TMI Blog2019 (6) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... . Therefore, reopening of assessment by issuance of notice u/s 148(2) on 27/3/2015 is bad in law and consequently the order passed in pursuance to such notice is also bad in law. - Decided in favour of assessee. - ITA No.670/LKW/2017 - - - Dated:- 10-10-2018 - Shri. N.S. Saini, Accountant Member And Shri Partha Sarathi Chaudhury,Judicial Member For the Appellant : Shri Swaran Singh, C.A. For the Respondent : Shri C. K. Singh, D.R. ORDER PER N.S. SAINI, A.M: This is an appeal filed by the assessee against the order of ld. CIT(A)-I, Kanpur dated 23/8/2017. Assessee has raised the following grounds of appeal:- 1) That the Ld. C.I.T. (Appeals)-l, Kanpur has erred in law and on facts in invoking section 50C of the I.T. Act, 1961 and thereby sustaining the addition of ₹ 12,62,800/- made by the Ld. Assessing Officer on a different basis. 2) That the Ld. C.I.T. (Appeals)-l, Kanpur has erred in law and on facts in sustaining the addition made by the Ld. A.O merely on the basis of erroneous report of the D.V.O, received subsequent to the completion of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has also filed an application for acceptance of modified ground No.12 of the appeal filed with form No.36 as well as acceptance of additional ground, which read as under:- 3. That the CIT(A)-1, Kanpur has erred in law and on facts in upholding reopening of the assessment under section 147 of the Income-tax Act, 1961 on the basis of purported Income Tax Inspector Report. 13. That the Ld. A.O. has erred in law and on facts in initiating proceedings under section 147 of the Income Tax Act, 1961 on the basis of erroneous facts having no live link with the material on record. Therefore, the impugned assessment order is illegal and void ab-initio. 14. That the Ld. C.l.T.-l. Kanpur has mechanically given the approval under section 151 of the Income Tax Act, 1961for issue of Notice under section 148 of the Income Tax Act, 1961, therefore, the impugned assessment order is illegal and void-abinitio and liable to be quashed. Reliance is placed on the judgment of jurisdictional High Court in the case of Mohan Dairy Vs. Union of India (2007) 163 Taxman 274 (All.) 3. The ld. D.R. had no objection to accepting m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... believe that the income amounting to ₹ 12,62,800/- has escaped assessment within the meaning of section 147 read with section 151 of Income Tax Act, 1961. As the case was completed u/s 143(3) and more than four years have elapsed, hence, previous sanction of Ld Commissioner of Income Tax - I, Kanpur is required to e accorded in this case before issuance of notice u/s 148. The same is being requested separately. 6. On the above stated facts, we find that in the instant case reopening of assessment has been made after expiry of four years from the end of relevant assessment year after passing original assessment order under section 143(3) on 31.10.2010. Proviso to section 147 states that where an assessment is made under section 143(3) of the Act, 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 disclose fully and truly all material facts necessary for his assessment for that assessment year. A bare perusal of the above recorded reasons shows that there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Hon ble Bombay High Court in the case of Sound Casting (P) Ltd. v. Dy. CIT reported in 250 CTR 119 (Bom.) (HC), has held that there is no allegation in the reasons which have been disclosed to the assessee that there was any failure on his part to fully and truly disclose material facts necessary for assessment and therefore reopening beyond four years was not valid. (A.Y. 2005-06). 11. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... coming the bar set up by the proviso to section 147. If this condition is not satisfied, the bar would operate and no action under section 147 could be taken. We have already mentioned above that the reasons supplied to the petitioner does not contain any such allegation. Consequently, one of the conditions precedent for removing the bar against taking action after the said four year period remains unfulfilled. In our recent decision in WelIntertrade 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 c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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