TMI Blog2014 (4) TMI 479X X X X Extracts X X X X X X X X Extracts X X X X ..... basis of which the entire notice of reopening is founded, lacks legal validity, surely, such notice cannot be sustained - additions sought to be made by the assessing officer through this process of reopening of the assessment previously closed after scrutiny has not been approved by the Court – thus, the reopening of the assessment is set aside – Decided in favour of Assessee. - Special Civil Application No. 25089 of 2006, Special Civil Application No. 25090 of 2006 - - - Dated:- 24-3-2014 - Akil Kureshi And sonia Gokani,JJ. For the Appellants : Mr. J. P. Shah With Mr. Manish J. Shah, Adv. For the Respondent : Mr. K. M. Parikh, Adv. JUDGMENT (Per : Honourable Mr. Justice Akil Kureshi) 1. These petitions are file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Narmada Valley Fertilizers Co.Ltd. reported in [2013] 356 ITR 460 (Guj) rejected the Revenue s appeal. We are informed that against such judgment, the Revenue has approached the Supreme Court, however, so far, no decision is rendered. 5. While on one hand, the assessing officer was pursuing this issue in the regular assessment, but failed to make any additions, as seen above, for the assessment year 2001-02, he issued notice for reopening on the same ground. Such notice was issued on 21.3.2006. Thus, within a period of 4 years from the end of relevant assessment year, he supplied the reasons recorded for issuing such notice, which read as under:- In this case, return of income declaring total income at Rs.54,30,57,988/- was filed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of its failure to disclose all material details like cost of project, necessary for the purpose of working out admissible deduction. Thus, income of Rs.74,23,000/- has escaped assessment by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment. 6. The petitioner raised several objections to the notice for reopening under communication dated 10.10.2006. Such objections were, however, rejected by the assessing officer by order dated 27.10.2006. Hence, the petition. 7. On identical grounds, the assessing officer also issued notice for reopening of assessment for the assessment year 2002-03 which notice is impugned in the Special Civil Application No.25090 of 2006. 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make such disallowance precisely on this ground of the petitioner s claim for deduction under section 35D of the Act exceeding the limit laid down in sub-section(3) thereof. In such year also after putting the assessee to notice, he had restricted claim of Rs.13.50 lakhs as against claim of Rs.87.73 lakhs put-forth by the assessee in the return. The Tribunal reversed the assessing officer s view on the ground that having accepted the claim of this nature, which is to enure for several years, in the first year of occurrence of the same could not be abruptly withdrawn without disturbing the allowances made in the earlier year. It was in this background when the Revenue approached the High Court, Revenue s appeal was dismissed in following ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, the Income-tax Act recognizes the principle of consistency. In the present case, for as many as seven years, previously the Assessing Officer did not dispute certain claims and therefore, the Tribunal correctly interpreted that the Assessing Officer has sought to reopen the issue. 11. It is well accepted that if assessing officer s reason to believe lacks validity, the reopening of assessment would not be permissible. It is true that the words used are reason to believe and that therefore, the same must be based on subjective satisfaction of the assessing officer. The Court s scrutiny in exercise of writ jurisdiction would, therefore, be necessarily limited. Nevertheless, if the proposed addition on the basis of which the entire n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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