Tax Assessment: ‘Evidence Which Reveals’ : A New Conundrum?

NEW REASSESSMENT PROCEDURE

1. Introduction:

In the film JOLLY LLB, the judge, unforgettably played by actor Saurabh Shukla, in the concluding speech while delivering his judgment says:

‘But I am the judge. who knows what, what I feel, judgment cannot be given on that basis. I HAVE TO GIVE JUDGMENT ON THE BASIS OF EVIDENCE. ’On the first date of the case, I know who is the culprit. I sit here and keep on waiting for the evidence. Evidence will come now. evidence will come now…. . …A big pile gets created. File over file, file over file. But not a single paper comes, not a single one, which I can say ‘this is evidence’. Evidence does not come…. . ’’

This dialogue encapsulates the dilemma that revenue is going to face in that part of the new amendment which shall supposedly check serious and major cases of tax evasion.

1. 1 A mouth watering prospect for a student of law and a road untravelled for assessee which revenue has opened up in form of new provisions of s 148, in effect from 1-4-2021. The term ‘’evidence ‘ makes a grandstand appearance in a enabling provision of the Income Tax Act. It has reference in in procedural part of several provisions as more or less a done deal, which surprisingly was never latched on to, by the taxpayer, at least not in my knowledge, and not directly, resulting in skewed assessments and prolonged litigation. Now suddenly the term gets a pride of place in a substantive, validating provision. More on this later.

2. The provision:

SECTION 149.

Time limit for notice.

[(1) No notice under section 148 shall be issued for the relevant assessment year, —

(a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b);

(b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of accounts or other documents or evidence which reveal that the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more for that year:

Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if such notice could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section, as they stood immediately before the commencement of the Finance Act, 2021:

Provided further that the provisions of this sub-section shall not apply in a case, where a notice under section 53A, or section 153C read with section 153A, is required to be issued in relation to a search initiated under section 132 or books of account, other documents or any assets requisitioned under section 132A, on or before the 31st day of March, 2021:

Provided also that for the purposes of computing the period of limitation as per this section, the time or extended time allowed to the assessee, as per show-cause notice issued under clause (b) of section 148A or the period during which the proceeding under section 148A is stayed by an order or injunction of any court, shall be excluded:

Provided also that where immediately after the exclusion of the period referred to in the immediately preceding proviso, the period of limitation available to the Assessing Officer for passing an order under clause (d) of section 148A is less than seven days, such remaining period shall be extended to seven days and the period of limitation under this sub-section shall be deemed to be extended accordingly.

Explanation. —For the purposes of clause (b) of this subsection, “asset” shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account. ’.

(2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151.

Subs. by Finance Act, 2021.

2. 2 LEGISLATIVE INTENT NEEDS TO BE READ BEHIND NEW PROCEDURE OF REASSESSMENT AS IS CLEAR FROM THE MEMORANDUM

The salient features of new procedure are as under:-

(i) The provisions of section 153A and section 153C, of the Act are proposed to be made applicable to only search initiated under section 132 of the Act or books of accounts, other documents or any assets requisitioned under section 132A of the Act, on or before 31st March 2021.

(ii) Assessments or reassessments or in re-computation in cases where search is initiated under section 132 or requisition is made under 132A, after 31stMarch 2021, shall be under the new procedure.

(iii) Section 147 proposes to allow the Assessing Officer to assess or reassess or re-compute any income escaping assessment for any assessment year (called relevant assessment year).

(iii) Before such assessment or reassessment or re-computation, a notice is required to be issued under section 148 of the Act, which can be issued only when there is information with the Assessing officer which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the relevant assessment year. Prior approval of specified authority is also required to be obtained before issuance of such notice by the Assessing Officer.

(iv) It is proposed to provide that any information which has been flagged in the case of the assessee for the relevant assessment year in accordance with the risk management strategy formulated by the Board shall be considered as information which suggests that the income chargeable to tax has escaped assessment. The flagging would largely be done by the computer based system.

(v) Further, a final objection raised by the Comptroller and Auditor General of India to the effect that the assessment in the case of the assessee for the relevant assessment year has not been in accordance with the provisions of the Act shall also be considered as information which suggests that the income chargeable to tax has escaped assessment.

