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2015 (1) TMI 569 - AT - Income TaxValidity of reassessment u/s 147 – Income escapement – Notice u/s 148 issued – Held that:- A valid return of income submitted by assessee u/s. 139(4) of the Act was pending assessment - AO is empowered to issue notice u/s. 143(2) of the Act as the time limit has not expired - The AO cannot ignore a valid return filed under various provisions of section 139 of the Act and any notice issued u/s. 148 of the Act read with section 147 of the Act, ignoring such return, is invalid – relying upon Smt. Sova Sarkar Vs. [1977 (6) TMI 1 - CALCUTTA High Court] - There can be no doubt that when there is no question as to the validity of a return filed by an assessee, the ITO has to complete the assessment in accordance with s. 143 of the Act and before such completion he would not have any jurisdiction to ignore the return and to issue a notice u/s 148 – u/s 147(a) of the Act one of the grounds which enables the ITO to assess or reassess the income of an assessee by issuing a notice u/s 148 is that the ITO has reason to believe that, by reason of the omission or failure on the part of the assessee to make a return under s. 139 of the Act for any assessment year, income chargeable to tax has escaped assessment for that year - The assessee filed returns, but they did not include certain particulars regarding the profits and gains of his business. It were signed and verified by the assessee - when a return has been filed by an assessee, it cannot be ignored by the ITO and he will have no jurisdiction to issue a notice u/s 148 without completing the assessment on the return filed by the assessee - Even though a return is invalid in the sense that it is not correct and complete within the meaning of s. 139 of the I.T. Act, 1961, the ITO cannot ignore or disregard the same for the purpose of issuing a notice under s. 148 of the Act, unless the return can be regarded as not a return in the eye of law - the ITO acted on the returns filed by the appellant, issued notices u/s 143(2) and heard the appellant u/s 143(3), but without completing the assessments he took recourse to reopen the assessments u/s 147 by issuing the notices u/s 148 of the Act - the notice issued u/s. 148 of the Act for initiation of reassessment proceedings u/s. 147 of the Act for escapement of income is bad in law ans is set aside – Decided in favour of assessee.
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