TaxTMI 
TaxTMI 
2009 (2) TMI 98
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....hat the assessment had been completed under Section 143(1) of the Act. For Assessment Year 2001-2002, return of income was filed on 31.10.2001. The respondent authority made an inquiry regarding cost of construction in relation to the projects and a detailed reply dated 11.01.2003 was filed on behalf of the petitioner. The details called for were supplied at item No.9 of the said reply. After considering the details and the explanation tendered by the assessee, the Assessing Officer did not accept the books of accounts and worked out net profit at the rate of 10% of receipts of a sum of Rs.1,10,86,447/-. This was carried in appeal and was confirmed by the Commissioner (Appeals) vide order dated 16.6.2003. The order made by Commissioner (Appeals) was further challenged by way of Second Appeal before the Tribunal and the action of Assessing Officer in rejecting the book result was also confirmed by the Tribunal. In so far as Assessment Year 2002-2003 is concerned, the return of income was filed on 21.10.2002. Once again an inquiry was made by the Assessing Officer on 19.08.2004 (Exhibit-B) calling for details of construction work including total plot area, total construction ar....
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....the failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment. Sd/- (S.G. NAIR) Income tax Officer, Ward 4(1), Baroda. Date: 5.2.2007 Place: Baroda." Heard learned counsel for the petitioner. It is submitted that in so far as the first Assessment Year is concerned, provisions of Section 142A of the Act could not have been invoked by the respondent authority to disturb an assessment completed prior to 30.9.2004. That as already held by this Court, provisions of Section 142A of the Act cannot be invoked in absence of any proceedings pending assessment. That the assessment for Assessment Year 2000-2001 was not pending on the date reference was made to the Departmental Valuation Officer, namely 2.12.2004, and therefore, on this count also the assessment could not be reopened. 7.1 In relation to the second and third years' under consideration namely Assessment Years 2001-2002 and 2002-2003, the Assessing Officer had made detailed inquiry and arrived at a conscious decision in relation to the cost of construction incurred by the assessee. Therefore there is no case for holding that there was any failure or omis....
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.... the same has traveled upto Tribunal and hence it could not be stated that the assessment had become final and conclusive on or before 30.9.2004. That in relation to third year, namely Assessment Year 2002-2003, the reopening was within the period of four years and the reference was made to Departmental Valuation Officer in relation to an assessment framed on 31.3.2005. Therefore, for this year, there was no hurdle, even as regards factum of disclosure being there or not. In so far as the first Assessment Year is concerned, namely 2000-2001, admittedly the return of income which was filed on 30.11.2000 was acknowledged on the same day and was not followed by any assessment order. Therefore applying the ratio of the Apex Court decision in case of Assistant Commissioner of Income-Tax Vs. Rajesh Jhaveri Stock Brokers P. Ltd. (Supra), it cannot be stated that there was any assessment. However, for invoking provisions of Section 142A of the Act, the first requirement of the provision is that where an estimate of the value of any investment referred to in section 69, or section 69A, or Section 69B of the Act is required to be made, the Assessing Officer may in his discretion, require ....
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....roduce the difference between expenditure recorded in the books of account and cost of construction estimated by the Departmental Valuation Officer; and then the reasons go on to state that because of such difference the assessee Company has under stated the cost of construction. In other words, it indicates that in fact the Assessing Officer had merely made reference to the Valuation Cell only on the basis of a generalized vague statement, which is then sought to be reinforced by the difference worked out by the Departmental Valuation Officer, without the facts in fact indicating, in the reasons recorded, as to what was the failure on the part of the assessee. Therefore for the second year in question, namely Assessment Year 2001-2002, the proposed reassessment cannot be sustained. There is no failure on the part of the assessee which would permit the Assessing Officer to assume jurisdiction beyond a period of four years from the last day of the assessment year, namely 31.3.2006, the relevant Assessment Year being Assessment Year 2001-2002. As noted, the reasons recorded for all the three years are common and no independent reasons are recorded for the third assessment year.....