The Tax Publishers2021 TaxPub(DT) 3493 (Mad-HC)

INCOME TAX ACT, 1961

Section 147

Where objections were to be disposed of in a meaningful manner, in view of the fact that the reopening procedures in the present case falls beyond the period of four years and within six years and AO issued a notice under section 143(2) without communicating the reasons for re-opening of the assessment proceedings, thus, a non-speaking order in this regard cannot be sustained and order was to be construed as lacking, on application of mind.

Reassessment - Validity - Non-disposing of objections raised by assessee - Non-speaking order passed

Assessee's case was selected for scrutiny and referred to TPO under section 92CA. He submitted the audit reports to substantiate its claim for the deduction under section 10A. After considering all the documents, TPO passed his order. AO re-opened the assessment and a notice under section 148 was issued. Assessee sought for the reasons for re-opening of assessment. AO, in response, issued a notice under section 143(2) without communicating the reasons for re-opening of the assessment proceedings. Assessee submitted that the procedures contemplated were not followed and even before furnishing reasons for re-opening of assessment, notice under section 143(2) was issued. Held: Objections were to be disposed of in a meaningful manner, in view of the fact that the reopening procedures in the present case falls beyond the period of four years and within six years. Consideration of objections and the findings for reopening are of vital and in the absence of any reasons, one cannot form an opinion that reopening of assessment is made with reference to the conditions stipulated in the proviso clause to section 147. Authority competent must provide reasons, stating that conditions stipulated in proviso clause was complied with. Thus, a non-speaking order in this regard cannot be sustained and was to be construed as lacking, on application of mind.

Followed:GKN Driveshafts (India) Ltd. v. ITO & Others (2003) 259 ITR 19 (SC) : 2003 TaxPub(DT) 0734 (SC).

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2009-10



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