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2014 (4) TMI 216 - HC - Income TaxValidity of reassessment of proceedings u/s 148 of the Act – Held that:- The reasons are recorded by the AO for reopening an assessment are the only reasons which can be considered - No substitution or deletion is permissible - No additions can be made to those reasons - No inference can be allowed to be drawn based on reasons not recorded – Relying upon Hindustan Lever Ltd. Vs. R B Wadkar, Asst Commissioner of Income Tax and Others [2004 (2) TMI 41 - BOMBAY High Court ] - all the documents had been filed along with the return of income on 29th August 2006 – all the material facts were disclosed by the assessee in relation to its acting as an agent of the Government of Maharashtra for the Navi Mumbai Project. There can be no doubt that there was no failure on the part of the assessee to disclose fully and truly all material facts in relation to it being appointed as an agent of the Government of Maharashtra for the Navi Mumbai Project - no income chargeable to tax had escaped from assessment for the A.Y. 2005-06 by reason of any failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment – the notice and the order are unsustainable and are liable to be set aside - There is no difference between the two – the assessee in several documents stated that it was “acting as an agent of the Government of Maharashtra” with respect to the Navi Mumbai Project - The statements were made to justify the assessee not having made any provision for the income of the Navi Mumbai project - This itself shows that the assessee's assertion was that it acted as an agent and made no provision for the income of the project. The initiation of reassessment proceedings u/s 147 of the Act was only based on a “change of opinion” which is impermissible under the Act - all disclosures were made by the assessee regarding its appointment as an agent of the Government of Maharashtra for developing the new town of Navi Mumbai - Merely because he had about six days, it cannot be presumed that he had not applied his mind to the issue - It would be unfair to the AO who made the Assessment Order, to speculate that he was either incapable of applying, or did not apply his mind to the very aspects in respect of which he sought details within six days - It would also be unfair to the assessee to permit such a contention to be raised in the absence even of any pleading. The Government Resolutions were disclosed - The relevant Government Resolutions were even referred to in the Assessment Order - It is difficult to see how the failure to disclose the judgment case can possibly justify reopening the assessment - The failure to disclose contemplated u/s 147 is of documents or particulars which are or even may be adverse to the assessee - The nondisclosure of such material would adversely affect the assessee and not the Revenue - The provisions of section 147 can operate only where the failure to disclose any material that is or even may be adverse to the assessee and not where it is only advantageous to the assessee – Decided in favour of Assessee.
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