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Panchratna Co-op. Housing Society Ltd. Versus The Assessing Officer 16 (3) (1) , The Addl/Joint Commissioner of Income Tax, Union of India

2015 (7) TMI 920 - BOMBAY HIGH COURT

Validity of reopening of assessment - Held that:- Firstly, there is no failure to make full and true disclosure of necessary facts which is the jurisdictional requirement for initiating reopening proceedings after period of four years as per the proviso to Section 147. Secondly, the reasons do not show that there was any failure to disclose. Mr. Malhotra, on behalf of the respondent-revenue contended that the Petitioner filed a return before a wrong authority and, therefore, that earlier return .....

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cided in favour of assessee. - Writ Petition No. 2216 of 2007 - Dated:- 16-7-2015 - M S Sanklecha And N M Jamdar, JJ. For the Appellant : Mr. Swapnil Bangur For the Respondent : Mr A B Malhotra along with N A Kazi JUDGMENT (Per N. M. Jamdar,J. ) The Petitioner challenges the notice dated 15 March 2007 issued by the Respondent-Income Tax authorities, under Section 148 of the Income Tax Act, 1961 (the Act), seeking to reopen the assessment for the year 2001-02. 2. The Petitioner is a Cooperative H .....

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al return filed on 31 October 2001 be treated as return under Section 148 without prejudice to the challenge the legality of the reassessment. By letter dated 3 May 2007, the Respondent No.1 supplied grounds for reopening the assessment. By letter dated 31 May 2007, the Petitioner submitted its objections to the notice for reassessment, which were rejected by the Respondent No.1 by order dated 24 August 2007. Thereafter, the Petitioner has approached this Court by way of the present petition. 3. .....

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s the assessee had failed to disclose fully and truly all material facts necessary for his assessment for that assessment year. 5. Sections 147 and 148 of the Act have been interpreted by numerous decisions of this Court. It is settled law that the conditions specified in Section 147 are jurisdictional requirements and unless they are fulfilled no proceeding under these sections can be taken. It is open for the assessee to challenge the initiation of the reassessment proceedings, if the assessee .....

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the Assessing Officer to the assessee. If the reassessment proceedings are to be initiated after a period of four years on the ground that the assessee failed to make full and true disclosure of all necessary facts, then, the Assessing Officer must state so in the reasons and the action must be founded on such reason. 7. In the present case, reasons were furnished to the Petitioner by the Assessing Officer. The reasons for reopening as forwarded to the petitioner as under : "The assessee h .....

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ture are shown at ₹ 2,10,56,138/leaving a gross surplus of ₹ 36,29,230/- which has been purportedly set off against deficit of earlier years claimed at ₹ 1,67,09,860/-. From Schedule 3 to the Balance sheet, it is seen that the assessee has received deposits/advances to the extent of ₹ 45,88,763/- from certain parties who are not members of the C.H.S. It is also seen that such deposits/advances had also been received during the preceding year to the extent of ₹ 57,49 .....

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r sources" in the hands of the assessee Society. However, the assessee has not disclosed any income as taxable in its hands. In the immediately preceding year i.e. A.Y. 2000-01, the assessee had filed its return of income on 18.08.2000, declaring the total income at Rs.NIL, but the assessment was finalized under Section 143(8) r/w S.147 on 28.11.2003, determining the assessed income at ₹ 1,21,22,995/-. The additions made in this assessment order were as follows: 1. On account of Trans .....

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s for carrying repair material for repair work in their individual premises. ₹ 49,275/- 6. Advertisement charges collected from Members for displaying notices on the ground floor Notice Board in the Society premises. ₹ 23,358/- 7. Nonoccupancy charges collected from Members who have let out the premises standing in their names, to outside parties (which is over and above the annual society charges paid by the Members). ₹ 81,61,620/- 8. Car parking charges collected from Members .....

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27.08.04 in which all the items deleted by the Ld. CIT (A) have been contested before the Hon'ble ITAT and this appeal is still pending. The assessee has followed the same pattern of filing returns for all subsequent years although successive A.O.'s have relied upon a Plethora of decisions in which it has been held again and again that any receipt in the hands of a CHS which is collected from an outside party in lieu of services, or license to use a part of the premises for furthering i .....

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ssessment within the meaning of Sec.147, for A.Y. 2001-2002, in the hands of the assessee - M/s.The Panchratna Coop. Hsg. Society Ltd. A proposal was submitted in this regard, to the Addl./dt. CIT. Range 16(3), Mumbai, requesting for necessary approved as provided u/s 149 to reopen the proceedings for A.Y. 2001-02 in the case of M/s.The Panchratna Coop. Hsg. Soc. and for the issue of a Notice u/s 148 accordingly. The Addl. Jt. CIT Range 16(3)/147/ 2006-07, dt. 15.03.2007 has agreed with the prop .....

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n view of service or license to use part of the premises for its own business interest, is liable to be taxed as income and not to be covered by the principle of mutuality. The Assessing Officer accordingly recorded that he had reason to believe that income chargeable to tax in excess of ₹ 1 lac escaped assessment for the accounting year 2001-02. To arrive at this finding, the Assessing Officer considered the statement of computation, income and expenditure account, balancesheet, auditors& .....

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