Appeal allowed due to invalid reassessment beyond four years. Deemed infructuous appeal from subsequent order.

The tribunal allowed the appeal in ITA No. 3369/M/2015, declaring the reopening of assessment beyond four years as invalid. The appeal in ITA No. 420/Mum/2014 was deemed infructuous due to the subsequent order's invalidity following the invalid reassessment proceedings.

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Issues Involved: Validity of reopening assessment beyond four years under section 147 of the Income-tax Act, 1961; Rectification order passed under section 154 and its validity.

Issue 1: Validity of Reopening Assessment Beyond Four Years (ITA No. 3369/Mum/2015):
The assessee, engaged in pharmaceuticals business, challenged the reopening of assessment beyond four years by the Assessing Officer (AO). The First Appellate Authority (FAA) upheld the reopening, citing cases to support the decision. The Authorized Representative (AR) argued that there was no failure to disclose material facts and reopening after four years was legally flawed. The Departmental Representative (DR) did not contest this argument. The tribunal observed that the AO did not mention the failure of the assessee to disclose all material facts leading to income escapement, a crucial requirement for reopening assessments beyond four years. Referring to the judgment in the case of Titanor Components Ltd., the tribunal held that the reopening was invalid as the AO failed to establish the failure on the part of the assessee to fully and truly disclose material facts. Consequently, the tribunal decided in favor of the assessee on this ground, rendering other grounds of appeal unnecessary for adjudication.

Issue 2: Validity of Rectification Order (ITA No. 420/Mum/2014):
The appeal in this matter arose from a rectification order passed under section 154. The assessee requested rectification of mistakes in the order passed earlier. The FAA dismissed the appeal. During the tribunal hearing, the AR argued that since the reassessment proceedings were deemed invalid, the subsequent order passed by the AO would also be invalid. Building on the decision made in the earlier appeal, the tribunal concluded that the subsequent order by the AO would not stand valid due to the invalidity of the reassessment proceedings. Therefore, the appeal filed by the assessee in this case was deemed infructuous and not adjudicated upon.

In conclusion, the tribunal allowed the appeal filed by the assessee in ITA No. 3369/M/2015, declaring the reopening of assessment beyond four years as invalid. Additionally, the appeal in ITA No. 420/Mum/2014 was treated as infructuous due to the invalidity of the subsequent order passed by the AO.

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