INCOME TAX ACT, 1961

Section 147, Proviso

Reassessment - Beyond four years - No failure to disclose fully and truly all material facts -

AO reopened assessment after expiry of four years from the end of relevant assessment year so as to disallow prior period expenses on the basis of audit objection raised by audit party. Assessee challenged this on the ground of no failure to disclose fully and truly all material facts. Held: On perusal of reasons recorded for reopening of assessment it was apparent that AO had not pointed out that what facts were not disclosed by assessee in the original return. Clearly, audited objjection was raised on the basis of facts available on record and, therefore, reopening was hit by proviso to section 147 and extended limitation period of six years was not available to AO and, therefore, reassessment order passed beyond limitation was quashed as invalid.

Relied:Former France, (2003) 264 ITR 566 (SC) : 2003 TaxPub(DT) 933 (SC), Kelvinator of India Ltd. (2002) 256 ITR 1 (Del) : 2002 TaxPub(DT) 1348 (Del-HC), Kaira District Cooperative Milk Producers Union Ltd., (1996) 220 ITR 194 (Guj-HC) : 1996 TaxPub(DT) 478 (Guj-HC), Jindal Photofilms Ltd. (1998) 234 ITR 170 (Del-HC) : 1998 TaxPub(DT) 1334 (Del-HC), Berger Paints India Ltd. (2000) 245 ITR 645(Cal-Trib) : 2000 TaxPub(DT) 1389 (Cal-Trib), Mercury Travels Ltd., (2002) 258 ITR 533(Cal-HC) : 2002 TaxPub(DT) 1654 (Cal-HC), Eicher Ltd. (2007) 294 ITR 310 (Del-HC) : 2007 TaxPub(DT) 1255 (Del-HC), Voltas Limited. (2012) 349 ITR 656 (Bom-HC) : 2012 TaxPub(DT) 3293 (Bom-HC), Manjusha Estate (P) Ltd., (2009) 314 ITR 236(Guj-HC) : 2009 TaxPub(DT) 1486 (Guj-HC), Jal Hotels Co. Ltd., (2009) 184 Taxman 1 (Del-HC) : 2009 TaxPub(DT) 1751 (Del-HC), Feather Foam Ent. (P) Ltd., (2008) 296 ITR 342(Del) : 2008 TaxPub(DT) 634 (Del-HC), Goetze Ltd. (2010) 321 ITR 431 (Del-HC) : 2010 TaxPub(DT) 1356 (Del-HC), Satnam Overseas (2010) 228 CTR 121 (Del-HC) : 2010 TaxPub(DT) 1169 (Del-HC), IL& FS Investment Managers Ltd. (2008) 298 ITR 32 (Bom-HC) : 2008 TaxPub(DT) 2376 (Bom-HC), ICICI Prudential Life Insurance, (2010) 325 ITR 471 (Bom-HC) : 2010 TaxPub(DT) 1638 (Bom-HC), Siemens Information. (2007) 295 ITR 333 (Bom-HC) : 2007 TaxPub(DT) 1533 (Bom-HC), Chakiat Agencies (P) Ltd. (2009) 314 ITR 200 (Mad-HC) : 2009 TaxPub(DT) 1579 (Mad-HC), Bhavesh Developers, (2010) 229 CTR 160 (Bom-HC) : 2010 TaxPub(DT) 1307 (Bom-HC), Berger Paints India Ltd., v. Jt.CIT (2000) 245 ITR 645(Cal-Trib) : 2000 TaxPub(DT) 1389 (Cal-Trib), Mercury Travels Ltd. v. Dy.CIT (2002) 258 ITR 533(Cal-HC) : 2002 TaxPub(DT) 