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2007 (1) TMI 100 - HC - Income TaxRegular assessment notice issued by AO u/s 143 on basis of information which has come into the possession before assessment there is no merit in contention of assessee that the survey had been conducted after the close of previous year & the assessment for that year couldn t be taken up for scrutiny whatever material the dept. found during the survey was confronted to assessee, so no prejudice has been caused to assessee by framing regular assessment so assessee s appeal rejected
Issues:
Challenge to assessment proceedings for the assessment year 2005-06. Analysis: The petitioner, a private limited company engaged in manufacturing and exporting various products, filed an income tax return for the assessment year 2005-06. A survey was conducted at the business premises, and certain books of account were impounded. The petitioner contended that their case was wrongly selected for scrutiny, citing guidelines for case selection during the financial year 2005-06. However, the court found no merit in this argument, stating that there was no bar under the law or the instructions for scrutinizing cases where a survey had been conducted after the close of the previous year. The petitioner's objection to this effect was rejected by the Assessing Officer, and the court noted that the objection was filed nearly a year after the order was passed. The petitioner further argued that any information found after the previous year ended should be used in proceedings under Sections 147/148 of the Income Tax Act, not during regular assessment. The court dismissed this contention as misconceived, emphasizing that the Assessing Officer had the authority to proceed with the assessment after the petitioner filed their return of income. The court clarified that material found during the survey could be used in the regular assessment under Section 143 of the Act, provided the principles of natural justice were not violated. The court observed that the petitioner had not been prejudiced by the regular assessment and noted the petitioner's attempts to impede the investigation, as evidenced by a previous writ petition challenging the assignment of their case to another Assessing Officer. Based on the discussions, the court found no merit in the petition and dismissed it in limine.
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