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| The Tax Publishers2021 TaxPub(DT) 4728 (Hyd-Trib) INCOME TAX ACT, 1961
Section 147
Re-opening reasons have to be read on stand alone basis without any possibility of addition, deletion or substitution therein at any latter point of time and if such conditions is not satisfied then quash the impugned re-opening itself for having failed to record the appropriate reasons pin pointing escapement of assessee's taxable income from being assessed.
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Reassessment - Validity - Reasons for re-opening not alleging any escapement of assessee -
AO issued notice for reassessment under section 147 on the ground that assessee had received an amount as compensation from HUDA on acquisition of agricultural lands. The assessee has received an amount of Rs. 1,20,80,000 as compensation from HUDA on acquisition of agricultural lands at Kollur Village of Medak District. The assessee claimed that the lands were agricultural lands and purchased by her in the year 2001 and the same was used by her for cultivation. The lands were situated 20Km away from the limits of Hyderabad and Cyberabad limits and hence no capital gains tax-a-rise on these lands. But the assessee had not offered any agricultural income. If these lands were not agricultural lands the compensation would have to be treated as sale proceeds and such income received should be brought to tax under the head income from other sources. The notice stated that verification is to be made, whether these lands are agricultural lands or not and also to ascertain if suppression of receipts was resorted to or not'. Held: The Revenue failed to dispute that the reopening reasons no where indicate as to whether the assessee's taxable income liable to be assessed had escaped assessment or not. High Court in its landmark decision in Hindustan Unilever Ltd. v. R.B. Wadkar 2004 TaxPub(DT) 1424 (Bom-HC) : (2004) 268 ITR 332 (Bom) held that re-opening reasons have to be read on stand alone basis without any possibility of addition, deletion or substitution therein at any latter point of time and quash the re-opening itself for having failed to record appropriate reasons pinpointing escapement of assessee's taxable income from being assessed. The very principle apply mutatis mutandis to assessee's case and re-assessment was liable to be quashed.
Followed:Commr. of Cus. (Import), Mumbai v. Dilip Kumar And Company & Ors. (2018) 9 SCC 1 (FB)(SC) : 2018 TaxPub(EX) 737 (SC) and Hindustan Lever Ltd. v. R. B. Wadkar, Asstt. CIT & Ors. (No. 1) (2004) 268 ITR 332 (Bom) : 2004 TaxPub(DT) 1424 (Bom-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2008-09
IN THE ITAT HYDERABAD BENCH
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