1990 (6) TMI 89 - AT - Income Tax

Assessment Proceedings, Reassessment Proceedings, Revised Returns, Voluntary Disclosure Of Income And Wealth Ordinance

Summary

Issues:
1. Validity of assessments under section 143(3) read with section 147(a) of the Income-tax Act, 1961.
2. Disclosure of information regarding possession of trucks by the assessee.
3. Compliance with notice under section 148 read with section 147(a) of the Act.
4. Consideration of disclosed information in assessments.
5. Validity of returns filed by the assessee in response to notices.

Detailed Analysis:
1. The appeals were against the order passed by the Appellate Assistant Commissioner (AAC) regarding assessments for the years 1973-74 and 1974-75 under section 143(3) read with section 147(a) of the Income-tax Act, 1961. The contention was that the assessments were declared null and void by the AAC based on the argument that the information about the possession of trucks by the assessee was already known to the Income Tax Officer (ITO) before completing the assessments, making the subsequent actions a 'change of opinion.'

2. For the assessment year 1973-74, the assessee filed a return declaring income, which was accepted under section 143(1) of the Act. A voluntary disclosure was made under the Voluntary Disclosure of Income and Wealth Ordinance, 1975, declaring the trucks. Subsequently, a duplicate return was filed, leading to another assessment under section 143(3) of the Act.

3. In 1978, the assessee filed another return for the same assessment year, claiming it was in response to a notice under section 148 of the Act. However, the Revenue denied issuing any such notice before 1978. A notice under section 148 was served in 1982, leading to a reassessment in 1986, which prompted the present appeal.

4. The AAC held both reassessments as null and void, stating that the subsequent actions were a 'change of opinion' and the ITO was not justified in initiating fresh proceedings under section 148. The AAC raised concerns about the lack of evidence of notices and the possibility of tampering with order sheets.

5. The AAC's decision was challenged, arguing that the assessments should not be declared null and void. The case was restored to the AAC for fresh orders, emphasizing the need for a thorough review of the Revenue's case, the sequence of events, and the validity of notices served. The AAC was reminded of the importance of considering all facts before making a decision, especially regarding the service of notices and the possibility of tampering with records.