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TMI Blog2013 (11) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... of failure on the part of the assessee to fully and truly disclose material facts necessary for assessment of the year under consideration and the reassessment proceedings is also initiated beyond four years from the end of the assessment year and the earlier assessment was also made u/s 143(3) of the Act, initiation of reassessment proceedings is barred by limitation as per proviso to section 147 of the Act. Therefore, we hold that initiation of reassessment proceedings is not valid – Decided against the Revenue. - I.T.A. No.3154/M/12 - - - Dated:- 6-11-2013 - Shri B. R. Mittal And Shri Rajendra,JJ. For the Appellant : Shri Surendra Kumar For the Respondent : Shri B. V. Jhaveri ORDER Per B. R. Mittal, JM:- The department has filed this appeal for assessment year 2001-02 against order of ld. CIT(A) dated 15.02.12. 2. In grounds No.1 to 3 of the appeal the department has disputed the order of ld. CIT(A) to hold that notice issued under section 148 by the Assessing Officer is without jurisdiction/not valid and therefore the assessment order passed is annulled. 3. We have heard the ld. representatives of the parties and have perused the orders of the authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the reassessment proceeding has been initiated on account of failure by the assessee to disclose fully and truly the material facts due to which the income has escaped assessment because the assessment proceeding is initiated after the expiry of four years from the end of the relevant assessment year and the assessment order was also passed under section 143(3) of the Act dated 15.03.04. 8. In order to appreciate the action of the Assessing Officer, we consider it prudent to reproduce the relevant provisions of section 147 and 148 of the Act, which are as under: "147 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 provision 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 recompute 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 yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee to disclose fully and truly all material facts necessary for his assessment for that assessment year. It is also provided u/s.148(2) of the Act that before issuing notice to initiate reassessment proceedings, AO must record his reasons u/s.148 of the Act. 10. The Hon'ble Bombay High has held in the case of Hindustan Lever Ltd v/s R.B.Wadkar, Assistant Commissioner of Income Tax (2004), 268 ITR 232 (Bom) that reasons recorded must be based on evidence. That AO must disclose in the reasons as to which facts or material facts not disclosed by the assessee fully and truly which was necessary for assessment of that assessment year, so as to establish vital link between the reasons and evidence. Their Lordships have held that said vital link is the safeguard against arbitrary reopening of the concluded assessment. It was further held by Their Lordships in the above case that the reasons recorded by the Assessing Officer cannot be supplemented by filing an affidavit or making an oral submission. 11. Thus, Their Lordships of the Hon'ble Bombay High Court in the case of Hindustan Lever Ltd (supra) has mentioned that AO must disclose in the reasons as to which facts or materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is no dispute to the fact that the AO has not been conferred the power to review his own order. In this regard, the Hon'ble Bombay High Court has also held in the case of Asian Paints Ltd vs. DCIT, 308 ITR 195(Bom) that if the reassessment proceedings is initiated on the same set of facts, it would amount to change of opinion by the AO. Their Lordships have stated that the legislature has not confirmed power on the AO to review its own order. 14. Not only this, the Hon'ble Bombay High Court in the case of Titanor Components Ltd. Vs. Asstt. CIT ors 343 ITR 183 observed that where re-assessment is sought to be made after four years, the AO cannot take recourse to section 147 to correct and incorrect assessment made earlier since the mistake in the assessment so made is the result of the failure of the assessee to fully and truly disclose all the material facts necessary for the assessment. The said facts have to be stated by the AO in the reasons so recorded. In this regard, Their Lordships have considered the decision of its own court in the case of Hindustan Lever Ltd (supra) and the Division Bench at page 338 observed as under : "He must disclose in the reasons as to which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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