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Issues:
1. Validity of reassessment proceedings under section 147(b) without any subsequent information. 2. Interpretation of the conditions for invoking section 147(b) based on the decision of the Hon'ble Supreme Court in the case of Kalyanji Mavji & Co. Detailed Analysis: 1. The appeal before the Appellate Tribunal ITAT Jaipur was regarding the validity of reassessment proceedings under section 147(b) for the assessment year 1975-76. The issue arose when the Income Tax Officer (ITO) disallowed an excess claim of remuneration paid to the Managing Director after reopening the assessment under section 147(a) due to the provisions of section 40(c) limiting the deduction to Rs. 72,000. The CIT (Appeals) upheld the reassessment, leading to the appeal by the assessee before the Tribunal challenging the validity of the reassessment without any subsequent information indicating income escaping assessment. 2. The Tribunal considered the arguments presented, particularly focusing on the interpretation of the conditions for invoking section 147(b) based on the decision of the Hon'ble Supreme Court in the case of Kalyanji Mavji & Co. The Tribunal disagreed with the departmental representative's contention that the reassessment was valid solely based on the ITO's mistake in allowing the excess claim in the original assessment. The Tribunal emphasized that for section 147(b) to be invoked, the existence of information is a prerequisite, as established by the Supreme Court. The Tribunal highlighted that the Supreme Court's decision required the presence of subsequent information justifying the reassessment, which was lacking in the current case. 3. The Tribunal further elaborated on the necessity of information for invoking section 147(b), emphasizing that the ITO's error in allowing the excess claim did not suffice as a basis for reassessment without any additional information. The Tribunal scrutinized the timeline of events and the lack of evidence indicating any new information received by the ITO between the original assessment and the reassessment. The Tribunal emphasized that without any external source of information or research into the material on record, the reassessment under section 147(b) was not justified. Ultimately, the Tribunal quashed the reassessment, ruling in favor of the assessee based on the absence of requisite information for invoking section 147(b). 4. Consequently, the appeal was allowed in favor of the assessee, highlighting the importance of establishing the presence of information as a crucial factor in initiating reassessment proceedings under section 147(b) in cases where income has escaped assessment due to oversight or mistake by the assessing officer.
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