TaxTMI 
TaxTMI 
2013 (3) TMI 193
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...., and the reassessment proceedings should be cancelled." 3. Brief facts leading to the above issue are that assessee for Assessment Year 2005-06 filed its return of income on 29.10.2005, which was processed u/s. 143(1) of the Act. Subsequently, Assessing Officer issued notices u/s. 143(2) and 142(1) of the Act and after discussion on various dates vis a vis books of account and other requisite details, assessment was framed u/s. 143(3) of the Act vide order dated 24.05.2007. During the course of this assessment proceedings, the Assessing Officer disallowed ad-hoc transportation charges at Rs.50,000/- out of the total transportation charges debited by assessee at Rs.2,88,08,554/-. The Assessing Officer disallowed this transportation charges as some of the vouchers were self made and not verifiable. Subsequently, the Assessing Officer issued notice u/s. 148 of the Act dated 09.07.2008. Assessing Officer while framing reassessment disallowed the transportation charges as no TDS was deducted u/s. 194C of the Act. Hence, Assessing Officer invoked the provisions of section 40(a)(ia) of the Act. Thereby he disallowed a sum of Rs.2,87,58,554/-. Aggrieved, assessee preferred appeal before....
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....sidering facts and circumstances of the case a sum of Rs. 50,000/- on estimate is disallowed and added to total income." We further find that the Assessing Officer recorded reasons for issue of notice u/s. 148 dated 09.07.2008 and the same was communicated vide letter dated 12.08.2008 as under: "In response to your above referred letter regarding the above mentioned matter this is to inform you that you have debited Rs.288,08,554/- under the head 'Transport hire charges'. On verification of the list of trucks it is seen that individual payment to each truck during the F.Y. 2004-05, relating to A.Y. 2005-06 exceeded rupees one lakh and accordingly tax was required to be deducted at source u/s 194C of the I.T. Act, 1961. As no TDS was made on payment of transportation charges of Rs.2,88,08,554/- this amount is not allowable as expenses under provision of Section 40(a)(ia). During assessment u/s143(3) of the I.T Act, 1961 only Rs.50,000/- has been disallowed whereas the total amount i.e. Rs.2,88,08,554/- was to be disallowed and to be added to the total income. As the income of Rs.2,38,08,554/- (i.e. Rs. 2,88,08,554/- - Rs.50,000/-) has escaped assessment within the meaning of Sect....
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....e assessee could not produce full name and address of the payee. In such circumstances, whether Assessing Officer in the original assessment proceedings has formed an opinion and subsequent reopening is just on the basis of change of opinion or not. We are of the view that mere fresh application of mind to the same set of facts or mere change of opinion does not confer jurisdiction even after amendment in section 147 of the Act w.e.f. 01.04.1989. This view of ours is supported by the decision of Hon'ble Delhi High Court in the case of Jindal Photo Films Ltd. v. Deputy CIT (1998) 234 ITR 170 (Del), wherein it is held that it cannot be disputed that discovery of new and important matter or knowledge of fresh facts which were not present at the time of original assessment would constitute 'reason to believe that any income chargeable to tax has escaped assessment' within the meaning of even section 147 of the Act as applicable w.e.f. 1-4-1989. Hon'ble Delhi High Court in the given facts held that such facts which could have been discovered by the Assessing Officer but were not so discovered at the time of original assessment may not constitute new information. In that view of the matt....
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....purportedly without application of mind would itself confer jurisdiction upon the Assessing Officer to reopen the proceeding without any thing further, the same would amount to giving a premium to an authority exercising quasi-judicial function to take, benefit of its own wrong. 7. Hon'ble Supreme Court affirmed the decision of Hon'ble Delhi High Court in the case of CIT Vs. Kelvinator of India Ltd. (2010) 320 ITR 561 (SC), wherein it is held as under: "On going through the changes, quoted above, made to section 147 of the Act, we find that, prior to the Direct Tax Laws (Amendment) Act, 1987, reopening could be done under the above two conditions and fulfillment of the said conditions alone conferred jurisdiction on the Assessing Officer to make a back assessment, but in section 147 of the Act (with effect from 1st April, 1989), they are given a go-by and only one condition has remained, viz., that where the Assessing Officer has reason to believe that income has escaped assessment, confers jurisdiction to reopen the assessment. Therefore, post-1st April, 1989, power to reopen is much wider. However, one needs to give a schematic interpretation to the words "reason to believe" fa....