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TMI Blog2004 (3) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... d in exports on specific enquiries. The original assessments were completed under s. 143(1)(a) of the Act. The main issue involved in the appeal before the CIT(A) was whether the assessments for the years in question were validly reopened and made under s. 143(3)/147 after taking due note of the preceding sequence of events on record. Both the appeals being identical except for difference in figures in some places the appeal for asst. yr. 1995-96 may be taken first. The due date for filing the return for 1995-96 is 30th Oct., 1995. The date of completion of the assessment under s. 143(1)(a) is 24th May, 1996. Time limit to issue notice under s. 143(2) for making assessment under s. 143(3) was upto 31st Oct., 1996. The normal period availabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lding orders of the AO passed under s. 147 where the very condition precedent for the exercise of jurisdiction under s. 147 is totally absent. The expenditure or deduction wrongly allowed in the assessment under s. 143(1)(a) cannot be brought to tax by reopening the assessment under s. 147 after subsequently forming an opinion that, the AO had earlier erred in allowing the said expenditure or deduction. 2.2 The decisions in the case of Vipan Khanna vs. CIT (2002) 175 CTR (P H) 335 : (2002) 255 ITR 220 (P H) as well as CBDT Circular No. 549, dt. 31st Oct., 1989, to the effect that the proceedings under s. 143(1)(a) came to an end and the matter became final, have not been appreciated especially when the AO failed to issue notice under s. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessing authority of the correctness of what has been submitted by the assessee in his return for which intimation had been given. (d) The term "assessment" can, therefore, be regarded as capable of being applied to an intimation under s. 143(1) especially where the regular assessment had not been made under s. 143(3)..." 2.3 The CIT(A) has further misdirected himself in not following a binding precedent of the jurisdictional High Court decision and is putting forth an extraordinary observation at para 5 of his order that the provision [cl. (b) of Expln. (2) of s. 147] read in conjunction with cl. (c) of Expln. (2) clearly reflects the fact that the legislature never intended to treat the intimation under s. 143(1)(a) as an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiated the reassessment proceedings on the basis of subsequent information which was specific, relevant and reliable and, after recording the reasons for the formation of his own belief that, in the original assessment proceedings, the assessee had not disclosed the material facts truly and fully and, therefore, income chargeable to tax had escaped assessment. He, therefore, correctly invoked the provisions of ss. 147(1) and 148 of the Act. 2.4 The CIT(A) failed to appreciate the admitted position, as borne out by the records that as between the date of completion of assessment under s. 143(1)(a), i.e., 24th May, 1996 and date of service of notice under s. 148, i.e., 23rd Dec., 1999 and even before completion of assessment under s. 143 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 and gave a go-by to the binding Madras High Court decision reported in (2001) 169 CTR (Mad) 228 : (2001) 250 ITR 333/336 (Mad) by relying on a totally inapplicable Supreme Court decision in (1993) 113 CTR (SC) 436 : (1993) 203 ITR 456 (SC). Hence viewed from any angle the order of the CIT(A) on the face of it is perverse, illegal and void besides deviating without any rational basis from procedures and principles laid down in the binding CBDT circulars cited supra and also the decision of the jurisdictional High Court cited aforesaid. Hence the order of the CIT(A) is liable to be set aside in the interest of justice. All the contentions are equally applicable for the other appeal of the asst. yr. 1997-98 also. 3. On the other hand, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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