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TMI Blog2010 (3) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... 8(va). Held that- the jurisdiction to reopen the assessment was not validly exercised since the condition president laid down by the statute for reopening of an assessment beyond a period of 4 years of the expiry of the relevant assessment year had not been fulfilled. Allow the appeal. X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Bank of India submitted by the petitioner reflects that an amount of Rs. 17,01,562 was shown to be received from Little and Company during the assessment year 2003-04. The reasons also contain a statement to the effect that the capital account of the petitioner furnished with the return of income shows a receivable of Rs. 1,36,12,500 from Little and Company, on retirement. The case which is sought to be made out for reopening the assessment is that under clause 35 of the deed of partnership, a partner who has retired voluntarily shall not, as long as the continuing or surviving partners shall carry on the business, solicit the clients of the firm for a period of three years from the date of his retirement. According to the Assessing Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olicit the clients of the firm for a period of three years and the inference which is sought to be drawn by the Assessing Officer to the effect that the amount was paid to the petitioner on his retirement in consideration of a renunciation of his right to freely practice his profession is ex facie perverse. Counsel submitted that as a matter of fact the petitioner continued to practice as a lawyer upon retirement from Little and Company, as a partner in another firm, to which the attention of the Assessing Officer was drawn. Clause 35 of the deed of partnership did not contain any covenant for renouncing the right to practice the profession of a lawyer. 5. An affidavit-in-reply has been filed in these proceedings by the Assessing Officer. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to reopen the assessment has not been fulfilled, the reopening of the assessment would have to be quashed with a consequential setting aside of all the subsequent proceedings. We may also note that by an interim order dated January 25, 2010, passed by this court, the petitioner was permitted to file an appeal before the Commissioner of Income-tax (Appeals) without prejudice to his rights and contentions in the petition. Hence, the filing of an appeal cannot oust the remedy of a petition under article 226. An appeal had to be filed to obviate the bar of limitation. 7. The proviso to section 147 of the Income-tax Act, 1961 stipulates, inter alia that, where an assessment under sub-section (3) of section 143 has been made, for the relevant as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. Therefore, the basic question that needs to be addressed on facts is, as to whether there was any failure on the part of the petitioner, as the assessee, to disclose fully and truly all material facts necessary for the assessment. 8. The record before the court shows that in the return of income which was filed on December 18, 2003, the petitioner had by a note appended to the computation of income specifically disclosed that "during the year the assessee has retired with effect from September 30, 2002 as a partner from Little and Company, advocates and solicitors and with effect from October 1, 2002 has joined as a partner in ANS Law Associates, Advocates and Solicitors". The capital account which was annexed to the return reflects rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment. 10. From the aforesaid narration of facts, it is evident that the petitioner made a full disclosure of all the material facts necessary for the assessment for the assessment year 2003-04. The petitioner duly explained (i) his retirement from Little and Company ; (ii) the fact that an amount of Rs.1,36,12,500 was receivable from Little and Company on retirement ; (iii) that during the course of the assessment year one instalment had been received and the balance as on March 31, represented the balance after accounting for the instalment received. There was no failure on the part of the petitioner to disclose fully and truly all the material facts necessary for the assessment for that assessment year. In these circumstances, the j ..... X X X X Extracts X X X X X X X X Extracts X X X X
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