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TMI Blog2010 (10) TMI 805X X X X Extracts X X X X X X X X Extracts X X X X ..... s chargeable to income-tax have escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of either omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. Both these conditions were conditions precedent to be satisfied before the AO could have jurisdiction to issue notice under s. 148 r/w s. 147(a). But under the substituted s. 147 existence of only the first condition suffices. In other words if the AO for whatever reason has reason to believe that income has escaped assessment it confers jurisdiction to reopen the assessment. It is, however, to be noted that both the conditions must be fulfilled if the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition on account of capital gains. Appeal of the assessee against the order of assessment was dismissed but on further appeal, the Tribunal held that notice under s. 148 of the Act itself was not maintainable as the AO had not resorted to s. 143(2) of the Act and if that remedy was not taken, recourse to s. 147 of the Act was not permissible. Reliance was placed on judgment of the Hon'ble Supreme Court in Trustees of H.E.H. The Nizam's Supplemental Family Trust vs. CIT (2000) 159 CTR (SC) 114 : (2000) 242 ITR 381 (SC), holding that where assessment had not been finalised and notice under s. 143(2) of the Act was pending, reassessment could not be resorted. The observations of the Tribunal, after noticing the judgment in Nizam's Supplemental ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and independent power and there is no requirement that before exercise of such power, recourse to s. 143(2) of the Act must be taken. It is a different matter if s. 143(2) of the Act has been resorted to and assessment is pending. Parallel proceedings for reassessment cannot be initiated, as held in Nizam's Supplemental Family Trust (supra). Where no proceedings are initiated under s. 143(2) of the Act and conditions of s. 147 of the Act are fulfilled, there is no legal bar to proceed under the said provision of s. 147 of the Act. Reliance has been placed on judgment of the Hon'ble Supreme Court in Asstt. CIT vs. Rajesh Jhaveri Stock Brokers (P) Ltd. (2007) 210 CTR (SC) 30 : (2007) 291 JTR 500 (SC), wherein it was held:- "17. The scope a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 147 and failure to take steps under s. 143(3) will not render the AO powerless to initiate reassessment proceedings even when intimation under s. 143(1) had been issued." 5. Learned counsel for the assessee on the other hand relied upon judgment of Madras High Court in CIT us. TCP Ltd. (2010) 44 DTR (Mad) 31, wherein the view taken by the Madras High Court was identical to the view taken by the Tribunal. Reliance has also been placed on judgments of Delhi High Court in CIT vs. Ved and Co. (2007) 209 CTR (Del) 455 : (2008) 302 ITR 328 (Del) and KLM Royal Dutch Airlines vs. Asstt. Director of IT (2007) 208 CTR (Del) 33 : (2007) 292 ITR 49 (Del) and judgment of the Hon'ble Supreme Court in CIT vs. Kelvinator of India Ltd. (2010) 228 CTR (SC) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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