassessee had not disclosed the material facts truly and fully andtherefore income chargeable to tax had escaped assessment. He,therefore, correctly invoked the provisions of Sections 147(a) and 148of the Act. The High Court was, thus, perfectly justified in dismissing thewrit petition. There is no merit in this appeal which fails and isdismissed but with no order as to costs.” 19.Again in case of Income Tax Officer, Calcutta Vs. M/s Selected Dalurband Coal Co. Pvt. Ltd. 1997(10)SCC 68, in paragraph 3held as under: “3.It is well settled by various decisions of this Court that the noticeunder Section 148 read with Section 147 can be issued only where theIncome- tax Officer has reason to believe that the income profits orgains chargeable to tax had been under-assessed or escapedassessment and further that such escapement or under assessmentwas occasioned by reason of the failure of the assessee to disclosefully and truly all material facts necessary for the assessment of thatyear. (We are not concerned with Clause (b) of Section 147 here butonly with Clause (a). In other words, there must be relevant materialbefore the assessing officer upon which he must reasonably andrationally form the requisite opinion (belief). The question, therefore, iswhether the letter of the Chief Mining Officer aforesaid does notconstitute relevant material upon which the Income-tax Officer couldhave formed the requisite belief? It must be remembered that theformation of belief by the Income-tax Officer is essentially within hissubjective satisfaction.” 20.The aforesaid principles are still holding good and has been againreiterated by the Supreme Court in case of AssistantCommissioner of Income Tax Vs. Rajesh Jhaveri Stock Brokers Pvt. Ltd. 2008(14)SCC 208, wherein in paragraph 19,20and 21 held as under: “19. Section 147 authorises and permits the Assessing Officer toassess or reassess income chargeable to tax if he has reason tobelieve that income for any assessment year has escaped assessment.The word reason in the phrase reason to believe would mean cause orjustification. If the Assessing Officer has cause or justification to knowor suppose that income had escaped assessment, it can be said tohave reason to believe that an income had escaped assessment. Theexpression cannot be read to mean that the Assessing Officer shouldhave finally ascertained the fact by legal evidence or conclusion. Thefunction of the Assessing Officer is to administer the statute withsolicitude for the public exchequer with an inbuilt idea of fairness totaxpayers. “19. Section 147 authorises and permits the Assessing Officer toassess or reassess income chargeable to tax if he has reason tobelieve that income for any assessment year has escaped assessment.The word reason in the phrase reason to believe would mean cause orjustification. If the Assessing Officer has cause or justification to knowor suppose that income had escaped assessment, it can be said tohave reason to believe that an income had escaped assessment. Theexpression cannot be read to mean that the Assessing Officer shouldhave finally ascertained the fact by legal evidence or conclusion. Thefunction of the Assessing Officer is to administer the statute withsolicitude for the public exchequer with an inbuilt idea of fairness totaxpayers. 20. As observed by the Delhi High Court in Central ProvincesManganese Ore Co. Ltd. v. ITO [1991 (191) ITR 662], for initiation ofaction under section 147(a) (as the provision stood at the relevant time)fulfillment of the two requisite conditions in that regard is essential. Atthat stage, the final outcome of the proceeding is not relevant. In otherwords, at the initiation stage, what is required is reason to believe, butnot the established fact of escapement of income. At the stage of issueof notice, the only question is whether there was relevant material onwhich a reasonable person could have formed a requisite belief.Whether the materials would conclusively prove the escapement is notthe concern at that stage. This is so because the formation of belief bythe Assessing Officer is within the realm of subjective satisfaction (seeITO v. Selected Dalurband Coal Co. Pvt. Ltd. [1996 (217) ITR 597(SC)]; Raymond Woollen Mills Ltd. v. ITO [ 1999 (236) ITR 34 (SC)]. 21. The scope and effect of section 147 as substituted with effect fromApril 1, 1989, as also sections 148 to 152 are substantially differentfrom the provisions as they stood prior to such substitution. Under theold provisions of section 147, separate clauses (a) and (b) laid downthe circumstances under which income escaping assessment for thepast assessment years could be assessed or reassessed. To conferjurisdiction under section 147(a) two conditions were required to besatisfied firstly the Assessing Officer must have reason to believe thatincome profits or gains chargeable to income tax have escapedassessment, and secondly he must also have reason to believe thatsuch escapement has occurred by reason of either (i) omission orfailure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. Both these conditionswere conditions precedent to be satisfied before the Assessing Officercould have jurisdiction to issue notice under section 148 read withsection 147(a) But under the substituted section 147 existence of onlythe first condition suffices. In other words if the Assessing Officer forwhatever reason has reason to believe that income has escapedassessment it confers jurisdiction to reopen the assessment. It ishowever to be noted that both the conditions must be fulfilled if the casefalls within the ambit of the proviso to section 147. The case at hand iscovered by the main provision and not the proviso.”were conditions precedent to be satisfied before the Assessing Officercould have jurisdiction to issue notice under section 148 read withsection 147(a) But under the substituted section 147 existence of onlythe first condition suffices. In other words if the Assessing Officer forwhatever reason has reason to believe that income has escapedassessment it confers jurisdiction to reopen the assessment. It ishowever to be noted that both the conditions must be fulfilled if the casefalls within the ambit of the proviso to section 147. The case at hand iscovered by the main provision and not the proviso.” 