2017 (3) TMI 38 - BOMBAY HIGH COURT - Income Tax

Head Note / Extract:
Reopening of assessment - reason to believe - Held that:- It is a settled position that even where an assessment has been only processed under Section 143(1) of the Act, the reopening notice must satisfy the test of having reason to believe that the income chargeable to tax has escaped assessment (see Asst. CIT v/s. Rajesh Jhaveri Stock Brokers (P)Ltd. (2007 (5) TMI 197 - SUPREME Court). - Prima facie determination of income escaping assessment would indicate application of mind to arrive at the reason to believe that income chargeable to tax has escaped assessment. This Court in Vodafone India Services Pvt. Ltd. v/s. CIT [2014 (10) TMI 278 - BOMBAY HIGH COURT] has taken a view that the share premium being on capital account cannot be subjected to tax as income. HC granted stay on further proceedings till final disposal of the appeal.