TMI Blog2010 (5) TMI 709X X X X Extracts X X X X X X X X Extracts X X X X ..... initiated under section 147 of the Act as being barred by limitation and beyond the Assessing Officer's jurisdiction. The relevant facts giving rise to this issue may be summarised as under : In this case, the assessee filed original return of income on November 28, 2000 declaring total income at Rs. 2,37,64,670. The original assessment was then completed under section 143(3) determining total income at Rs.3,00,51,422. Thereafter, the assessment order was rectified vide order under section 154/143(3) revising the total income at Rs. 3,06,69,583, which was subsequently reduced to Rs. 2,76,38,987 on giving appeal effect to the Commissioner of Income-tax (Appeals)'s order. The Assessing Officer's order giving appeal effect to the Commissioner of Income-tax (Appeals)'s order is under section 250/143(3) dated December 10, 2004. Thereafter, the Assessing Officer noted that on perusal of the return of income and annexure thereto, it was revealed that for the relevant assessment year, the deduction under section 80HHC was allowed to the assessee without reducing the amount of deduction claimed and allowed under section 80IB as required by section 80-IA(9), which is also applicable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 147 would not come on the way for the Assessing Officer to initiate reassessment proceedings under section 147 of the Act, inasmuch as, the Assessing Officer had sufficient material available to entertain a reasonable belief that income had escaped assessment in so far as the assessee's claim of deduction under section 80HHC is concerned. Still aggrieved, the assessee is in appeal before us. We have heard both parties and have carefully perused the orders of the authorities and we have gone through the materials available on record. In the present case, it is not in dispute that the original assessment was completed under section 143(3) of the Act vide order dated March 27, 2003. We have gone through the assessment order dated March 27, 2003 originally made by the Assessing Officer under section 143(3) of the Act, and found that the issue with regard to the deduction under section 80HHC was considered by the Assessing Officer. In paragraph (a) at page 2, the Assessing Officer has mentioned about the claim made by the assessee at Rs. 94,13,277 under section 80HHC of the Act. After examining the assessee's claim made under section 80HHC, the Assessing Officer allowed cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The notice issued under section 148 is dated March 7, 2006, which is beyond the period of four years from the end of the relevant assessment year 2000-01 in question. Therefore, the validity of proceedings initiated under section 147 of the Act is to be adjudged from the standpoint of proviso to section 147 of the Act. On reading the proviso to section 147 of the Act, it is clear that in the cases where an assessment has been made under section 143(3) of the Act, an action under section 147 of the Act can be taken after expiry of four years from the end of the relevant assessment year if any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee (i) to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or 148, or (ii) to disclose fully and truly all material facts necessary for his assessment for that assessment year. The proviso to section 147 has carved out an exception from the main provision of section 147 of the Act. In the present case, it is nobody's case that the assessee has failed to make a return under section 139 of the Act or any other section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to disclose fully and truly all facts necessary for his assessment. It is not the case of the Assessing Officer made out in the reasons recorded that there was a failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. Therefore, the initiation of reassessment proceedings under section 147 of the Act and issuance of notice under section 148 dated March 7, 2006 after the expiry of four years from the end of the relevant assessment year, in the present case, is clearly hit by the proviso to section 147 of the Act, which make the proceedings initiated by the Assessing Officer as without jurisdiction inasmuch as without satisfying the conditions mentioned in the proviso to section 147 of the Act, the Assessing Officer has no power to take action under section 147 of the Act, after expiry of four years from the end of the relevant assessment year when there was a regular assessment already made under section 143(3) of the Act. In support of the view we have taken above, a gainful reference may be made to a decision of the hon'ble jurisdictional Delhi High Court in the case of Haryana Acrylic Manufacturing Co. Ltd. v. CIT [2009 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplied to the petitioner, there is no whisper, what to speak of any allegation, that the petitioner had failed to disclose fully and truly all material facts necessary for assessment and that because of this failure there has been an escapement of income chargeable to tax. Merely having a reason to believe that income had escaped assessment, is not sufficient to reopen assessments beyond the four year period indicated above. The escapement of income from assessment must also be occasioned by the failure on the part of the assessee to disclose material facts, fully and truly. This is a necessary condition for overcoming the bar set up by the proviso to section 147. If this condition is not satisfied, the bar would operate and no action under section 147 could be taken. We have already mentioned above that the reasons supplied to the petitioner does not contain any such allegation. Consequently, one of the conditions precedent for removing the bar against taking action after the said four year period remains unfulfilled. In our recent decision in Wel Intertrade P. Ltd. v. ITO [2009] 308 ITR 22 (Delhi) we had agreed with the view taken by the Punjab and Haryana High Court in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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