TaxTMI 
TaxTMI 
2019 (5) TMI 1206
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.... 1995-1996, 1988-1989, 1992-1993, 2003-2004, 2002-2003, 1990-1991, 1996- 1997, 1997-1998 and 2000-2001, respectively. 2.Learned counsel for the Appellant / Revenue has urged the following two contentions before us: (i)That the learned Tribunal has erred in upholding the orders passed by the learned Commissioner of Income Tax (Appeals) dismissing the Revenue's appeals as far as Re-assessment Proceedings under Sections 147 / 148 of the Act initiated against the respondent Bank are concerned, on the ground that such Re-assessment Proceedings have been initiated beyond the limitation of 4 years from the end of the relevant Assessment Years and the Assessing Authority had not, in the reasons recorded for such Re-assessment, indicated that there was a failure on the part of the Assessee to fully and truly disclose the relevant materials which resulted in such escapement of income and therefore, in the absence of any such stipulation in the reasons recorded for re-assessment, the Re-assessment Proceedings were held to be without jurisdiction and were liable to be quashed. He further submitted that the learned Tribunal has relied upon the decision of the Madras High Court i....
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....venue in nature. This claim of the Appellant was duly allowed in the assessment made under Section 143(3) after due consideration. Hence the opinion that is now being canvassed is mainly because another opinion has been formed on this matter. This new opinion is apparently on account of the decision rendered by the Supreme Court in the case of Vijaya Bank (187 ITR 541). However, as pointed out by the Appellant, even decisions of courts could no be a source or an antidote on matters which has been deliberated upon and closed earlier, as has been held by the Calcutta and Gujarat High Court in the decisions cited by the Appellant in his arguments. The Assessing Officer has not established that the Appellant had not disclosed all primary facts fully and truly at the time of assessment U/s.143(3) and the assessments were completed on scrutinizing the books of accounts along with relevant records and documents. The attempt of the Assessing Officer to assess the broken period interest was only on account of change of opinion and on that account the Assessing Officer was not competent to commence reassessment proceedings. Assuming for a moment there was escapement of income chargeable to t....
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....the appellant is allowed for statistical purposes." 4.The learned Income Tax Appellate Tribunal, after considering the findings of the Commissioner of Income Tax (Appeals) and after quoting brief reasons for reopening of all the Assessment Orders involved in the present cases, held that since the Assessing Authority had not stated that there was failure on the part of the Assessee to disclose fully and truly all the material facts, notices under Sections 147 and 148 of the Act were liable to be quashed in view of the decision of the Madras High Court in the case of Fenner (India) Limited v. Deputy Commissioner of Income Tax, reported in (2000) 241 ITR 672. The relevant portion of the order passed by the Tribunal in this regard, is quoted below for ready reference: "2.First, we will take up the assessee's appeal in ITA Nos.838, 839, 840, 841, 843, 844, 847, 848, 849 & 850/Mds/2014. Since in all these appeals, the issue is common, we consider the facts narrated in ITA No.838/Mds/2014. 3.The first common ground in these appeals is with regard to validity of reopening of assessment though reopening was made after the end of the four years from the assessment or....
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....en period interest 848/14 2001-02 20/11/2003 28/03/2008 i)Recognition of commission, exchange and brokerage on receipt basis. ii)Non inclusion of claims under ECGC & DICGC. 849/14 2002-03 01/03.2005 18/07/2008 i)Recognition of commission, exchange and brokerage on receipt basis. ii)Non inclusion of claims under ECGC & DICGC. iii)Non inclusion of stale drafts. 850/14 2003-04 31/03/2006 18/07/2008 i)Recognition of commission, exchange and brokerage on receipt basis. ii)Non inclusion of claims under ECGC & DICGC. As seen from the above chart, there is no allegation by the Assessing Officer that there is any failure on the part of the assessee to disclose all material facts for the purpose of assessment. The assessee having furnished all material facts for the purpose of assessment, even if an assessee erroneously placed higher deduction, in respect of issues raised by the Assessing Officer in his reasons recorded, it will not be a case of failure to disclose fully and truly all material facts and the notice u/s.148 issued to the assessee beyond the period of 4 years from the end of the relevant assessment year is liable....
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....7.We have heard both the parties and perused the materials on records. In these cases, the Assessing Officer has not pointed out any new material, which came into possession after completing the assessment u/s.143(3). In our opinion, after 1st April, 1989, the Assessing Officer has the power to reopen the assessment u/s.147, if the Assessing Officer has reason to believe that income has escaped assessment and if there is no tangible material to come to the conclusion that there is escapement of income; "mere change of opinion" cannot be a reason to reopen the assessment, as held by the Supreme Court in the case of CIT vs. Kelvinator India Ltd. (320 ITR 561). In these cases, issues are already considered by the Assessing Officer in his original assessments u/s.143(3). Being so, he cannot relook the same records so as to make additions, which amounts to double taxation. Accordingly, we are inclined to annul all the assessments made u/s.147 of the Act." 6.Having heard the learned counsel for the Appellant Revenue and upon perusal of the order passed by the Tribunal, we are of the considered opinion that no substantial question of law arises in the present case and the orders passed....
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....at any income chargeable to tax has escaped assessment for that assessment year. However when such power is invoked after the expiry of the period of four years from the end of the assessment year, such limitation can be overcome only if the Assessing Authority records the reason that there has been failure on the part of the Assessee to disclose fully and truly all the material facts and such failure on the part of the Assessee has resulted in the escapement of income taxable in his hands. The relevant portion from the aforesaid judgment is quoted below for ready reference: "The pre-condition for the exercise of the power under section 147 in cases where power is exercised within a period of four years from the end of the relevant assessment year is the belief reasonably entertained by the AO that any income chargeable to tax has escaped assessment for that assessment year. However, when the power is invoked after the expiry of the period of four years from the end of the assessment year, a further precondition for such exercise is imposed by the proviso, namely, that there has been a failure on the part of the assessee to make a return under section 139 or in response to....
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.... the failure on the part of the Assessee to fully and truly disclose the relevant materials during original assessment proceedings resulting in such escapement of income. Either the reasons so recorded on the face of it attributes such failure of the Assessee or the Assessing Authority so clearly states in the reasons recorded and conveyed by him that there has been failure on the part of the Assessee to fully and truly disclose the relevant materials and thus on account of such failure, the income has escaped assessment at the time of the original assessment and upon such satisfaction being recorded only, the Assessing Authority can proceed further for re-assessment under Sections 147 / 148 of the Act. Instead of any Court of law taking up this exercise of drawing the inference as to whether the reasons recorded by the Assessing Authority giving jurisdiction to re-assess is on account of the failure of the Assessee to disclose fully and truly, it would be much more appropriate for the Assessing Authority himself to record the reasons in that manner, because the Proviso to Section 147 clearly so stipulates and gives the jurisdiction to re-assess beyond four years at the end of t....
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....lone 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 re-open the assessment. Therefore, post-1st April, 1989, power to re-open is much wider. However, one needs to give a schematic interpretation to the words "reason to believe" failing which, we are afraid, Section 147 would give arbitrary powers to the Assessing Officer to re-open assessments on the basis of "mere change of opinion", which cannot be per se reason to re-open. We must also keep in mind the conceptual difference between power to review and power to re-assess. The Assessing Officer has no power to review; he has the power to re-assess. But re-assessment has to be based on fulfilment of certain precondition and if the concept of "change of opinion" is removed, as contended on behalf of the Department, then, in the garb of re-opening the assessment, review would take place. One must treat the concept of "change of opinion" as an in-built test to chec....