1654 (Cal-HC), Berger Paints India Ltd., v. Asstt. CIT (2010) 322 ITR 369 (Cal-HC) : 2010 TaxPub(DT) 754 (Cal-HC), Aventis Pharma Limited, (2010) 323 ITR 570 (Bom-HC) : 2010 TaxPub(DT) 1632 (Bom-HC), Usha International Limited, (2012) 348 ITR 485 (Del-HC) : 2012 TaxPub(DT) 2966 (Del-HC), KLM Royal Dutch Airlines, (2007) 292 ITR 49 (Del-HC) : 2007 TaxPub(DT) 897 (Del-HC), Vipan Khanna, (2002) 255 ITR 220 (P&H-HC) : 2002 TaxPub(DT) 6 (P&H-HC), NYK Line (India) Ltd. (2012) 68 DTR 90(Bom-HC) : 2012 TaxPub(DT) 2561 (Bom-HC), Bhor Industries Ltd., (2004) 267 ITR 161 (Bom-HC) : 2004 TaxPub(DT) 0473 (Bom-HC), Hindustan Lever Ltd., (2004) 268 ITR 332 (Bom-HC) : 2004 TaxPub(DT) 1424 (Bom-HC), Bhogwati Sahakari Sakhar Karkhana Ltd., (2004) 269 ITR 186(Bom-HC) : 2004 TaxPub(DT) 1253 (Bom-HC), Ajanta Pharma Ltd. (2004) 267 ITR 200 (Bom-HC) : 2004 TaxPub(DT) 1151 (Bom-HC), Grindwell Norton, (2004) 267 ITR 673 (Bom-HC) : 2004 TaxPub(DT) 1183 (Bom-HC), Feather Foam Ent. (P) Ltd. (2008) 296 ITR 342(Del) : 2008 TaxPub(DT) 0634 (Del-HC), Abdul Rahman Sail. (2008) 306 ITR 142 (Chen-HC) : 2008 TaxPub(DT) 808 (Mad-HC), Asteroids Trading and Investment (P) Ltd., (2009) 308 ITR 190 (Bom-HC) : 2009 TaxPub(DT) 643 (Bom-HC), Jyoti Devi. 218 CTR 80 (Bom), Cartini India Ltd. (2009) 224 CTR 82 (Bom-HC) : 2009 TaxPub(DT) 1584 (Bom-HC), Mittal Casting Ltd., (2002) 124 Taxman 11 (Del-HC) : 2002 TaxPub(DT) 1379 (Del-HC), Atma Ram Properties (P) Ltd. (2012) 343 ITR 141 (Del-HC) : 2012 TaxPub(DT) 760 (Del-HC), Satnam Overseas. (2010) 228 CTR 121 (Del-Trib) : 2010 TaxPub(DT) 1169 (Del-HC), Ashok Mittal, (2014) 224 Taxman 55 (Del-HC) : 2014 TaxPub(DT) 2777 (Del-HC), Orient Craft Ltd. (2013) 354 ITR 536 (Del-Trib) : 2013 TaxPub(DT) 1623 (Del-HC), Sheo Nath Singh. (1971) 82 ITR 148 (SC) : 1971 TaxPub(DT) 362 (SC), Ganga Saran & Sons (P) Ltd., (1981) 130 ITR 1 (SC) : 1981 TaxPub(DT) 952 (SC), Birla VXL, (1996) 217 ITR 1 (Guj) : 1996 TaxPub(DT) 451 (Guj-HC), Multiscreen Media (P) Ltd. (2010) 324 ITR 54 (Bom-HC) : 2010 TaxPub(DT) 1542 (Bom-HC), Garden Finance Limited, (2004) 268 ITR 48(Guj) : 2004 TaxPub(DT) 1423 (Guj-HC), Kamlesh Sharma, (2006) 287 ITR 337 (Del-HC) : 2006 TaxPub(DT) 1819 (Del-HC), Allana Cold Storage Ltd. v. ITO (2006) 287 ITR 1 (Bom-HC) : 2006 TaxPub(DT) 1871 (Bom-HC), Asian Paints Limited, (2008) 296 ITR 90 (Bom) : 2008 TaxPub(DT) 496 (Bom-HC), Keshav Shares and Stocks Ltd., (2008) 326 ITR 553(Del-HC) : 2008 TaxPub(DT) 2119 (Del-HC), Vishwanath Engineers, (2013) 354 ITR 211 (Guj-HC) : 2013 TaxPub(DT) 1611 (Guj-HC), Aroni Commercials Ltd., (2014) 362 ITR 403 (Bom) : 