Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2011 (4) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2011 (4) TMI 823 - HC - Income TaxReopening of Assessment - set off of such carried forward depreciation against short term capital gain - Held that:- AO has reopened the assessment under an honest belief that income chargeable to tax has indeed escaped assessment, however, if such honest belief is entertained on an erroneous interpretation of the relevant statutory provisions, the assessee should not be required to face the rigours of reassessment merely because the Assessing Officer entertains an honest belief - Such honest belief should be based upon the material on record and should, in fact, give rise to the belief that income has escaped assessment - Therefore, it is not possible to state that any income chargeable to tax has escaped assessment as is sought to be contended on behalf of the respondent Assessing Officer who has reopened the assessment on the ground that the unabsorbed depreciation for assessment years 1993-94 to 1996-97 could not be set off against short term capital gain in the year under consideration - The reopening by the AO is based upon an erroneous interpretation of the provisions of sub-section (2) of section 32 and in fact no income chargeable to tax can be stated to have escaped assessment - thus the very assumption of jurisdiction by the AO under section 147 is, therefore, invalid - In favour of assessee.
|