(vi) Further, in search, survey or requisition cases initiated or made or conducted, on or after 1st April, 2021, it shall be deemed that the Assessing officer has information which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the three assessment years immediately preceding the assessment year relevant to the previous year in which the search is initiated or requisition is made or any material is seized or requisitioned or survey is conducted.

(vii) New Section 148A of the Act proposes that before issuance of notice the Assessing Officer shall conduct enquiries, if required, and provide an opportunity of being heard to the assessee. After considering his reply, the Assessing Office shall decide, by passing an order, whether it is a fit case for issue of notice under section 148 and serve a copy of such order along with such notice on the assessee. The Assessing Officer shall before conducting any such enquiries or providing opportunity to the assessee or passing such order obtain the approval of specified authority. However, this procedure of enquiry, providing opportunity and passing order, before issuing notice under section 148 of the Act, shall not be applicable in search or requisition cases.

(viii) The time limitation for issuance of notice under section 148 of the Act is proposed to be provided in section 149 of the Act and is as below:

in normal cases, no notice shall be issued if three years have elapsed from the end of the relevant assessment year. Notice beyond the period of three years from the end of the relevant assessment year can be taken only in a few specific cases.

In specific cases where the Assessing Officer has in his possession evidence which reveal that the income escaping assessment, represented in the form of asset, amounts to or is likely to amount to fifty lakh rupees or more, notice can be issued beyond the period of three year but not beyond the period of ten years from the end of the relevant assessment year;

2. 3 It seems that s 148 had escaped the faceless dilemma:notso. Sees 151A.

3. The Dilemma:

3. 1 ‘’books of account or other documents or evidence which reveal that’’ :How is this phrase to be read in light of the memorandum?

3. 2 The memorandum is clear. In specific cases(read, beyond 3 years and income represented by an asset)there HAS to be ‘’EVIDENCE WHICH REVEALS’’. Interestingly the actual section gives us 3 partitions(supra).

The argument could be that there is the word ‘’or’’ between books of accounts, other documents and evidence. So they are mutually exclusive. Is a book of account and document not EVIDENCE? Truth is, EVIDENCE subsumes the two other words unless the documents are DUMB or books NON SPEAKING. The saying goes that if two of us are speaking identical things, one of us is irrelevant! It would have been probably better if language of s 69A would have been deployed:’’ money, bullion, jewellery or other valuable article or thing’’. The obfuscatory drafting which mixes substantive and procedural provisions is, I am afraid going to open up contests and debates which never existed in earlier provision.

3. 2. 1 See the relevant part (edited) of earlier s 147:

[Income escaping assessment.

147. If the ⁵ [Assessing] Officer ⁶[has reason to believe⁷] that any income chargeable to tax has escaped assessment⁷ for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income ^{……………………}

Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year::

[Provided further that nothing contained in the first proviso shall apply in a case where any income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment for any assessment year:]

[Provided [also] that the Assessing Officer may assess or reassess such income, other than the income involving matters which are the subject matters of any appeal, reference or revision, which is chargeable to tax and has escaped assessment. ]

Explanation 1. —Production before the Assessing Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer will not necessarily amount to disclosure within the meaning of the foregoing proviso.

Explanation 2. —For the purposes of this section, the following shall also be deemed to be cases where income chargeable to tax has escaped assessment, namely :—

(a) where no return of income ………. .

(b) where a return of income has been furnished ……….

[(ba) where the assessee has failed to furnish a report in respect of any international transaction ………

(c) where an assessment has been made, but—

………… income chargeable to tax has been under assessed ; or

(ii) such income has been assessed at too low a rate ; or

(iii) such income has been made the subject of excessive relief under this Act ; or

(iv) excessive loss or depreciation allowance or any other allowance under this Act has been computed;]

[(ca) where a return of income has not been furnished ……….

