TMI Blog2007 (8) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... ANDIAN and MRS. CHITRA VENKATARAMAN JJ. T. Ravikumar for the appellant. None appeared for the respondent. JUDGMENT The judgment of the court was delivered by K. Raviraja Pandian J.- These appeals are filed by the Revenue aggrieved by the order of the Income-tax Appellate Tribunal dated December 7, 2000, framing the following questions of law : " 1. Whether, on the facts and circumstances of the case, the Tribunal was right in law in not considering Explanation 2 to section 147 which provides that the Assessing Officer can reopen the assessments even if the assessments have not been completed under section 143 and only intimation had been sent, if the conditions laid under section 147 are fulfilled? 2. Whether, on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income-tax Appellate Tribunal by way of second appeals by contending that the returns were processed under section 143(1)(a) initially which would not amount to disposing of the same simply because intimation under section 143(1)(a) was deemed to be a notice of demand under section 156 of the Income-tax Act. It was further contended that the notices subsequently issued under section 148 of the Act were not valid and the assessments were liable to be set aside. The Tribunal accepted the contentions of the assessee and allowed the appeals by setting aside the order of the Commissioner of Income-tax (Appeals) holding that during the pendency of the valid return, reassessment proceedings could not be initiated. The correctness of the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Production before the Assessing Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer will not necessarily amount to disclosure within the meaning of the fore-going proviso. Explanation 2. - For the purposes of this section, the following shall also be deemed to be cases where income chargeable to tax has escaped assessment, namely:- (a) where no return of income has been furnished by the assessee although his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax ; (b) where a return of income has been fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me has escaped assessment while issuing intimation under section 143(1) he could proceed further under section 147/148. The absence of an order under section 143(3) is not a bar. The proviso to section 147 which provides that no action shall be taken under the section after the expiry of four years from the end of the relevant assessment year in a case where an assessment under section 143(3) has been made for the relevant assessment year indicates that section 147 can be invoked not only after an order has been passed under section 143(3) of the Act, but even otherwise before such an order is passed. Furthermore, clause (b) of Explanation 2 also makes the position amply clear that where a return of income has been furnished by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eming provision, the Kerala High Court held that so long as the ingredients of section 147 are fulfilled, the Assessing Officer was free to initiate proceedings under section 147 and failure to take steps under section 143(3) would not render the Assessing Officer powerless to initiate reassessment proceedings even when intimation under section 143(1) had been issued. 7. The Punjab and Haryana High Court in the case of Punjab Tractors Ltd. v. Joint CIT [2002] 254 ITR 242 held that if the Assessing Officer had reason to believe that any income chargeable to tax had escaped assessment for any assessment year, he could proceed to assess or reassess such income. Thus, the condition precedent for proceeding under section 147/ 148 was th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) : "The scope and effect of section 147 of the Act, as substituted with effect from April 1, 1989, as also sections 148 to 152 are substantially different from the provisions as they stood prior to such substitution. Under the old provisions of section 147, separate clauses (a) and (b) laid down the circumstances under which income escaping assessment for the past assessment years could be assessed or reassessed. To confer jurisdiction under section 147(a) two conditions were required to be satisfied : firstly, the Assessing Officer must have reason to believe that income profits or gains chargeable to income-tax have escaped assessment, and, secondly, he must also have reason to believe that such escapement has occurred by reason of e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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