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TMI Blog2012 (7) TMI 556X X X X Extracts X X X X X X X X Extracts X X X X ..... in case there is non-disclosure of facts and the income escaping assessment is more than Rs.1,00,000/- the limitation is six years - in favour of assessee. - ITA No. 22 of 2007 - - - Dated:- 18-6-2012 - Mr. Justice Deepak Gupta, Mr. Justice Rajiv Sharma, JJ. For the appellant: Mr. Vinay Kuthiala Sr. Advocate with Ms. Vandana Kuthiala, Advocate. For the Respondents: Mr. K.D. Sood, Sr. Advocate with M/s Abhishek Jhamba and Sanjeev Sood, Advocates. Per Deepak Gupta, J (oral) 1. Though this appeal by the Revenue was admitted on a different question of law but in our opinion the following question of law arises in this case:- Whether in a case falling under proviso to Section 147 of the Income Tax Act, 1961, if there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this Section, or recomputed the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year): Provided that where an assessment under subsection (3) of or this section has been made for the relevant assessment year, no ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been under assessed; or (ii) such income has been assessed at too low a rate; or (iii) such income has been made the subject of excessive relief under this Act; or (iv) excessive loss or depreciation allowance or any other allowance under this Act has been computed. In addition thereto, reference has been made by Shri Vinay Kuthiala, learned senior standing counsel for the Revenue to the provisions of Section 149 of the Act, which prescribe the time limit for issuance of notice and reads as under:- 149. (1) No notice under Section 148 shall be issued for the relevant assessment year,- (a) if four years have escaped from the end of the relevant assessment year, unless the case falls under clause (b); (b) if four years, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the assessment proceedings in this case were conducted in accordance with the provisions of Section 143 of the Act i.e. scrutiny proceedings, which definitely entail a greater amount of scrutiny by the Assessing Officer as the term scrutiny itself postulates. 6. It has been contended on behalf of the Revenue that Section 147 of the Act itself starts with a clause that it is subject to provisions of Sections 148 and 153 of the Act and therefore, must be read subject to Section 149 of the Act. This argument may, at first blush, seem to be attractive but the words of the Statute have to be given a proper interpretation keeping in view the language of all the relevant provisions. 7. When we read Section 147 of the Act, especially the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l facts. 8. Finality has to be given to assessment proceedings. These cannot be reopened at the whims and fancy of the Revenue even when mistakes may have taken place. The law provides a procedure and also prescribes the limitation for taking such action. To take benefit of a power, which essentially is very wide power of virtually reopening the assessment, the Revenue must act within the time prescribed by the Act. 9. It has been contended on behalf of the Revenue that Section 149 of the Act lays down the limitation and since the income, which has escaped assessment in the present case, is more than Rs.1,00,000/- the limitation would be six years and in fact under the un-amended provision of Section 149, the limitation would be seven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,00,000/- the limitation is six years. This is the only interpretation which can be given to Sections 147 to 149. 12. While taking this view we are fortified by the judgment of the Allahabad High Court in Vikram Kothari (HUF) vs. State of Uttar Pradesh Ors., (2011) 242 CTR Reports, wherein the Allahabad High Court after considering the provisions of Sections 147,148 and 149 of the Act held as follows:- 13. Thus, on the plain reading of s. 147 and s. 149 legal position in respect of limitation emerges as follows:- (i) In view of proviso to s. 147 no action can be taken under s.147 beyond the period of four years if the case does not fall within the exception of the proviso mentioned in the proviso itself namely, if there is no case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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