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2024 (1) TMI 292 - AT - Income TaxReopening of assessment u/s 147/148 - failure to issue notice u/s 143(2) - assessee has sold jointly held immovable property admeasuring area 19627 sq. mtr. during F.Y.2011-12, relevant to A.Y.2012-13 - violation of provisions of section 50C as assessee is required to show the consideration received in the computation of capital gain, however, the assessee was failed to do so - assessee argued that provision of section 143(2)/143(3) of the Act, cannot be substituted with the provision of section 147/148 of the Act, hence reasons recorded by the Assessing Officer on same set of facts, which were disclosed by the assessee in the return of income, are not a valid reason to reopen the assessment. HELD THAT:- As provisions of section 143(2)/143(3) of the Act, have been substituted by the Income Tax Department with the provisions of section 147/148 of the Act, which is not acceptable in the eye of the law, hence reasons recorded by the Assessing Officer on same set of facts, which were disclosed by the assessee in the return of income filed u/s 139 of the Act, are not a valid reason to reopen the assessment. I also note that in the return of income, the assessee has disclosed the correct and full material facts about the disputed land, therefore on the same set of facts, the reopening of assessment is not allowed. We also note that assessee filed return of income for the assessment year under consideration and it is within the power of the Income Department to issue the scrutiny notice u/s 143(2) of the Act and conduct the scrutiny assessment on the assessee instead of reopening of the assessee`s case u/s 147/148. Therefore, reopening of assessment is not valid as the Income Tax Department has power to conduct the scrutiny assessment by issuing notice u/s 143(2) of the Act. After filing the return of income u/s 139 of the Act, if the Department does not conduct the scrutiny assessment, by issuing notice u/s 143(2) of the Act then in that situation, on same set of facts, which are narrated in the return of income filed by the assessee, the Department cannot reopen the assessment u/s 147/148 of the Act. The assesse has disclosed in the return of income filed by him, all material facts relating to disputed land, therefore the Department should have conducted the scrutiny assessment by issuing notice u/s 143(2) of the Act rather than reopening the assessment u/s 147/148 of the Act, which is not acceptable. If the Assessing Officer had any doubt about the correctness of the items disclosed in the return of income filed by him u/s 139 of the Act, and he wanted to verify the same, he ought to have issued notice u/s 143(2) of the Act within the time limit permissible under the proviso to above sub-section. Having failed to issue the notice u/s 143(2) of the Act, within the period of limitation, the provisions of section 147/148 cannot be invoked to get the extended time limit for verification of the correctness of the income returned. Based on these facts and circumstances, quash the reassessment proceedings. Appeal of assessee allowed.
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