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2024 (3) TMI 823 - AT - Income TaxValidity of reopening of assessment - doctrine of merger - notice of reopening as issued beyond 4 years - deduction u/s 80IA - HELD THAT:- It emerges that in original assessment order AO denied impugned deduction as claimed by the assessee u/s 80IA - CIT(A) partly allowed the claim and the assessee was allowed deduction by AO. It is crystal clear that the order of Ld. CIT(A) was confirmed by Tribunal and revenue’s appeal was not admitted by Hon’ble High Court. This issue, thus, has attained finality. The first appellate order got merged with the orders of high authorities. By revisiting this issue in reassessment proceeding, in our opinion, would tantamount to disturbing the already concluded issue which could not be permitted. Therefore, the reassessment proceedings could not be upheld for this reason alone. Also perusal of recorded reasons would show that no new tangible material has come into the possession of Ld. AO which would indicated any escapement of income. There is no allegation in the reasons by Ld. AO that the assessee failed to disclose material facts which were necessary for assessment of income. This condition is mandatory condition since the reopening is beyond 4 years. It could also be seen that the reopening is merely at the behest of revenue audit objection. The prime requirement to reopen the case is that Ld. AO has reasons to believe that certain income had escaped assessment. The formation of belief should be based on tangible material. This condition, in the present case, has not been fulfilled. In the case of CIT vs. Shwing Stetter India P. Ltd. [2015 (6) TMI 497 - MADRAS HIGH COURT] held that for the purpose of assumption of jurisdiction u/s 147, the AO must have reason based on materials that there has been an income escaping assessment, which warranted assumption of jurisdiction under section 147. In the absence of any such material indicating escapement of income, the proceedings would be invalid. AO did not record any reason that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. When the AO had failed to record anywhere in his satisfaction or belief that the income chargeable to tax had escaped assessment on account of the failure of the assessee to disclose truly and fully all material facts necessary for assessment, the notice issued u/s 147 beyond the period of four years was wholly without jurisdiction and could not be sustained. This case law clearly supports the case of the assessee. Computation u/s 115JB - Mere omission on the part of Ld. AO to consider the same could not trigger reassessment proceedings unless there was any failure on the part of the assessee to make full disclosure thereof. The complete details, in this regard, was made available by the assessee in the computation of income. Therefore, no allegation of disclosure of true facts could be made against the assessee. We would hold that the reassessment proceedings were bad-in-law. The assessment order is accordingly quashed.
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