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2015 (8) TMI 275 - HC - Income TaxValidity of reopening of assessment - petitioner contend that after four years of the assessment year 2007-08, the second respondent issued notice dated 26.03.2014 under Section 148 seeking to reopen the assessment, without any tangible materials and without assigning reasons - assessee had not furnished the true information regarding its status and the details regarding payment of dividend and not disclosed full and true material facts on the claim of deduction under Section 10B - Held that:- It is not in dispute that the scrutiny assessment under Section 143(3) was completed on 16.12.2010 and the time limit of four years to invoke Section 147 of the Act is till 31.03.2014. It is not in dispute that the impugned notice under Section 148 has been issued on 26.3.2014 by the second respondent proposing to reassess the income for the assessment year 2007-08 since he had reason to believe that the income chargeable to tax for the said assessment year has escaped assessment within the meaning of Section 147 of the Act. Therefore, when it is clear that the reassessment resorted to by the second respondent is within the period of four years Of-course, it is true that no fresh material was available with the second respondent to proceed with the reassessment proceedings. However, it is to be noted that the second respondent had categorically mentioned the reasons as stated supra, by which, he had a reason to believe that the income chargeable to tax has escaped assessment inasmuch as the specific case of the Revenue is that the petitioner has not disclosed fully, truly all necessary material to enable the department to assess the income correctly regarding the particulars, viz., the petitioner company is not a domestic company, tax rate applicability on dividend distributor, expenses incurred out of EEFC Fund and Board of approval to claim deduction under Section 10B. Therefore, there is a failure on the part of the petitioner to disclose the above material facts and in such circumstances, the Assessing Officer has rightly initiated the reassessment proceedings on the basis of available material on record, which was specific, relevant and considerable, and after recording the reasons for his own belief that in the original assessment proceedings, the petitioner/assessee had not disclosed the material facts truly and fully and therefore income chargeable to tax had escaped assessment. In my opinion, he, therefore, correctly invoked the provisions of Sections 147 and 148 of the Act. Having carefully examined the reasons given by the Assessing Officer for re-opening the assessment in the present case, this Court is of the view that the said reasons are relevant and material and have a bearing on the matters in regard to which, the Assessing Officer has formed a reason to believe that the income chargeable to tax has escaped assessment and there is, absolutely rational and intelligible nexus between the reasons and the belief entertained by the Assessing Officer. In the present case, though the petitioner has given explanation elaborately in regard to the reasons relied on by the Assessing Officer for reopening the assessment and demonstrated the circumstances under which, there was no income chargeable to tax has escaped assessment, this Court is not supposed to decide the same since the issue involved in this Writ Petition is whether the Assessing Officer was right in reopening the assessment. To this extent, this Court has answered accordingly. - Decided against assessee.
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