2012 (10) TMI 1010

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....e same, was not justified under the circumstances of the case.  2. The brief facts are that the assessee filed its return originally for the year 2001-02 on 29.10.2001, declaring a loss of approximately Rs. 11,000/-. The assessment was completed and confirmed on 19.03.2004, under Section 143(3) of the Act. On 31.03.2008, acting on the basis of material which the AO claimed, was furnished to him, notice under Section 148 was issued to the assessee, proposing to reopen the assessment. The AO recorded the following reasons why according to him, the assessee had not made full disclosure and its income had escaped assessment:  "Addl. Director of Investigation VI, New Delhi, had sent a list containing the details of transactions a....

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....7(a), (b) and (c) of the Income Tax Act, 1961.  I am, therefore, satisfied that the said income on accommodation entries as mentioned above has escaped assessment and accordingly after recording the above said reasons as laid down under the provisions of Section 148(2) of the Income Tax Act, propose to issue a notice to the above mentioned assessee u/s 148(1) of the IT Act, 1961."  3. The reassessment proceedings culminated in the assessment order dated 29.12.2008 whereby the amount of Rs. 4,98,47,560/- was added under Section 568. The assessee approached the appellate Commissioner who was of the opinion that there was no infirmity with the reassessment order. He rejected the appeal by order dated 18.08.2009. In these circum....

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....er dated 20.12.2002 including the share capital introduced by the assessee. The assessee has given reply vide his letter dated 16.01.2003. Therefore, the entire information was available with the Assessing Officer when original assessment was made on 19.03.2004. The assessing Officer on receipt of information from Investigation Wing had recorded reasons for reopening of assessment. From the reasons recorded as reproduced above, one may find that it does not contain any information based on which it could be said that there was a failure on the part of the assessee to disclose fully and truly material facts necessary for his assessment. In the absence of recording such facts, the reopening of assessment is bad in law. Hon'ble Delhi high Cour....

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....sessing Officer has also stated in the reasons recorded that commission income has escaped assessment within the provisions of Section 147(a), (b) and (c) of the Act. With effect from 01.04.1989, there is no provision in the Income Tax Act as in Section 147(a) or 147(b). However, Explanation 2 to Section 147 specifies the conditions under which income chargeable to tax shall be deemed to have escaped assessment. In the instant case, the assessment was framed u/s 143(3), therefore, if at all, clause (c) of Explanation 2 will be applicable according to which the income chargeable to tax shall be deemed to have escaped assessment if income chargeable to tax has been underassessed; or such income has been assessed at a low rate; or such income ....