9911796707
TMI Blog2012 (7) TMI 659X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner, a private limited company, which is engaged in the job work of dyeing and printing of art silk cloth, filed its return of income on 30.11.2003 for the assessment year 2003-04 along with the relevant documents declaring a loss of Rs.16,41,500/-. The case of the petitioner came to be taken for scrutiny and ultimately assessment came to be framed under section 143(3) of the Act on 31.12.2004. Subsequently, by the impugned notice, the assessment is sought to be reopened. The petitioner requested the Assessing Officer to furnish the reasons recorded for reopening the assessment, which came to be supplied alongwith a notice under section 143(2) of the Act. The reasons recorded by the Assessing Officer for reopening the assessment read a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all material facts necessary for its assessment. It was also contended that according to the Assessing Officer, the assessee had understated turnover of Rs.1,53,61,157/- which needs to be investigated in depth. That for taking action under section 147 of the Act, there should be reason to believe that income chargeable to tax has escaped assessment, whereas in the present case, there no new information has been collected by the Assessing Officer and that assessment cannot be reopened for making roving inquiry or collecting new information. By an order dated 22.09.2009, the reasons came to be rejected, which has given rise to the present petition. 4. Mr. M. J. Shah, learned advocate for the petitioner vehemently assailed the action of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnover of the year under consideration and that the Assessing Officer is of the opinion that the turnover is understated and requires to be investigated in depth. Thus, what the Assessing Officer seeks to do is to make a roving inquiry and to ascertain as to whether any income chargeable to tax has escaped assessment. For taking action under section 147 of the Act, there should be reason to believe that any income chargeable to tax has escaped assessment and that assessment cannot be reopened for the purpose of making a roving inquiry or collecting information. 5. Opposing the petition, Mr. Sudhir Mehta, learned senior standing counsel for the respondent, placed reliance upon the reasons recorded for reopening the assessment as well as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there is nothing whatsoever to indicate that there is any failure on the part of the petitioner to disclose fully and truly all material facts. The Assessing Officer, on an arithmetical calculation of the turnover of the previous years and raw material consumed as against raw material consumed in the year under consideration, has come to the conclusion that considering the ratio of raw material consumed in the previous year and in the current year, the turnover should be higher than that stated by the petitioner. Thus, the Assessing Officer has not formed any belief that any income chargeable to tax has escaped assessment but is of the view that the turnover to the extent the Assessing Officer believes that the assessee had understated t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. Under the circumstances, it is apparent that there is no failure on the part of the petitioner to disclose fully and truly all material facts necessary for its assessment for the assessment year under consideration and as such, the assumption of jurisdiction by the Assessing Officer under section 148 of the Act after the expiry of a period of four years from the end of the assessment year under consideration is bad in law. Consequently the impugned notice under section 148 of the Act is rendered unsustainable. 8. For the foregoing reasons, the petition succeeds, and is, accordingly allowed. The impugned notice dated 24.03.2009 issued by the respondent under section 148 of the Act is hereby quashed and set aside. Rule is made absolute a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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