21.Recently a similar issue came up before this court in WPT No.234of 2018 and other connected writ petitions of similar naturewherein referring to various judgments on the field and relyingupon the analogy laid down in the judgments referred in thepreceding paragraphs, this court had dismissed the writ petitions.The said judgment of Single Bench was subsequently subjected tochallenge in Writ Appeal also being WA No.336 of 2019 and theDivision Bench on 29.07.2019 dismissed the Writ Appeal affirmingthe order passed by the Single Bench. of 2018 and other connected writ petitions of similar naturewherein referring to various judgments on the field and relyingupon the analogy laid down in the judgments referred in thepreceding paragraphs, this court had dismissed the writ petitions.The said judgment of Single Bench was subsequently subjected tochallenge in Writ Appeal also being WA No.336 of 2019 and theDivision Bench on 29.07.2019 dismissed the Writ Appeal affirmingthe order passed by the Single Bench. 22.The phrase “Reasons to Believe” does not mean that theAssessing Officer should have ascertained the facts by legalevidence. All that is required is that, the Assessing Officer shouldprima facie have some material on the basis of which there shouldbe reasons to believe of certain incomes chargeable to taxescaping assessment. There need not be any concrete evidenceor proof available for coming to a final conclusion. It is only aninitiation of proceedings of reassessment where the assessee getsa chance to put forth their defence, explanation and justificationwhich would further be scrutinized by the Assessing Officer whilereaching to the final conclusion. One should not loose sight of theAssessing Officer should have ascertained the facts by legalevidence. All that is required is that, the Assessing Officer shouldprima facie have some material on the basis of which there shouldbe reasons to believe of certain incomes chargeable to taxescaping assessment. There need not be any concrete evidenceor proof available for coming to a final conclusion. It is only aninitiation of proceedings of reassessment where the assessee getsa chance to put forth their defence, explanation and justificationwhich would further be scrutinized by the Assessing Officer whilereaching to the final conclusion. One should not loose sight of the fact that the final assessment on the conclusion of a proceedingsunder Section 147 of the Act is also an appealable order whereinalso the assessee has a right to agitate or challenge the orderpassed by the Assessing Officer on a proceeding under Section147 of the Act. 23.In view of the aforesaid provisions of law, if we look into theproceedings under challenge, it would clearly reveal that there aresufficient reasons given by the Assessing Officer, which accordingto him is “Reasons to believe” of an income of more than Rs.87Lakhs, which are chargeable to tax has escaped assessment andwhich has come to the notice of Department at a later stage in thecourse of scrutiny.proceedings under challenge, it would clearly reveal that there aresufficient reasons given by the Assessing Officer, which accordingto him is “Reasons to believe” of an income of more than Rs.87Lakhs, which are chargeable to tax has escaped assessment andwhich has come to the notice of Department at a later stage in thecourse of scrutiny. 23.In view of the aforesaid provisions of law, if we look into theproceedings under challenge, it would clearly reveal that there aresufficient reasons given by the Assessing Officer, which accordingto him is “Reasons to believe” of an income of more than Rs.87Lakhs, which are chargeable to tax has escaped assessment andwhich has come to the notice of Department at a later stage in thecourse of scrutiny.proceedings under challenge, it would clearly reveal that there aresufficient reasons given by the Assessing Officer, which accordingto him is “Reasons to believe” of an income of more than Rs.87Lakhs, which are chargeable to tax has escaped assessment andwhich has come to the notice of Department at a later stage in thecourse of scrutiny. 24.Given the said facts and circumstances of the case, this Court hasno hesitation to reach to the conclusion that there was sufficientmaterial available before the authority concerned for initiating aproceeding under Section 147 of the I.T. Act and the same cannotbe held to be bad in law as the proceedings drawn by theAssessing Officer seems to be with sufficient material in recordshowing income, which otherwise is chargeable to tax havingescaped assessment. no hesitation to reach to the conclusion that there was sufficientmaterial available before the authority concerned for initiating aproceeding under Section 147 of the I.T. Act and the same cannotbe held to be bad in law as the proceedings drawn by theAssessing Officer seems to be with sufficient material in recordshowing income, which otherwise is chargeable to tax havingescaped assessment. 25.For the aforesaid reasons, the writ petition fails and is accordinglydismissed. dismissed. Sd/-(P. Sam Koshy)Judge