Reassessment beyond four years barred where full disclosure was made and reopening material did not satisfy the statutory condition.

Reassessment issued after four years from the end of the relevant assessment year was held barred by the first proviso to section 147 because the original assessment was completed under section 143(3), the return was filed under section 139(1), and the assessee had disclosed the share capital details during the original proceedings. The reopening material concerned one investor whose assessments under sections 153A and 153C had already been completed without addition, which supported the view that the statutory condition for reopening was not satisfied. The reassessment was quashed as time-barred, and the merits of the additions were left unexamined as academic.

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Issues: Whether reassessment initiated after the expiry of four years from the end of the relevant assessment year was barred by the first proviso to section 147 of the Income-tax Act, 1961.

Analysis: The original assessment had been completed under section 143(3) of the Income-tax Act, 1961, and the reassessment notice was issued beyond four years from the end of the assessment year. The assessee had filed its return under section 139(1) and had disclosed the share capital details during the original assessment proceedings. The material relied upon for reopening related to one investor whose assessment under sections 153A and 153C had already been completed without any addition, supporting the assessee's contention that there was no basis to treat that company as bogus. In these circumstances, the condition precedent for invoking the proviso to section 147 was not satisfied.

Conclusion: The reassessment proceedings were barred by limitation and were quashed. The additions on merits were not adjudicated as they had become academic.

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