Mohammad Rafiq, J. - (1.) THIS writ petition has been filed by petitioner, Shree Om Builders & Colonizers, challenging notice issued by respondent No. 2 - -the Dy. CIT, Central Circle -1. Jaipur, dt. 12th Dec. 2011, under s. 148 of the IT Act, 1961 (for short, 'the Act of 1961'); reasons supplied for reopening of the case under s. 147 of the Act of 1961 for asst. yr. 2009 -10 and the order dt. 28th March, 2012 rejecting objections submitted by the petitioner. Shri Prakul Khurana, learned counsel for the assessee, has argued that notice for initiating reassessment proceedings are based on mere surmises and conjectures that sale consideration mentioned in the registered sale -deed is less than the actual sale consideration and there has been exchange of money over and above the recorded sale consideration. Alleged basis for such suspicion is that the IT Department during the course of search in the case of M/s. Kamakshi Hospitality, has found that there was exchange of money over and above the recorded sale consideration in relation to some property situated in Bani. Park, Jaipur and therefore the sale consideration disclosed by the petitioner for that property also cannot be relied as the market value of petitioner's properties on mere basis of the alleged vicinity. It is further contended that the Department has not found any material/evidence/proof during the course of search proceedings or post -search assessment proceedings which could have led to the requisite formation of the belief that the transaction between the petitioner herein and Kamakshi International has been entered on a higher amount than shown in the registered sale deed. Even in the survey that was conducted by the Department at the premises of the petitioner pursuant to search at the premises of M/s. Kamakshi International, no contrary evidence/material was found which could have led to such belief that the petitioner has also sold the land on a higher value than shown in the registered sale deed. Issuance of notice under s. 148 of the Act of 1961 for reassessing the income of petitioner for the asst. yr. 2009 -10, on a mere suspicion that the petitioner must have also sold the land on a higher value, is totally devoid of any basis and is wholly illegal. The impugned reassessment proceedings have been initiated on 'mere suspicion' and not on the basis of 'reasons to believe', which is a mandatory requirement for the purpose of issuing notice under s. 118 of the Act of 1961. It is argued that locality of Bani Park is spread over a very big area and is one of the biggest colonies/localities of the city of Jaipur. It has both commercial as well as residential spaces and the differences in the prices of such commercial and residential spaces vary to a great extent based on the actual location of the plot. Price of a particular land/plot also depends upon the actual location and the commercial viability of the area where it is situated. Petitioner's plot No. D -81 is a residential property and is located on an inner road of Ghiya Marg in Bani park, whereas comparable Plot No. D -112 -A is a commercial property located on Station Road, which is a commercial road of Bani Park and located barely 300 metres from the main Railway Station of Jaipur towards Chinkara Canteen. Moreover, the plot of the petitioner is located on a 40' wide road whereas plot with which comparison is sought to be made is situated on a 100' wide road. Plot of the petitioner is situated at T point which, according to Vastu, is not considered good/auspicious and such property fetches less market value. Besides there being a transformer of the R.S.E.B. installed just in front of the plot of the petitioner, which occupies 10' front of the plot. Both the properties are not in close vicinity. There is distance between them of about 2.5 kilometre. The rate of the plot of the petitioner presumed by respondents Nos. 1 and 2 is wholly unrealistic and unfounded and is not based on sale deed of any plot in the close vicinity of the plot of the petitioner.
(2.) SHRI Prakul Khurana, learned counsel argued that petitioner in response to the notice, filed two replies respectively on 19th Dec, 2011 and 27th March, 2012 objecting against the issuance of the impugned notice describing the reasons for it to be illegal and without authority of law as the same has been issued on the basis of mere suspicion and not on the basis of reasons to believe. Respondents however rejected those objections vide order dt. 28th March, 2012. Learned counsel argued that reasons recorded by respondent No. 1 for issuing notice under s. 148 of the Act of 1961 are not in consonance with the statutory provisions contained in s. 50C of the Act of 1961. Allegation of showing sale consideration of the plot of the petitioner towards lower side in the sale -deed cannot be justified because the position of law is very much clear and there is specific provision in the Act itself, which covers such nature of cases of understatement of sale consideration. As per s. 50C, it is the stamp valuation adopted by the Stamp Registering Authority, which has to be taken into consideration for the purpose of assuming the correct consideration liable to be taxed for the purpose of tax. Learned counsel for the petitioner argued that respondents have rejected the objections of the petitioner on the premise that sufficiency of reasons cannot be a question at the preliminary stage, whereas once the competent authority has formed a requisite opinion as to his belief for issuance of notice for reassessment, what remains is mere computation of the tax, satisfaction as to the escapement of tax having become fait accompli The respondents in rejecting the objections have wrongly maintained that he has recorded proper reasons based on substantial material in the form of evidence whereas no evidence has been disclosed either in the reasons supplied to the petitioner or the order of rejecting the objections. Further the competent authority in rejecting the objections of the petitioner has wrongly maintained that information received during the course of assessment proceedings of the third party can form the basis for belief of escapement of income.
(3.) LEARNED counsel for the petitioner lastly argued that the service of notice on the petitioner is mere formality because AO has determined to revise the assessment. The writ petition is only effective remedy. Requiring the petitioner to go back to the AO and wait for the passing of the final assessment order would be a mere formality because the AO has already formed an opinion as to escapement of the income. He may, therefore, possibly not now change that opinion.;