[(d) where a person is found to have any asset (including financial interest in any entity) located outside India. ]

[Explanation 3. —For the purpose of assessment or reassessment under this section, the Assessing Officer may assess or reassess the income in respect of any issue, which has escaped assessment, and such issue comes to his notice subsequently in the course of the proceedings under this section, notwithstanding that the reasons for such issue have not been included in the reasons recorded under sub-section (2) of section 148. ]

[Explanation 4. —………. .

3. 2. 2 LET US SEE:

MAIN SECTION: Substantive provision enabling AO to take action

FIRST PROVISO: Substantive provision disabling AO to take action beyond a certain period of time unless conditions specified are met.

SECOND PROVISO: Substantive provision carving an exception to the main proviso

THIRD PROVISO; carving another exception and enabling substantive provision to assess other escaped income. This could have been an Explanation as well.

Explanation 1 : is a RULE OF EVIDENCE. A very interesting one. It makes a difference between EVIDENCE and MATERIAL EVIDENCE: see:

‘’evidence from which material evidence could with due diligence have been discovered’’.

This is well drafted and well thought out: the phrase means:’’ EVIDENCE WHICH HAS PROBATIVE VALUE. ’’

What wonderful piece of legislation to fascinate a student of law and for court audience to be enthralled with when master pleaders took stage. Never did happen though to the best of my knowledge. Readers may kindly illuminate me in the comments section.

Explanation 2: deemed escapement cases but not escaping test of reason to believe in main provision

3. 3 In contrast, in the extant provision(w. . f. 1. 4. 2021)

New 147

Main clause: Main provision of earlier 147severed and placed in a standalone manner

Explanation : parallel to Explanation 3 of earlier s 147

New 148

Main provision: procedural. Speaks of service of notice, filing of ROI and procedure of giving opportunity.

Proviso; substantive. First time we meet the new test ‘’ïnformation which suggests’’. Astonishing. Main provision is the procedure and the proviso is the substantive provision supposedly enabling but actually disabling (parallel to first proviso of earlier 147 mixed with its main part) being couched in the negative.

3. 3. 1 It is a basic rule of interpretation of statutes that a proviso only embraces the field covered by the main provision. It carves an exception to the main provision. But see what it is doing here? It is functioning as a main provision or an Explanation couched in the negative since it is adding to the main provision. This is what is called a bad drafting(TPL division of CBDT presumably does this job. ). Only in exceptional circumstances can a proviso be the main provision[Commr. Comm. Taxes vs R S Jhaver (1967) 8 TMI 37 SC}.

But for the proviso, the enacting part would have included the subject matter of the proviso(Justice GP Singh Int. Of Statutes). The function of a proviso is to qualify something or to exclude, something from what is provided in the enactment which, but for proviso, would be within the purview of enactment. It qualifies the generality of the main enactment by providing an exception. It is alien to the function of a proviso to deal with a subject matter which is foreign to the main content.

See what is done in light of these universally accepted principles? The above proviso is against all the universally accepted principes of drafting legislation as outlined above.

3. 3. 2 Explanation 1 :circumcises the first proviso and limits it by giving a ‘’means’’ definition to ‘’information which suggests’’

Explanation 2:carves an exception out of first explanation and should actually have been proviso itself to Explanation 1 or part of the main provision.

3. 3. 3 See the earlier Explanation 2:it beautifully ADDS TO(which is the role of an Explanation. Meaning of ‘Explanation’ is explained well by Hon’ble Supreme Court in the case of Sundaram Pillai v. Pattabiram reported in (1985) 1 SCC 591, whereby Fazal Ali, J culled out from earlier cases the following as objects of an explanation to a statutory provision (Reference Page 214-215, Principles of Statutory Interpretation by Justice G. P. Singh, 13th Ed. ):—

(a) To explain the meaning and intendment of the Act itself,

(b) Where there is any obscurity or vagueness in the main enactment to clarify the same so as to make it consistent with the dominant object which it seems to subserve,

(c) To provide an additional support to dominant object of the Act in order to make it meaningful and purposeful,

(d) an Explanation cannot in any way interfere with or change the enactment or any part thereof but where some gap is left which is relevant for the purpose of the Explanation, in order to suppress the mischief and advance the object of the Act if it can help or assist the Court in interpreting the true purport and intendment of the enactment, and

(e) It cannot, however, take away a statutory right with which any person under a statute has been clothed or set at naught the working of an Act by becoming an hindrance in the interpretation of the same. ]

3. 3. 4 Here the explanation circumcises the proviso due to an astonishing piece of drafting. The earlier Explanation 2 AND THE PRESENT Explanation 2 are both DEEMING PROVISIONS, but the extant one kills the concept of Explanation whereas the old one EXEMPLIFIES it.

