Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (11) TMI 64 - ITAT MUMBAIReopening of assessment u/s 147 - Notice after expiry of four years from the end of the assessment year - HELD THAT:- In the reassessment proceedings, the AO referred the matter relating to international transactions to the Transfer Pricing Officer. After passing of draft assessment order, the assessee filed its objections to Ld Dispute Resolution Panel. After receiving directions from Ld DRP, the AO determined the total income under the normal provisions of the Act at Rs.4.72 crores and book profit at Rs.3.16 crores. Since the total income computed under normal provisions of the Act was more than the book profit, the AO raised tax demand on the total income computed under normal provisions of the Act. The assessee, inter alia, has challenged the validity of reopening of assessment before the Tribunal. We heard the parties first on this legal issue. As noticed earlier, the original assessment in the hands of the assessee was completed u/s 143(3) of the Act on 06-12-2015. AO has reopened the assessment by issuing notice u/s 148 of the Act on 31.3.2019, i.e., the reopening has been done after expiry of four years from the end of the assessment year. At this juncture, we may refer to the provisions of sec.147 of the Act, particularly the proviso thereto, which gives a protection to the assessee in the cases of reopening of assessment after expiry of four years from the end of the assessment year As reasons recorded by the assessee would show that the assessing officer has noticed alleged escapement of income only “on verification of records”. Hence there is merit in the contentions of Ld A.R that the AO did not bring any new material on record for forming belief that there is escapement of income. We noticed earlier that the reopening has been done after expiry of four years from the end of the assessment year and hence it is imperative for the AO to show that there was failure on the part of the assessee to disclose fully and truly all material facts, as stated in the proviso to sec.147 of the Act. The case of the assessee is that there was no failure on its part as alleged by the AO. We are of the view that the reopening of assessment is bad in law and hence the order passed by the assessing officer is liable to be quashed. Accordingly, we quash the order passed by the AO. Appeal filed by the assessee is allowed.
|