2022 (1) TMI 830

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. According to Ld. A.R., in the reasons recorded by the AO to reopen the assessment which has been reproduced by the AO in the impugned assessment order, it can be seen that the AO has not made any whisper about any failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. So according to the Ld. A.R., the essential condition precedent as stipulated in the first proviso to Section 147 of the Act being not fulfilled, the AO lacks jurisdiction to reopen the scrutinized assessment of assessee for A.Y. 2010-11. For this legal proposition, the Ld. A.R. cited the decision of the Hon'ble Bombay High Court in the case of M/s. Sound Casting Pvt. Ltd. vs. DCIT reported in 250 CTR 189 (Bom) and the decision of the Hon'ble Delhi High Court in the case of M/s. Haryana Acrylic Manufacturing Co. vs. CIT & Ors. reported in (2009) 308 ITR 38 (Del) as well as the jurisdictional High Court i.e. Calcutta High Court in the case of M/s. Philips Carbon Black Ltd. vs. ACIT & Ors. 2019 (3) TMI 993 (Cal) dated 13.03.2019. According to Ld. A.R. ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... it has not been the submission of the Revenue that there was any suppression of material facts on the part of the Petitioner. The Hon'ble Delhi High Court in the case of Haryana Acrylic Manufacturing Co. v. Commissioner of Income-Tax and Anor. reported in [2009] 308 ITR 38 (Delhi) has held as follows: "26. Viewed in this light, the proviso to section 147 of the said Act, carves out an exception from the main provisions of section 147. If a case were to fall within the proviso, whether or not it was covered under the main provisions of section 147 of the said Act would not be material. Once the exception carved out by the proviso came into play, the case would fall outside the ambit of section 147. 27. Examining the proviso [set out above], we find that no action can be taken under section 147 after the expiry of four years from the end of the relevant assessment year if the following conditions are satisfied: (a) an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year; and (b) unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the pa....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....r removing the bar against taking action after the said four year period remains unfulfilled. In our recent decision in Wellntertrade Private Ltd. (supra) we had agreed with the view taken by the Punjab and Haryana High Court in the case of Duli Chand Singhania (supra) that, in the absence of an allegation in the reasons recorded that the escapement of income had occurred by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment, any action taken by the Assessing officer under section 147 beyond the four year period would be wholly without jurisdiction. Reiterating our view-point, we hold that the notice dated 29.03.2004 under section 148 based on the recorded reasons as supplied to the petitioner as well as the consequent order dated 02.03.2005 are without jurisdiction as no action under section 147 could be taken beyond the four year period in the circumstances narrated above." 4. In the light of the aforesaid legal propositions laid by the Hon'ble High Court including jurisdictional High Court, the Ld. A.R. drew our attention to the reasons recorded by the AO to reopen the assessment which has been reprodu....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....elf. Thereafter the Ld. A.R. drew our attention to Section 147 of the Act relevant part of which reads as under: [Income escaping assessment]. 147. If any income chargeable to tax, in the case of an assessee, has escaped assessment for any assessment year, the Assessing Officer may, subject to the provisions of sections148 to 153, assess or reassess such income or recompute the loss or the depreciation allowance or any other allowance or deduction for such assessment year (hereafter in this section and in sections148 to 153 referred to as the relevant assessment year). Provided that where an assessment under sub-section (3) of Section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of Section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year. [Emphasis given by us] From a plain reading of Se....