9911796707
TMI Blog2006 (10) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... exempt from tax under section 80P(2)(a) (i) of the Act. The petitioner was being allowed exemption from tax for about 40 years. For the assessment year 1999-2000, the petitioner filed return under section 139(1) of the Act, claiming that its entire income was exempt under section 80P(2)(a)(i) of the Act. The return was accepted under section 143(1) of the Act and refund was also issued. Thereafter, on 31.3.2005, impugned notice for re-opening assessment was issued. Reasons therefor were also supplied vide letter dated 7.11.2005, Annexure P.5. In the said letter, it was mentioned from the RBI. It was also not a member of clearing house and did not provide cheque book facilities to the public. In the judgment of the Hon'ble Supreme Court in U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2002-03. It was for this reason that during the said year, the assessing officer applied his mind and found that certain deductions were wrongly allowed and on that basis, the assessing officer decided to reopen the case for the year 1999-2000. Objections of the petitioner on merits could be gone into during the assessment. 5. We have heard learned counsel for the parties and perused the record. 6. The expression "reason to believe" has been subject matter of judicial interpretation. Upto March 31, 1989 with effect from which date Section 147 of the Act has been amended, satisfaction that the income had escaped was required either on account of omission or failure of the assessee to make the return or disclose material facts or on ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the view of Gujarat High Court in Praful Chunilal Patel v. Makwana (M.J.), CIT (Asst.) (1999) 236 ITR 832, to the effect that where no assessment was earlier made, the assessing officer could not be attributed application of any mind, was dissented from on the ground that under the scheme of the Act, the assessing officer could not review his own order and power of rectification could be exercised only within the scope of Section 154 of the Act. The assessing officer could not indirectly exercise power of review. It was further observed that if "reason to believe" for the Assessing Officer is founded on any information which may have been received after completion of assessment, it may be sound foundation of exercising power under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy. Section 263 of the Act empowers the Commissioner to review an order which is prejudicial to the Revenue." 8. The matter has also been considered by this Court in Swaraj Engine Limited v. Assistant Commissioner of Income Tax and another, (2003) 260 ITR 202, wherein, it was observed (Headnote) : "An Income tax Officer acquires jurisdiction to reopen an assessment under section 147(a) read with section 148 of the Income Tax Act, 1961 only if on the basis of specific, reliable and relevant information coming to his possession subsequently, he has reasons, which he must record, to believe that, by a reason of omission or failure on the part of the assessee to make a true and full disclosure of all material facts necessary for each assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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