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2010 (6) TMI 17 - HC - Income TaxDisallowance u/s 14A – Reassessment – income escaping assessment - During the course of the assessment proceedings, the Assessing Officer issued a notice to the assessee on 11 October 2004 seeking inter alia details of dividend claimed to be exempt under Section 10(33) without considering the disallowance under Section 14A. - An assessment order was passed under Section 143(3) on 10 March 2005 determining the total income at Rs.3031.14 Crores. No disallowance was made under Section 14A. On 22 March 2007 a revisional order was passed under Section 263 by the Commissioner directing the First Respondent to consider the applicability of Section 14A. No order was passed by the Assessing Officer to give effect to the order passed by the revisional authority. - However, on 26 February 2009 a notice was issued to the Petitioner seeking to reopen the assessment for Assessment Year 2002-03 on the ground that there was reason to believe that income chargeable to tax had escaped assessment within the meaning of Section 147. Held that: . Where an assessment has been made under sub section (3) of Section 143 for the relevant Assessment Year, no action can be taken after the expiry of four years from the end of the relevant Assessment Year unless inter alia there has been a failure of the assessee to disclose fully and truly all material facts necessary for his assessment for that Assessment Year. This is a condition precedent to a valid exercise of the statutory power to reopen an assessment after the expiry of four years from the end of the relevant Assessment Year. Evidently this condition has not been fulfilled. The record of the Court would clearly show that there was a full and true disclosure by the assessee of all the material facts and that the Assessing Officer has brought his mind to bear upon the issue on which the assessment is now sought to be reopened. – Notice seeking reopening of an assessment set aside.
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