2003 (9) TMI 55

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....t, 1961, in which the following questions have been referred to us for our opinion: "1. Whether, on the facts and in the circumstances of the case the Appellate Tribunal was justified in law in holding that the audit report amounted to 'information' within the meaning of section 147(b) of the Income-tax Act, 1961, on the basis of which the assessment could be validly reopened by the Income-tax ....

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....fficer allowed loss on the sale of certain machinery but refused to allow loss on the sale of the kiln on the ground that the same will be allowed when the sale was completed. In the assessment year 1975-76 (the relevant assessment year), the Income-tax Officer computed the loss on the sale of the kiln at Rs. 34,261 being the difference between the sale price and its written down value. The assess....

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....what the audit party pointed out to the Income-tax Officer was that the kiln was not used at all in the accounting year and the loss had been set off on the basis as if the kiln was used. The Tribunal was of the view that the Income-tax Officer was not aware of the factual aspects about which the audit gave information and hence it was not a case of mere change of opinion. As regards the first ....

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....1980] 124 ITR 316 (All), etc. Similarly, the communication of the law by the audit to the Income-tax Officer is also information vide CIT v. Abhoji Rao Phalke [1985] 156 ITR 604 (MP); Bharat Plywood and Timber Products Ltd. v. CIT [1992] 198 ITR 692 (Ker), etc. Since the audit only brought certain facts to the knowledge of the Income-tax Officer, it was certainly information under section 147(b....