3. 4 Management experts using fancy management phraseology(‘’risk management strategy’’ etc. ) in TPL division would be well advised to take a fundamental course in drafting of law lest such a mess be created where confusion, misinterpretation and avoidable litigation may result. Now it will.

4. THE SOURCE CODE:

4. 1 Reflect for a moment on the new provision:

‘149. Time limit for notice. —(1) No notice under section 148 shall be issued for the relevant assessment year, —

(a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b);

(b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more for that year:

This is a hybrid section, mind you.

4. 2 Now look at a part of earlier s 153A:

153A FOURTH PROVISO

[Provided also that no notice for assessment or reassessment shall be issued by the Assessing Officer for the relevant assessment year or years unless—

(a) the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year or in aggregate in the relevant assessment years;

(b) the income referred to in clause (a) or part thereof has escaped assessment for such year or years; and

(c) the search under section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017.

{Above Inserted by the Finance Act, 2017, w. e. f. 1-4-2017. }

Explanation 1. —For the purposes of this sub-section*, the expression “relevant assessment year” shall mean an assessment year preceding the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment years but not later than ten assessment years from the end of the assessment year relevant to the previous year in which search is conducted or requisition is made.

[*NOTE: This is perhaps an error. What is meant is ‘’for the purpose of this proviso’’. Interestingly there was no DIRECT corresponding amendment under s 153C. ]

Explanation 2. —For the purposes of the fourth proviso, “asset” shall include immovable property being land or building or both, shares and securities, loans and advances, deposits in bank account. ]

This Explanation is lifted and placed as Explanation to NEW S 149(1)(b) Explanation.

‘149. Time limit for notice. —(1) No notice under section 148 shall be issued for the relevant assessment year, —

……………

Explanation. —For the purposes of clause (b) of this sub- section, “asset” shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account.

4. 3 These are a direct lift off. We have yet again successfully managed to create a pot purri of s 153A and s 147(erstwhile), scissored it where our fancy took us and created a ominous new cocktail in an equally omionus rechristened (new if u wish to call it) bottle, in the process creating such confusion that assessment misadventures by the AO are a given. CIT(A) being saddled again by a RISK MANAGEMENT STRATEGY, judicial independence gone, facelessly placed to endorse what legal monstrosities the AO may perpetrate. Don’t be surprised if in years to come, the workload of ITAT increases dramatically.

4. 4. The manner in which ‘’reason to believe ‘’has been given a go by and providing a ‘’means’’ definition takes away discretion and application of mind of the AO and an equally opaque RISK MANAGEMENT STRATEGY created by the regulatory body CBDT comes into play. This is not merely power to delegate legislation; it opens up serious possibilities, in relevant cases, to anulling the whole process. The test of ‘’information’’ would still have to be passed. There are umpteen number of instances where the AOs have been caught on wet ground of incompetence and daftness in drafting of ‘’reason to believe’’. This, in spite of having a fantastic judgment in the form of Rajesh Jhaveri Stockbrokers[291 ITR 500 SC] which should have ideally played the role of bedrock of drafting judicially approvable reasons to believe. But in order to cater to general covert objective of ‘’taking away discretion’’[whatever that means]and overt objective of ‘’providing legislative certainty’’[whatever that means as well]and circumvent the adverse decisions on the aspect of reason to believe, a self defeating behemoth is created which is a pot purriof ‘’information which suggests’’ to ‘’evidence which reveals’’. This is astonishing because from the frying pan of ‘’reason to believe’’ we have walked straight into the fire of ‘’evidence’’. I hope the remedy may not prove worse than the disease.

