TMI Blog2021 (12) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment by reason of any failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for that assessment year. The condition precedent for taking action u/s.147 after four years from the end of the relevant assessment year where the original assessment was completed u/s.143(3), is that there must be failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. It is only when there is such a failure on the part of the assessee and further the reasons recorded by the AO for initiating the re-assessment proceedings refer to such fact of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt was completed u/s.143(3) of the Act on 31-12-2008 accepting the returned income. Thereafter, the AO initiated the reassessment proceedings by means of a notice u/s.148 opining that the assessee violated provisions of section 13(1)(c)(ii) and 13(2)(b) of the Act. The assessee furnished explanation to the effect that there was no violation. The AO noticed that the assessment proceedings for the assessment years 2010-11 and 2011-12 transpired that the assessee charged rent from letting out Shop Nos. 2, 3 and 4 of the ground floor to one of the trustees on a nominal rent ranging from ₹ 2.1 to ₹ 2.73 per sq.ft. as against rent charged from Bank of Maharashtra at ₹ 23.44 per sq.ft. and also from a third party at ₹ 4.25 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her tenants by Mukung Bhawan Trust. It is seen that the assessee trust has violated the provisions of section 13(1)(c)(ii) and 13(2)(b) of the I.T. Act, 1961. Under these circumstances, exemption of the trust enjoyed u/s.11 and 12 becomes non applicable as there is gross violation of section 13 of the Act. In view of the above, I have reason to believe that there is an escapement of an income u/s.147 of the I.T. Act, 1961. 5. On going through the above reasons, it becomes evident that the AO in the first sentence is referring to the assessment proceedings for the assessment years 2010-11 and 2011-12 revealing the letting out of three shops on the ground floor of the building to one of the trustees. The second line talks of letting out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by reason of any failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for that assessment year. To put it simply, the condition precedent for taking action u/s.147 after four years from the end of the relevant assessment year where the original assessment was completed u/s.143(3), is that there must be failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. It is only when there is such a failure on the part of the assessee and further the reasons recorded by the AO for initiating the re-assessment proceedings refer to such fact of the failure that a valid initiation of re-assessment can take place. We are confronted with a situation ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
