2015 (9) TMI 1062

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....were initiated and, after considering the matter, an assessment order was passed. The assessee, being aggrieved, filed an appeal, which was partly allowed. Thereafter, the assessee as well as the revenue filed an appeal before the Tribunal. The appeal of the assessee was allowed and the appeal of the revenue was dismissed. The Tribunal held that the jurisdictional condition for reopening the assessment beyond four years had not been fulfilled and that the assessment could not be reopened merely on change of the opinion without pointing out any failure on the part of the assessee to disclose fully and truly all material facts for the assessment. The revenue, being aggrieved by the order of the Tribunal, has filed the present appeal under Sec....

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.... (ii) The assessee had paid interest on these two loans as under:- On debentures Rs. 351.26 lakhs On Term loan Rs. 39.74 lakhs   Rs. 390.00 lakhs Thus, the part of this interest pertains to the investment in shares on which the assessee earned dividend income and disclosed in the returned income and assessed. The proportionate amount of interest is deductible while computing the dividend income as laid down u/s 52(i) & (iii) of I.T.Act 1961 as under:- 3.90 x 7.93 Crores = 0.91 crores 33.81 (iii) In view of the above facts, the dividend is assessable at Rs. 64 lakhs (1.55 -0.91 crores) and deduction u/s 80M was allowable at Rs. 63 lakhs (1.54-0.91 crores), which was allowed at ....

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....reasons to believe", but both the conditions are required to be fulfilled in the event the case falls within the ambit of the proviso to Section 148 of the Act. In the instant case, the case is covered by the proviso. The "reasons to believe" as recorded by the Assessing Officer does not aver that the assessee had failed to fully and truly disclose all material facts necessary for the assessment, which is a condition precedent for reopening the assessment after four years. The reason to believe only indicates that the reasons for reopening is based on the assessment records and the balance sheet. In our view, the foundational requirement for reopening an assessment beyond four years had not been fulfilled, as per the proviso to Section 1....