TaxTMI 
TaxTMI 
2017 (10) TMI 320
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.... the Assistant Commissioner, Income Tax, Central Circle-1, Kanpur. It appears from the pleadings that in the relevant assessment year, petitioner had filed return on 25.09.2008 under Section 139 of the Act. The return so filed was processed by the Assessing Officer under Section 143(1) of the Act on 10.07.2009. Finally, an order of assessment was passed on 31.12.2009 under Section 143(3) of the Act. Thereafter, on the basis of some information received, the Assessing Officer formed an opinion that certain income of the petitioner has escaped assessment. Accordingly, notice under Section 148 of the Act was issued on 31.03.2015 (wrongly mentioned as 30.03.2015). The petitioner asked for supplying the reasons to believe for forming such an opinion for re-opening the assessment. The Assessing Officer supplied the reasons vide letter dated 21.08.2015. Apart from other things, it records that search and seizure operations were carried out on 21.01.2015 at Jodhpur, where the statement of one Jagdish Prasad Purohit was recorded, who accepted that his associates were working as dummy directors in various companies and that all the affairs of all those companies are being managed by him. ....
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....believe that the income of the assessee has escaped assessment and in the event, the proceedings for re-assessment are drawn after four years but before completion of six years from the end of the relevant assessment year, the Assessing Officer has to be further satisfied that there is a failure on the part of the assessee to file return or to disclose fully and truly all material facts necessary for assessment. In the case at hand, we are basically concerned with the condition regarding full and complete disclosure of all material facts necessary for assessment. In view of the above, as admittedly the proceedings for re-assessment were started after the expiry of four years, it was incumbent upon the Assessing Officer to have satisfied that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. The reasons to believe as supplied to the petitioner vide letter dated 21.08.2015 filed as annexure 7 records that Jagdish Prasad Purohit provided a list of 246 companies, controlled and managed by him and that the petitioner company had received a sum of Rs. 14,70,15,000/- as security premium amount during the assessment ye....
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.... years. In the case of M/s Tikaula Sugar Mills Limited Vs. CIT, Muzaffar Nagar decided by the Division Bench of this Court on 16.10.2012, the only thing which has been said is that when the entire material is disclosed in the accounts, which were accepted and the assessment was finalized, there could be no ground to re-open the assessment on the assertion that the income has escaped assessment. It also lays down that the Assessing Officer has to apply his mind to the information, if any, collected for the purposes of forming his opinion as to the escapement of the income. In Jagran Prakashan Ltd. Vs. Commissioner of Income Tax, (2014) 361 ITR 534 (Alld), it has been held that where Assessing Officer fails to record that there was failure on the part of the assessee to disclose fully and truly all the material facts necessary for assessment and the proceedings for the assessment were finalized under Section 143(3) of the Act, it cannot be said that the petitioner has failed to disclose all the material facts relevant for the assessment to sustain an action under Section 148 of the Act. This apart, much reliance has been placed upon the decision of the Supreme Court in the case of....
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....t as there was complete disclosure of all material facts necessary for assessment on the part of the assessee and the assessment order was passed under Section 143(3) of the Act after making necessary scrutiny and inquiry, it would not be a case for re-assessment for failure to satisfy the second condition. In Sound Casting (P) Ltd. Vs. Deputy Commissioner of Income Tax (2013) 33 Taxmann.com 374 Bombay, it has been held that where there is no allegations in the reasons to believe that there was any failure on the part of the assessee to fully and truly disclose the material facts necessary for assessment, re-opening of the assessment beyond the period of four years would not be permissible. The consideration of all the aforesaid authorities, viz-a-viz the provisions of Sections 147 to 153 of the Act makes it abundantly clear that for initiating the proceedings for re-assessment beyond the period of four years from the end of the relevant assessment year, it is also mandatory that the income chargeable to tax must have escaped assessment for failure on the part of the assessee to file return or to disclose fully and truly all material facts necessary for assessment. Thus, non-dis....
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.... In the said case also, the return filed by the assessee was processed and was finalized after due scrutiny and verification. The Apex Court laid down the following two essential conditions for the re-assessment under Section 147 of the Act : (1) The Income Tax Officer must have reason to believe that the income had escaped assessment and ; (2) he must have reason to believe that such escapement was occasioned by a reason of omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. It was held that both these conditions must coexist in order to confer jurisdiction upon the Income Tax Officer to proceed or to initiate the proceedings under Section 148 of the Act. Now, applying the above conditions to the facts and circumstances of the case, the Supreme Court held that where the transaction itself on the basis of subsequent information was found to be bogus, mere disclosure of the transaction at the time of original assessment proceedings cannot said to be a disclosure of the "true and full facts" and in that case, the Income Tax Officer would have jurisdiction to re-open the concluded assessment for the relevant ye....