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2014 (4) TMI 123 - GUJARAT HIGH COURTReopening of assessment u/s 147 of the Act – Income escapement could not pointed out - Short levy of Tax – Held that:- The AO did not point out that income chargeable to tax had escaped assessment due to failure on the part of the assessee to disclose truly and fully all material facts - the entire formation of belief is founded on the material already on the record - in addition to there being no suggestion by the AO that income chargeable to tax had escaped assessment for the reason of the assessee failing to disclose truly and fully all material facts, demonstrably, from the record it emerges to the contrary - The notice for reopening having been issued beyond the period of four years from the end of the relevant assessment year and original assessment having been completed after scrutiny, the additional requirement emerging from proviso to Section 147 of the Act that income chargeable to tax had escaped assessment for the failure of the assessee to disclose truly and fully all material facts, must be satisfied. Any amendment in law, even with retrospective effect, would not authorize the AO to reopen the assessment previously framed after scrutiny beyond the period of four years from the end of the relevant assessment year unless the conditions laid down under the proviso to Section 147 of the Act are fulfilled – Relying upon Denish Industries Limited v. IncomeTax Officer [2004 (7) TMI 72 - GUJARAT High Court] - An assessee cannot be imputed with clairvoyance - When the return was filed, the assessee could not possibly have known that the decision on the basis of which cash compensatory support had been claimed as not amounting to the assessee’s income ceased to be operative by reason of retrospective legislation - there was no failure on the part of the assessee to disclose truly and fully all material facts - Therefore, the condition precedent for invocation of the powers under section 147 read with sections 148 and 149 was not fulfilled – thus, the notice is set aside – Decided in favour of Assessee.
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