TMI Blog2007 (7) TMI 256X X X X Extracts X X X X X X X X Extracts X X X X ..... P. P. S. Janarthana Raja, J. - This appeal is filed under Section 260A of the Income Tax Act, 1961 by the Revenue, against the order of the Income Tax Appellate Tribunal, Chennai Bench 'C', Chennai in I.T.A. No.1726/Mds/2004 dated 19.01.2007, raising the following substantial question of law:- "Whether on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in upholding the order of the Commissioner of Income-tax (Appeals) and accordingly the reopening of the assessment under section 147 read with section 148 is held as bad in law, even though the facts and circumstances of the case fall within the exemption provided in Explanation 1 to section 147 of the Income-tax Act, 1961?" 2. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome-tax (Appeals) accepted the contention of the assessee and allowed the appeal and held that reopening of the assessment under Section 148 is bad in law. Aggrieved, the Revenue filed an appeal to the Income-tax Appellate Tribunal ("the Tribunal" in short). The Tribunal dismissed the Revenue's appeal and confirmed the order of the Commissioner of Income-tax (Appeals). Hence the present appeal by the Revenue. 4. Learned Standing Counsel appearing for the Revenue submitted that the interest accrued and receivable by the assessee company from another Government Company, Viz., M/s. Tamil Nadu State Civil Construction Corporation Limited, amounting to Rs.148.69 lakhs was omitted to be brought to tax. It is further submitted that the mere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7, Transport Department, dt.3.4.96 stated that out of the interest due of Rs.397 lakhs on the principal upto 31.3.95, Rs.100 lakhs should be waived and should treat the balance amount of Rs.297 lakhs as a fresh loan with effect from 1.4.95 at 12% simple interest repayable in five annual instalments. Even though Govt. have directed to treat the interest of Rs.297 lakhs due as loan since the borrower is a defaulter ab initio as a prudent measure and as per the prudential norms on income recognition issued by RBI the interest income received will be taken into account on realisation basis. The amount not taken into account is Rs.72.18 lakhs being the difference in interest provided by the Company and Rs.297 lakhs allowed by the Government and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion shall be taken under this section after the expiry of four years from the end of relevant assessment year unless income chargeable to tax has escaped assessment for the relevant assessment year by reason of failure on the part of the assessee to disclose fully and truly all the material facts necessary during the course of original assessment proceedings. The conditions as enumerated in the proviso in the present case are not met with by the Revenue, while issuing notice under section 148 for reopening of assessment under section 147 of the Act. It is a fact that during the course of original assessment proceedings the information regarding interest accrued and receivable by the assessee from another Government Company i.e M/s. Tamil N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istinction has now been taken away by the Amendment Act. Previously, the line of distinction was a limitation period of four years and the limitation period exceeding four years. The Assessing Officer would reopen a back assessment within a period of four years as long as he had reason to believe in consequence of any information, that income has been under-assessed or income has escaped assessment. In the case of limitation, providing for a period exceeding four years, there should have been a failure on the part of the assessee to disclose fully and truly all material facts leading to the escapement of income. But as a result of the amendment brought with effect from April 1, 1989, the above distinction had been obliterated and the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year. Hence it is clearly barred by limitation under proviso to Section 147 of the Act. Following the above principle, the Tribunal is correct in its conclusion that reopening is bad in law. The concurrent finding given by both the authorities below is based on valid materials and evidence. In the case of Commissioner of Income-tax Vs. P. Mohanakala [2007] 291 ITR 278 (SC), the Supreme Court held that whenever there is a concurrent finding by the authorities below, no interference should be called for by the High Court. Under these circumstances, we do not find any error or legal infirmity in the order of the Tribunal so as to warrant interference. 9. In view of the foregoing reasons, no substantial question of law arises ..... X X X X Extracts X X X X X X X X Extracts X X X X
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