TMI Blog2021 (12) TMI 495X X X X Extracts X X X X X X X X Extracts X X X X ..... erwise not permissible in law as the same is based on a change of opinion. It cannot be said that there was any failure on the part of the assessee to fully and truly disclose all the material facts. The present case, in our opinion, could be said to be squarely covered by the decision of the Supreme Court rendered in the case of CIT vs. Kelvinator India [ 2010 (1) TMI 11 - SUPREME COURT] No case for Revenue that assessee had failed to disclose all material facts fully and truly, the impugned notice under Section 148 of the Act issued to the assessee for the purpose of reopening of the assessment beyond the period of four years is not sustainable in law. Therefore, the case of the assessee is covered by proviso to section 147 of the Income Tax Act, and the reopening being bad in law, we hereby quash the assessment order passed u/s 143(3) r.w.s 147 of the Act. The ground nos.1 2 raised by assessee are allowed. - ITA No. 7963/MUM/2019 - - - Dated:- 12-11-2021 - SHRI S. RIFAUR RAHMAN (ACCOUNTANT MEMBER) AND SHRI PAVAN KUMAR GADALE (JUDICIAL MEMBER) Assessee by : Ms. Ritu Kamal Kishore, AR Revenue by : Mr. S.N. Kabra, DR ORDER PER S. RIFAUR RAHMAN, A.M. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AO and the Ld. CIT (A) erred in confirming the AO s action of reopening the assessment u/s. 147 by issue of notice dated 31.03.2017 u/s. 148, which is barred by limitation, bad-in-law, illegal and otherwise void for want of jurisdiction. 2. On the facts and circumstances of the case and in law, both the Ld. AO and the Ld. CIT (A) erred in confirming the AO s action of reopening the assessment u/s. 147 by issue of notice dated 31.03.2017 u/s. 148, which is barred by limitation in view of the first proviso to section 147 of the Income Tax Act, 1961. 3.On the facts and in the circumstances of the assessee s case and in law the Ld. CIT(A) erred in confirming the addition to the extent of 12.5% of alleged total bogus purchases of ₹ 1,06,82,780/-. 4. On the facts and in the circumstances of the assessee s case and in law the Ld. CIT(A) erred in confirming the AO s action of making an addition of ₹ 1,06,82,780/- to the books profit u/s. 115JB in respect of alleged bogus purchases. 5. In grounds 1 2, the assessee has challenged the validity of issue of notice u/s 148 of the Act. The Ld. AR has contended that the regular assessment had been comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he notice having been issued 31.03.2017, whereas the fouryear period has expired on 31.03.15. In the notice issued by the AO, we find that there is no mention of any failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for the year under consideration. The evidence on record clearly establishes that the details of purchases were filed during the course of regular assessment proceedings. When the primary facts have been disclosed at the time of the regular assessment and when there is no allegation in the reasons recorded that there has been failure on the part of the assessee to disclose fully and truly all the relevant facts necessary for assessment, the reopening is bad in law, being barred by limitation in view of 1st proviso to section 147 of the Act. For the sake of convenience, we reproduce the 1st proviso to section 147 of the Act as under: Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of 4 years from the end of relevant assessment year, unless any income chargeable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is sought to be raised for the purpose of reopening which is otherwise not permissible in law as the same is based on a change of opinion. It cannot be said that there was any failure on the part of the assessee to fully and truly disclose all the material facts. The present case, in our opinion, could be said to be squarely covered by the decision of the Supreme Court rendered in the case of CIT vs. Kelvinator India, reported in (2010) 2 SCC 723, wherein the Supreme Court observed as under; 5. On going through the changes, quoted above, made to Section 147 of the Act, we find that, prior to the Direct Tax Laws (Amendment) Act, 1987, reopening could be done under the above two conditions and fulfillment of the said conditions alone conferred jurisdiction on the assessing officer to make a back assessment, but in Section 147 of the Act (with effect from 1-4- 1989), they are given a go-by and only one condition has remained viz. that where the assessing officer has reason to believe that income has escaped assessment, confers jurisdiction to reopen the assessment. Therefore, post-14- 1989, power to reopen is much wider. However, one needs to give a schematic interpretation to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... place of the words for reasons to be recorded by him in writing, is of the opinion . Other provisions of the new Section 147, however, remain the same. (emphasis supplied) 9. For the aforestated reasons, we see no merit in these civil appeals filed by the Department, hence, dismissed with no order as to costs. 8. On the facts of the instant case we find that when there is no case for Revenue that assessee had failed to disclose all material facts fully and truly, the impugned notice under Section 148 of the Act issued to the assessee for the purpose of reopening of the assessment beyond the period of four years is not sustainable in law. Therefore, the case of the assessee is covered by proviso to section 147 of the Income Tax Act, and the reopening being bad in law, we hereby quash the assessment order passed u/s 143(3) r.w.s 147 of the Act. The ground nos.1 2 raised by assessee are allowed. 8.1 As we have quashed the assessment framed by the Ld. AO under Sec. 143(3) r.w.s 147, we refrain from adjudicating on grounds 3 and 4 as the assessment no longer survives, the same having been quashed. 9. In the result, the appeal filed by the assessee is partly allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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