Court dismisses petition challenging assessment reopening for specific years under Income-tax Act, emphasizing separate unit for each year.

The court rejected the petitioner's arguments regarding the reopening of assessment for the assessment years 1995-96 and 1996-97 under section 148 of the Income-tax Act. It held that the unpaid expenses were overlooked during the initial assessment, ruling out the claim of change of opinion. The court emphasized that each year is considered a separate unit under the Income-tax Act, dismissing the attempt to link the present notice to a previous one. Consequently, both writ petitions were dismissed based on these findings.

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Issues: Reopening of assessment for assessment years 1995-96 and 1996-97 u/s 148 of the Income-tax Act based on alleged escapement of income.

Judgment Details:

Facts: The petitioner filed its return for the assessment year 1995-96, showing total income of Rs.6,77,380, which was accepted under section 143(1)(a). Subsequently, an unpaid expense of Rs.7,85,613 was detected by the Assessing Officer, leading to the issuance of the impugned notice under section 148 dated March 14, 2001.

Arguments: The petitioner contended that the notice was issued merely on the basis of a change of opinion and should not lead to valid reassessment. It was argued that the notice was a sequel to a previous notice for the assessment year 1994-95, and the proviso to section 147 should apply in this case as well.

Findings: The court rejected the arguments, stating that the unpaid expenses were overlooked during the initial acceptance under section 143(1)(a), thus ruling out the claim of change of opinion. The proviso to section 147 applies only to cases where reopening is sought of assessments under section 143(3), which was not the situation here. Each year is considered a separate unit under the Income-tax Act, and the court found no merit in linking the present notice to the previous one for the assessment year 1994-95.

Conclusion: Both writ petitions were dismissed, and Writ Petition No. 943 of 2001 and Writ Petition No. 935 of 2001 were rejected based on the above reasoning.

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