The Tax Publishers2013 TaxPub(DT) 0049 (All-HC) : (2012) 254 CTR 0010 : (2012) 078 DTR 0100

INCOME TAX ACT, 1961

--Reopening of assessment--reason to believe escapement Report of DVO aloneAssessing officer cannot reopen assessment merely on the basis of report of DVO even if DVO's report is based on some tangible material. Assessing officer relied mainly on DVO's report without pointing on any defect or discrepancy or material defect in books of accounts. <b.Held: ,/i>Reopening was not justified, more so since expenditures incurred were duly supported by bills and vouchers. Held: In the present case the Tribunal found that the DVO's report is based on his opinion, and not on any material, which could form the basis of reopening of the cases, and thus it can at best be treated as an information, which will not be sufficient material for recording 'reason to believe' to proceed in the matter. The opinion of the DVO per se is not an information for the purposes of reopening assessment under section 147 of the Income Tax Act, 1961. The assessing officer has to apply his mind to the material, if any, collected and must form a belief thereon. There has to be something more than the report of DVO for the belief of the assessing officer. The assessing officer cannot, merely on the basis of DVO's report, reopen the assessment. The DVO's report may be based only on his opinion or on some tangible material. In this case assessing officer has relied mainly on the report of the DVO without pointing out any defect or discrepancy much less any material defect in the books of accounts of the assessee, and the expenditures incurred by the assessee in construction and shown in the books of accounts are duly supported by bills and vouchers.'--Asstt. CIT v. Dhariya Construction Co. rendered on 16-2-2010 (supra).

Income Tax Act, 1961 Section 147

In the Allahabad High Court

Sunil Ambwani & Aditya Nath Mittal, JJ.

CIT & Anr. v. Vridnaban Real Estate (P) Ltd.

IT Appeal Nos. 486 of 2008 & 344, 347 & 609 of 2011

A.Y.s. 1997-98 to 2001-02

24 July, 2012

Income-tax Act, 1961, s. 147 In favour of: Assessee

Revenue by : A.N. Mahajan & D. Awasthi

Assessee by : A. Bansal & S.K. Gosg,

JUDGMENT

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