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TMI Blog1982 (2) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... er, for the purposes of computing the written down value for the assessment years 1962-63 and 1963-64, the contributions made by the consumers prior to January, 1961, should be deducted ? " The relevant assessment years are 1962-63 and 1963-64, respectively. The assessee is a limited liability company which carries on the business of generation and distribution of electricity at two places, namely, Jaunpur and Fyzabad. It maintained accounts on the basis of calendar years, so that the corresponding " previous years " for the two years in the reference are the calendar years 1961 and 1962. The assessee laid electric cables for supplying electrical energy to the consumers. The consumers were required to contribute a portion of the cost of ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the assessment for the assessment year 1962-63, it was contended by the assessee that the assessment could not be reopened under s. 147(b) as the conditions for bringing into play that provisions were not complied with. In respect of this point, all that the ITO has stated is as follows : " On the day of appointment, two points were urged before me, firstly, the assessment cannot be reopened under section 147. Secondly, there is no jurisdiction for taking into consideration all the contributions from the consumers right from the beginning. Both points of the assessee cannot be sustained. It will be sufficient to point out that the assessment is reopened very much within the 4 years' time limit permitted by section 147(b) under which the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received from the consumers prior to April 1, 1961, were furnished along with the return Regarding the immediately preceding observation made by the Tribunal, an application was made by the assessee to the Tribunal for rectification. That application was rejected, but from the order made on the said rectification application, which order dated June 14, 1971, it can be seen that the assessee had, along with the return, annexed the balance-sheet showing the consumers' contributions for service connections in respect of the assessment year 1962-63. The Tribunal rejected the entire appeal of the assessee. It is from this order of the Tribunal that the aforesaid questions have been referred to us. Coming first to the controversy regarding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scaped assessment for any assessment year and such belief must be in consequence of information in his possession. Although there is considerable controversy as to what is the nature of the information required to be possessed by the ITO before taking action under cl. (b) of s. 147, there is no dispute that he must have information which gives him reason to believe that the income chargeable to tax had escaped assessment. There is also no dispute that such information must be acquired by the ITO after the assessment order, sought to be reopened, had been passed. Mr. Joshi, the learned counsel for the Commissioner, has urged that the requisite information may even be obtained by the ITO from the record of the original assessment or from an i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contributions have not been set out on the correct side of the balance-sheet, as they were set out by the assessee on the liabilities side, whereas according to Mr. Dastur there was nothing improper or incorrect in this procedure and the said contributions did, in fact, represent liabilities of the assessee. In our view, it is not necessary to go into this controversy or to discuss the cases cited before us in that connection. It is apparent that it is for the ITO reopening an assessment under cl. (b) of s. 147 of the said Act to state that he had reason to believe that the income had escaped assessment in the earlier assessment and that that belief had been induced by the same information received by him after the original order of assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not applied his mind to the question whether the consumers' contributions had to be deducted from the written down value of the service connections. But one fails to see as to what was the basis on which they could have said so. The order of assessment and that of reassessment were passed by different ITOs. It may be mentioned that even the notice for showing cause against the reopening of the assessment under cl. (b) of s. 147 was not issued by the officer, who passed the original order of assessment, bat was issued by the officer, who ultimately passed the order reopening the assessment. The ITO, who passed the original order of assessment, does not seem to have appeared even before the Tribunal or made a statement as to what was the mis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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