2014 TaxPub(DT) 1649 (Bom-HC), Torrent Power SEC Ltd., 45 Taxman.com 443(Guj), Lakhmani Mewal Das. (1976) 103 ITR 437.448(SC) : 1976 TaxPub(DT) 0742 (SC), Arjun Singh, (2000) 246 ITR 363, 405(MP-HC) : 2000 TaxPub(DT) 0444 (MP-HC), Seth Brothers. (2001) 251 ITR 270 (Guj-HC) : 2001 TaxPub(DT) 1462 (Guj-HC), Bombay Pharma Products, (1999) 237 ITR 614 (MP) : 1999 TaxPub(DT) 1067 (, MP-HC), Lokendra Singh Rathore, (1985) 155 ITR 629 (MP) : 1985 TaxPub(DT) 1042 (MP-HC), United Electrical Co. (P) Limited, (2002) 258 ITR 317 (Del) : 2002 TaxPub(DT) 1670 (Del-HC), Foramer France (2003) 264 ITR 566 (SC) : 2003 TaxPub(DT) 933 (SC), Purolator India Ltd. (2012) 343 ITR 155 (Del-HC) : 2012 TaxPub(DT) 1720 (Del-HC), Motor & General Fiance, (2009) 184 Taxman 465 (Del) : 2009 TaxPub(DT) 367 (Del-HC), Titanor Components Ltd. (2011) 343 ITR 183 (Bom) : 2011 TaxPub(DT) 2162 (Bom-HC), D.T. & T.D.C. Ltd., (2010) 232 CTR 260 (Del-HC) : 2010 TaxPub(DT) 1384 (Del-HC), Haryana Acrylic Manufacturing Company, (2009) 308 ITR 38 (Del-HC) : 2009 TaxPub(DT) 1007 (Del-HC), German Remedies Ltd. (2006) 287 ITR 494 (Bom) : 2006 TaxPub(DT) 0885 (Bom-HC), Grindwell Norton, (2004) 267 ITR 673 (Bom-HC) : 2004 TaxPub(DT) 1183 (Bom-HC), Pe/co Lectronics & Electricals Ltd., (1994) 210 ITR 991 (Cal_HC) : 1994 TaxPub(DT) 122 (Cal-HC), Kaira District Cooperative Milk Producers Union Ltd. 216 ITR 317 (Guj), Garden Silk Mills Ltd., (1996) 222 ITR 27 (Guj) : 1996 TaxPub(DT) 1170 (Guj-HC), Veer Overseas Ltd. ITA No. 510 of 2009 (P & H-HC) : 2010 TaxPub(DT) 1682 (P&H-HC), Fenner India Ltd., (2000) 241 ITR 672 (Mad) : 2000 TaxPub(DT) 453 (Mad-HC), Dulli Chand Singhania, (2004) 269 ITR 192 (P&H) : 2004 TaxPub(DT) 1220 (P&H-HC), Babu Lai Jug Raj & Co. (2007) 289 ITR 115 (Raj) : 2007 TaxPub(DT) 552 (Raj-HC), Shri Tirath Ram Ahuja (HUF) (2008) 306 ITR 173(Del) : 2008 TaxPub(DT) 1860 (Del-HC), Haryana Acrylic Manufacturing Company, (2009) 308 ITR 38 (Del-HC) : 2009 TaxPub(DT) 1007 (Del-HC), India Farmers Fertilizer Cooperative Ltd., (2008) 171 Taxman 379 (Del) : 2008 TaxPub(DT) 1017 (Del-HC), Wei Intertrade (P) Ltd., (2009) 308 ITR 22 (Del-HC) : 2009 TaxPub(DT) 0733 (Del-HC), J P Bajpai HUF, (2004) 269 ITR 40 (All-HC) : 2004 TaxPub(DT) 1602 (All-HC), JSRS Udyog Ltd., (2009) 313 ITR 321 (Del-HC) : 2009 TaxPub(DT) 1154 (Del-HC), DT&TDS, (2010) 232 CTR 260 (Del-HC) : 2010 TaxPub(DT) 1384 (Del-HC), Jashan Textile Mills (P) Limited. (2006) 284 ITR 542 (Bom-HC) : 2006 TaxPub(DT) 1450 (Bom-HC), Durga Prashad Goyal (2006) 98 ITD 227 (Asr.-Trib) (SB) : 2006 TaxPub(DT) 1041 (Asr-Trib).

SUBSCRIBE FOR FULL CONTENT