INCOME TAX ACT, 1961

Section 147

Reassessment - Full and true - Notice for reopening of assessment issued after expiry of four years -

Revenue challenged order of Tribunal holding that reopening of assessment under section 147 was not justified. Revenue alleged that amount of Rs. 159.46 Cr was credited directly to Capital reserve account without crediting to P&L account as cessation of liability under section 41(1), and same was not dealt with in original assessment proceedings. Therefore, revenue contended that Tribunal was not justified in holding that it did not constitute “information” within meaning of section 147(b). Held: In the entire reasons recorded there was not even a whisper that there is any failure on the part of the assessee to disclose fully and truly all material facts. It being an admitted position that the assessment is sought to be reopened beyond a period of four years from the end of the relevant assessment year in a case where a scrutiny assessment has been made under section 143(3) it was incumbent upon AO to record, in reasons itself, as to whether there was any failure on the part of the assessee to disclose fully and truly all material facts. In absence of any such finding in the reasons recorded for reopening the assessment, the assumption of jurisdiction on the part of AO, beyond a period of four years from the end of the relevant assessment year, lacked validity

REFERRED :

FAVOUR : In assessee's favour

A.Y. :

SUBSCRIBE FOR FULL CONTENT