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2021 (12) TMI 1096 - HC - Income TaxValidity of reopening of assessment u/s 147 - reassessment argued on non application of mind while granting the sanction under Section 151 of the Act and facts as recorded in the reasons are not correct - HELD THAT:- We are of the view that even in cases where the return of income has been accepted by processing u/s 143(1) of the Act, reopening of an assessment can only be done when the Assessing Officer has reason to believe that income chargeable to tax has escaped assessment. The mere fact that the return has been processed under Section 143(1) of the Act, does not give the AO a carte blanche to issue a reopening notice. Condition precedent of reason to believe that income chargeable to tax has escaped assessment on correct facts, must be satisfied by the Assessing Officer so as to have jurisdiction to issue the reopening notice. In the present case, the Assessing Officer has proceeded on fundamentally wrong facts to come to the reasonable belief/conclusion that income chargeable to tax has escaped assessment. Further, even when the same is pointed out by the Petitioner, the AO in his order disposing of the objection does not deal with factual position asserted by the Petitioner. Thus, it would be safe to conclude that the Revenue does not dispute the facts stated by the Petitioner. On the facts as found, there could be no reason for the AO to believe that income chargeable to tax has escaped assessment. It is settled law as held by the Division Bench of this court in German Remedies Ltd. vs. Deputy Commissioner of Income Tax [2005 (10) TMI 76 - BOMBAY HIGH COURT] that while granting approval it was obligatory on the part of the Principal Commissioner of Income Tax to verify whether there was any failure on the part of the assessee to disclose full and true relevant facts in the return of income filed for the assessment of income of that assessment order. The impugned notice and consequential order justifying reasons recorded are unsustainable The impugned notice and consequential order justifying reasons recorded are unsustainable - Decided in favour of assessee.
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