RAJESH BALIA, J. - (1.) THIS appeal is directed against the order of the Tribunal, Jodhpur Bench, Jodhpur, dt. 26th May, 2003 relating to asst. yr. 1988 -89 deciding ITA No. 1111/Jp/1994 and ITA No. 898/Jp/1995 filed by the respondent -assessee before the Tribunal. There were cross -appeals filed by the assessee to the extent they were aggrieved with the order passed by the CIT(A) in an appeal filed by the assessee against the order of reassessment for the asst. yr. 1988 -89 dt. 30th Nov., 1993.
(2.) THE appeal of the assessee was allowed and that of the Revenue was dismissed by the Tribunal on threefold grounds. Firstly, that prior to amendment of Section 147 w.e.f. 1st April, 1989, it was required under Section 148 that the AO gives to the assessee a notice for filing return of not less than 30 days whereas after the amendment, it was required that the assessee should be given a notice to file return within 30 days. The Tribunal found distinction between the expression 'within 30 days' and 'not less than 30 days' and held that since the reassessment proceeding relating to asst. yr. 1988 -89, which ended prior to the commencement of the amended provisions w.e.f. 1st April, 1989, the amended provisions were not applicable in relation to the assessment already completed. Since notice to file return within '30 days' was of lesser duration than not less than 30 days, it was invalid. The second ground which prevailed with the Tribunal was that the AO has not recorded his own satisfaction to the escapement of income from levy of tax for asst. yr. 1988 -89 but has merely acted on the opinion of another officer making an order under Section 132(5) for the purpose of retaining assets and account books which were seized during the search operations conducted on the premises of the assessee. The search took place in November, 1988. It was found by the Tribunal that the AO, while exercising jurisdiction under Section 147 must act on his own satisfaction and not on derivative satisfaction of some other officer, therefore, the basic precondition for the AO to hold the reason to believe that income has escaped assessment for asst. yr. 1988 -89 was lacking.
(3.) LASTLY , it was found that before initiating proceedings under Section 147 for the impugned asst. yr. 1988 -89, the reasons for initiating such proceedings were not recorded as required by Sub -section (2) of Section 148. The reasons are purported to have been recorded on 30th Sept., 1991 and notices have been issued on 14th Oct., 1991.;