2012 (2) TMI 85

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....t, 1961, by which the assessment for Assessment Year 200405 is sought to be reopened. The reopening of the assessment is admittedly beyond the period of four years from the end of the relevant assessment year. 3. On 30 August 2006, the Assessing Officer passed an order of assessment under Section 143(3). The total income of the assessee was computed at Rs.7.62 lakhs. The book profit of the assessee under Section 115JB was computed at Rs.1.21 crores. The reasons which have been furnished to the assessee for reopening the assessment are as follows : "Assessment in this case has been completed u/s.143(3) on 30082006 at total income under normal provisions at Rs.7,62,650/and book profit at Rs.1,21,84,293/. Subsequently it is seen that while ....

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...., the basic requirement in the proviso to Section 147 for reopening the assessment beyond the period of four years has not been fulfilled; (ii) As regards the amount representing a diminution in the value of investment (Rs.1.28 crores), Explanation (1)(i) to Section 115JB was introduced by the Finance (No.2) Act, 2009 with retrospective effect from 1 April 2001. Hence, while, in view of the amended provisions, there may be reason to believe that income has escaped assessment, that in itself cannot sustain the order of reopening in the present case beyond the period of four years since a retrospective amendment of law by Parliament cannot give rise to an inference that there was a failure on the part of the assessee to fully and truly disclo....

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....t the primary requirement set out in the proviso to Section 147 has not been fulfilled. That apart, it is evident that in so far as the diminution in the value of investment of Rs.1.28 crores is concerned, Explanation (1)(i) was inserted into the provisions of Section 115JB by the Finance (No.2) Act, 2009 with retrospective effect from 1 April 2001. Clause (i) of Explanation (1) was introduced to include the amount or amounts set aside as provision for diminution in the value of investment. In view of the retrospective amendment of law by Parliament, the Assessing Officer may have reason to believe that income has escaped assessment. But that in itself is not sufficient for reopening an assessment beyond the period of four years. Beyond the....