TaxTMI 
TaxTMI 
2023 (12) TMI 216
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....e of opinion which has been consistently held to be a circumstance / ground which does not enable reassessment under Section 147 read with Section 148 of the Income Tax Act, 1961 (hereinafter referred to as "Act"). 2. The petitioner herein is the Director of a Company called Vinplex India Pvt. Ltd. and was assessed to tax in PAN No.APFPS2992P presently under the jurisdiction of the National e-Assessment Centre, Delhi. The petitioner filed its return of income for the Assessment Year 2014-15 on 27.07.2014, declaring a Gross Total Income of Rs. 54,19,094/-. The petitioner's case was selected for scrutiny under CASS and a notice under Section 143(2) of the Act was served on the petitioner on 15.09.2015 informing the petitioner that there are certain aspects with the return requiring clarification. There was a change of the office of the assessing officer, thus another notice dated 16.08.2016 calling upon the petitioner to appear and furnish certain information which inter-alia included the following: "5. Details of transactions of movable/ immovable property during the Financial Year 2013-14 along with copy of sale deed and purchase deed. 6. Reason for the var....
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....5,613 Total LTCG Rs. 1,01,60,974 Less: Exemption u/s 54E on investment in a residential house Rs. 1,10,00,000 However in the Return of Income for AY 2014-15 filed on 27.07.2014 the assessee has claimed exemption u/s 54F amounting to Rs. 1,10,00,000. The assessee has not submitted any corroborative evidence to prove his claim of exemption during assessment proceedings. Therefore, the claim of exemption u/s 54F is required to be disallowed and brought to tax." 3.2. The learned counsel for the petitioner submitted that neither the notice nor the reasons for reopening contain any finding / allegation that the income chargeable to tax has escaped assessment by reason of the failure on the part of the assessee / petitioner to disclose fully and truly all material facts necessary for assessment, which is a condition precedent for invoking extended period of limitation i.e., beyond four years from the relevant assessment year. Secondly, as seen from the above extracts the petitioner even before making the original assessment had submitted that he had sold two land properties and received the sale consideration by way of cash and has offered the same under short term....
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....extracted below: --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, unless any income chargeable to tax has escaped assessment for such 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 the assessment year.-- A reading of the above provision would show that while it is open to the Assessing Officer to invoke Section 147 of the Act within a period of four years, if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment, subject to the provisions of Sections 148 to 153 of the Act. The proviso to Section 147 of the Act, enables the Assessing Officer to make reassessment even after the expiry of four years from the end of the relevant assessment year, but, within six years from the relevant assessment....
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....ch warrants exercise of that power. In the present case, though admittedly the power to reassess has been exercised by invoking the extended period of limitation in terms of the proviso to Section 147 of the Act, there is no recording of the existence of the circumstances, viz., failure to disclose fully and truly all material particulars which would confer jurisdiction to proceed / initiate reassessment proceeding beyond four years and within six years. In this regard, it may be relevant to refer to the following judgments to appreciate the relevance and importance of existence of jurisdictional facts and an application of mind as to its existence by the authority concerned before assuming jurisdiction. It is relevant to extract the judgment of the Hon-ble Supreme Court in the case of Arun Kumar v. Union of India reported in (2007) 1 SCC 732, which reads as under: --74. A ?jurisdictional fact? is a fact which must exist before a court, tribunal or an authority assumes jurisdiction over a particular matter. A jurisdictional fact is one on existence or non-existence of which depends jurisdiction of a court, a tribunal or an authority. It is the fact upon which an administra....
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.... a finding of fact; for, unless the land can be held not to be part of a park or not to be required for amenity or convenience, there is no jurisdiction in the borough council to make, or in the Minister to confirm, the order." (emphasis supplied) 11. While on the question of existence or otherwise of jurisdictional fact which would enable the authority to invoke the extended period of limitation of six years for reassessment, it may also be relevant to note that the question of limitation has been understood to be one involving jurisdiction even under the Excise Law and in the absence of finding of the existence of the circumstances enabling the invoking of the extended period, it has been held by the Hon-ble Supreme Court that the issuance of Show Cause Notice itself is impermissible. In this regard, it may be relevant to refer the judgment in the case of ITW Signode India Ltd v. CCE reported in (2004) 3 SCC 48, wherein, after extracting the judgment of the Hpn-ble Supreme Court in the case of Easland Combines, the Court proceeded to conclude as under: "68. Even in Easland Combines [(2003) 3 SCC 410 : (2003) 152 ELT 39] this Court held: (SCC pp. 424-25, para ....
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....e of the above circumstance warranting invocation of the extended period in terms of the proviso to Section 147 of the Act would vitiate the entire proceedings. In this regard, it may be relevant to refer to the following judgements: a) Duli Chand Singhania vs ACIT (269 ITR 192): ...that the reasons recorded for issue of notice showed that the satisfaction recorded therein wes merely about the escapement of income. There was not even a whisper of an allegation that such escapement had occurred by reason of failure on the part of the assessee to disclose fully and truly all the material facts necessary for his assessment. Absence of this finding which is a "sine qua non" for assuming jurisdiction under section 147 of the Act in a case falling under the proviso thereto, made the action taken by the Assessing Officer wholly without jurisdiction. The notice was not valid and was liable to be quashed. " (emphasis supplied) b) Commissioner of Income Tax vs. Eigi Ultra industries Ltd. (296 ITR 573): "...the reopening of the assessment under s. 148 beyond the period of four years at the end of the relevant assessment year can be sustained only if it i....