9911796707
TMI Blog2015 (6) TMI 283X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal assessment order and thus, wrongly held that the re-opening of assessment amounts to change of opinion. b. On a combined reading of the seized material (NSK/B&D/S-136) with the explanation of the assessee filed before the Assessing Officer on 23.12.2009, it is evident that the said seized material points to a consideration of Rs. 1,81,27,940/- while the explanation dated 23.12.2009 is offered only for Rs. 1,56,65,000/- leaving the balance of Rs. 24,62,840/- c. By virtue of the above position, the assessee's balance of amount of Rs. 24,62,840/- has gone unexplained and thus unassessed in the original assessment. Hence, the order of the CIT(A) is contrary to the facts and legal position. 3. On the facts and the circumstances of the case, the ld. CIT(A) has failed to appreciate that the contents of the seized material were not fully explained by the assessee in their reply at the time of original assessment and therefore the then Assessing Officer has not fully examined the seized material in the original assessment order. 4. The CIT(A) erred in holding that the period available for re-opening the assessment was only 4 years while the sec. 147 r.w.s. 149(1)(b) provides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same seized material, that had been considered by the Assessing Officer while framing the original assessment, is against the settled position of law and thus cannot be approved. Without going into the argument of the appellant that the assessments framed under section 153A could not have been reopening under section 148 in view of the non obstante clause within which sub-section (1) of section 153A opens, it is held that even otherwise the reopening by the Assessing Officer is not valid as the reopening has been done after four years from the end of the assessment year under consideration and there being no failure on the part of the appellant to disclose fully and truly all material facts necessary for the assessment for that assessment year. The reopening and the addition made to the income of the appellant in the reassessment made by the Assessing Officer is based on the same seized material that was considered by him in the original assessment made under section 153A read with section 143(3) which amounts to change of opinion. In view of the facts of the case, as discussed above, the reopening of the assessment based on the same material that had already been considered by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessment for the block period made under Chapter XIVB and relied on the judgment of CIT vs. Peerchand Ratanlal Baid (HUF) 322 ITR 544 (Gauhati) wherein it was held that the addition of Rs. 13,66,715/- to the undisclosed income of the assessee for the block period could have been made only by giving a notice under section 148 of the Act and no such notice having been given the provisions of Section 153 of the Act would operate as a legal bar for any such notice to the assessee. The provisions of Section 147/148 of the Act would apply to an assessment for a block period made under Chapter XIV-B of the Act. 9. We have heard both sides and perused the material on record. In this case original assessment was completed vide assessment order dated 31.12.2009 u/s. 153A r.w.s. 143(3) of the Act, determining the income at Rs. 58,79,492/-. The Assessing Officer noticed that as per seized document No.136 in annexure NSK/B&D/S, dated 20.02.2008, the value of property situated at survey No.176/02, Nolambur is worked out at Rs. 1,18,73,840/- and other property as per seized document No.136 annexure NSK/B&D/S, dated 20.02.2008, situated at New survey No.72, at Nolambur vide sale deed No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nese Ore Co. Ltd. v. ITO [1991] 191 ITR 662 (SC), for initiation of action under Section 147(a) (as the provision stood at the relevant time) fulfillment of the two requisite conditions in that regard is essential. At that stage, the final outcome of the proceeding is not relevant. In other words, at the initiation stage, what is required is 'reason to believe', but not the established fact of escapement of income. At the stage of issue of notice, the only question is whether there was relevant material on which a reasonable person could have formed a requisite belief. Whether the materials would conclusively prove the escapement is not the concern at that stage. This is so because the formation of belief by the Assessing Officer is within the realm of subjective satisfaction. 12. The scope and effect of Section 147 as substituted with effect from April 1, 1989, as also Sections 148 to 152 are substantially different from the provisions as they stood prior to such substitution. Under the old provisions of Section 147, separate Clauses (a) and (b) laid down the circumstances under which income escaping assessment for the past assessment years could be assessed or reassessed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Tribunal in the case of State Bank of India (Mumbai) cited supra in that case held that: That the original assessments for the assessment years in question were completed u/s.143(3) on February 13, 2004 and December 30, 2004, respectively. Thereafter, a search and seizure action was initiated in the assessee's case by the Department on July 2, 2005 on which date the assessments for the two assessment years were not pending. Therefore, in view of the non obstante clause with which Section 153A(1) opens, the Assessing Officer had no jurisdiction to issue notice u/s. 148 of the Act in respect of those six assessment years which fell within the exclusive jurisdiction of section 153A of the Act and accordingly the Assessing Officer was not justified in issuing notices u/s. 148 and in completing the assessments u/s.143(3) read with section 147 of the Act on October 31, 2006. The Assessing Officer instead of complying with the requirement of section 153A proceeded with the provisions of sections 147 and 148 which were not applicable in the assessment under section 153A of the Act. Therefore, the assessments completed u/s.143(3) read with section 147 of the Act were wholly witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terials found indicating incrementing materials, the Assessing Officer engrosses a jurisdiction where he has clubbed two sets of income, return income and unearthed income, had arrived at the total income. Thereafter, if he had a reason to believe the said assessment can be re-assessed u/s.148 of the Income Tax Act as discussed in the earlier paras so as to reopen the assessment, there should be sufficient materials. 20. There is no arbitrary power to the Assessing Officer to reopen on the basis of change of opinion. In the present case we have gone through the reasons for reopening of assessment. It cannot be proper reason to reopening. The Assessing Officer has no power to review his own order. The re-assessment has to be made on fulfillment of certain free condition and if the concept stating ''change of opinion" is removed in the graph of re-assessment or/of assessment, redo take place. Once again treat the concept of change of opinion inbuilt test to check to abusive power by Assessing Officer. Hence, the Assessing Officer has power to reopen, provided there is 'tangible material" to come to the conclusion that there is escapement of income from assessment. The reason mus ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