4. 5 It never pays to cover ineptness and your (in)capabilities by neutralizing them under cover of legislative amendments. Unfortunately, the ruse shows. Also, populist conveniences and rigours of law do not make good friends. Time will test this proposition.

5. Additional conundrums:

5. 1 See Memorandum clause viii(supra)

‘’in normal cases, no notice shall be issued if three years have elapsed from the end of the relevant assessment year. Notice beyond the period of three years from the end of the relevant assessment year can be taken only in a few specific cases.

In specific cases where the Assessing Officer has in his possession evidence which reveal that the income escaping assessment, represented in the form of asset, amounts to or is likely to amount to fifty lakh rupees or more, notice can be issued beyond the period of three yearbut not beyond the period of ten years from the end ofthe relevant assessment year; ‘’

5. 2 There has to be IN POSSESSION of AO ‘evidence which reveals’ …. . so prior to this issuance of notice, information, sorry, evidence must be there. I presume books of accounts and other documents are subsumed in this Memorandum under the omnibus Évidence’.

5. 2. 1 But this is for years 3 to 10. What about years 1 to 3?The evidence has to toreveal for those years also or there must be ‘information which suggests’?

But information has to mean item flagged under RMS or final objection of ASG.

Then same ‘’item’’ shall play role of both-information and evidence?. Or in case of search, requisition or survey, the information clause is rendered inoperative and the concept of evidence takes over from year 1 to 10?Litigation looms large because the assessee would be well advised to take the interpretation which suits best to him on facts.

5. 3 It is a legal postulation that “Absoluta sentential expositure non indigent’ meaning that an absolute judgement or sentence needs no expositer to explain an idea or a theory. It is also posited that ‘Quotes in verb is null aestambiguitasibi null a exposition contra verba express afiendaest’ meaning that when there is no ambiguity in words, then no exposition contrary to the exposed words is to be made.

5. 3. 1 The provisions of the Act as discussed supra are unambiguously clear, hence the verdict is clear…. for years 1 to 3 it’s a blank stipulation that stares in our face. Else, if sanity is to prevail the information which suggests is a deemed non starter for 132, 132A and 133A matters. It has to be evidence which reveals.

5. 4 My concern however runs deeper. If the AO comes across books of accounts/documents/ evidence which reveals income has escaped assessment but this expose is not in course of a 132/132A/133A action, he cannot initiate a 147 action because RMS flag is not up nor is CAG indicating the same.

6. These kind of lacunae cannot be waved off. They have to be read as legislative will to read only what is included and not to read a cassusomissus into it. ‘Quotes in verb is null a est ambiguitasibinulla exposition contra verb a express afiendaest’ (supra)holds fort.

Litigation beckons.

7. The term ‘’evidence ‘, as I said in Introduction, comes in a enabling provision of in the Income Tax Act. It had reference in procedural part of several provisions as more or less a done deal, which surprisingly was never latched on to, by the taxpayer, at least not in my knowledge, and not directly, resulting in skewed assessments and prolonged litigation. Now suddenly the term gets a pride of place in a substantive, validating provision.

7. 1 The trouble which the new provision has caused is this:it is the place where the term EVIDENCE gets placed:

7. 1. 1 In earlier s 147:

Explanation 1. —Production before the Assessing Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer will not necessarily amount to disclosure within the meaning of the foregoing proviso.

Here the term appears as a RULE OF EVIDENCE. Wonderfully crafted sound substantive rule. ’’ Evidence FROM WHICH material evidence’’ could be discovered is a masterpiece not getting the pride of place it deserved in annals of tax litigation. So all evidence is not one which can lead to a verdict of income escaping assessment-it HAS TO BE material evidence-evidence with probative value, that is Wonderful.

And how ‘’technically sound’’ has revenue been that this pillar of brilliant drafting finds no place in the new law. They forgot history Are they condemned to repeat it? Time will tell.

7. 1. 2 Inerst while 153A FOURTH PROVISO

[Provided also that no notice for assessment or reassessment shall be issued by the Assessing Officer for the relevant assessment year or years unless—

(a) the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year or in aggregate in the relevant assessment years;

Here the term causes trouble because it is coming as a prelude, a validating condition, an existential condition, an enabling sine qua non, without which even the notice cannot operate. The revenue has opened itself to challenge which it tried to avoid by knocking off ‘’reason to believe’’ in erstwhile s 147. That is challenge to validity of the notice and once a successful challenge is mounted the action fails before initiation. This is a golden escape route as also a platform to challenge arbitrary, irrational half baked reasons (predilections and biases actually, the surmises and the conjectures)

7. 1. 3 Unfortunately the cut paste job in new S 149 repeats the same fatal error which the challenger would gleefully latch on to:

‘149. Time limit for notice. —(1) No notice under section 148 shall be issued for the relevant assessment year, —

(a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b);

(b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more for that year:

7. 2 That is why ‘’REASON TO BELIEVE’’ was a golden mean, a wonderfully crafted piece of sound legislation which prevented revenue to open assessments on their whims and fancies while on the other hand kept the assessee honest in view of path breaking judgments like Praful Chunnilal Patel, Select Dularb and and Rajesh Jhaveri. We abandoned that and created two extremes, one a information to suggest and two, evidence which reveals. One(‘’information which suggests’’)a self validating logical non sequitur prologue, a pattern of reasoning rendered invalid by fatal flaw in its logical structure, and the other, (‘’evidence’’), a prelude to, which should have been a sequitur to, the investigation.

8. The opportunity before the assessee is simple:challenge the notice issued right away by asking revenue to demonstrate what EVIDENCE it has to re open beyond a period of three years And it has to have probative value. Elseits not evidence but plain prejudice. IF evidence is in form of books of accounts and documents already in the know of the department and having subjected the same to scrutiny once or having let go of the option, it would amount to REVIEW THROUGH REAPPRAISAL OF EVIDENCE-change of opinion in simple terms. Without binding assessee to the requirement of 142(1)or 143(2) or authority of of 142(2) where is this (material)evidence coming from?. THEY HAVE PUT THE HORSE BEFORE THE CART, HAS REVENUE. Assessee has to only call the bluff. I suspect number of challenges to 147 action shall increase manifold. And if there is any evidence collecting investigation PRIOR TO the 147 being initiated, its fidelity and integrity both stand to be irredeemably compromised because on my demand they will have to make me privy to what they consider as Evidence. Impact of this perceptionless legal misadventure will be telling.

9. This should not have been so. Instead of an enabler, evidence should have been a concluder. As in 143(3):have a look:

143[(3) [On the day specified in the notice issued under] sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, makean assessment of the total income or loss of the assessee, and determine the sum payable by him or refund of any amount due to him on the basis of such assessment:]

Here the term EVIDENCE comes as a CULMINATION OF A PROCESS-neither a prelude nor a interlude, just a conclude(ing)to a quasi judicial process. There cannot be adebilitating, subversing, and decisively disabling challenge to the process while its running its course. For the qualifying condition is simple.

143(2):(2) Where a return has been furnished under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer shall, —

………………….

(ii) notwithstanding anything contained in clause (i), if he considers it necessary or expedient to ensure that the assessee has not under-stated the income or has not computed excessive loss or has not under-paid the tax in any manner, serve on the assessee a notice requiring him, on a date to be specified therein, either to attend his office or to produce, or cause to be produced there, any evidence on which the assessee may rely in support of the return:………’’

‘’IF HE CONSIDERS IT NECESSARY OR EXPEDIENT’’: simple –and brilliant. It is well said ‘don’t fix anything if it ain’t broken’’. Well revenue has gone and done exactly that. If anything, this phrase should have been given traction and currency for wider application. But we have rendered it hors de combat.

{It would interest the discerning to note that the term ‘’EVIDENCE’’ is conspicuous by its absence in the other primary section of assessment. :

144

…………………. .

the Assessing Officer, after taking into account all relevant material which the Assessing Officer has gathered, shall, after giving the assessee an opportunity of being heard, make the assessment of the total income or loss to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment. }

10. In the last part of my analysis of new provisions of reassessment, I shall be touching on meaning and scope of 3 words-books of accounts, documents and evidence.