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TMI Blog2014 (8) TMI 764X X X X Extracts X X X X X X X X Extracts X X X X ..... upon his case lately in form of grounds of appeal filed before us – the order of the FAA should have been accepted gracefully and the administrative approval should not have been given to file the second appeal - thus, the order of the FAA does not suffer from any legal or factual infirmity – Decided against revenue. - ITA No. 6959/Mum/2012 - - - Dated:- 20-8-2014 - S. Sh. Vijay Pal Rao And Rajendra,JJ. For the Petitioner : Shri Roopak Kumar For the Respondent : Shri Anil Sathe ORDER Per Rajendra, AM Challenging the order dt. 29. 08. 2012 of the CIT(A)-14, Mumbai, Assessing officer (AO) has raised following Grounds of Appeal: 1. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of ₹ 1, 13, 7, 046/- and ₹ 60, 11, 835/-. 2. 1. On the facts and circumstances of the case and in law, the Ld. CIT(A)erred in quashing/annulling the assessment order passed u/s. . (143)r. w. s. 147 of the I. T. Act despite the fact that the AO had obtained the sanction u/s. 151(2) of the I. T. Act, 1961. 2. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in not apprecia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure and holding that the assessee had claimed double deduction in respect of the said expenses. 3. Aggrieved by the order of the AO, the assessee filed an appeal before the First Appellate Authority (FAA) challenging the reopening of the assessment and the additions made by the AO. Before him, the assessee submitted that the action of the AO in reopening //the assessment was illegal as well as bad in law and hence the assessment order passed u/s. 147 r. w. s. 143(3) deserved to be quashed and cancelled, that the AO had acted beyond his jurisdiction in not following the provisions of section 147 of the Act because the assessment had been reopened beyond 4 years from the end of the relevant assessment year, that the AO had not demonstrated that the income had escaped assessment by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment for the relevant AY. , that the notice under section 148, had been issued by the Assessing Officer who was below the rank of Assistant Commissioner or Deputy Commissioner, that it had not been issued with the prior satisfaction and approval of the Joint Commissioner on the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r consideration no such prior approval/satisfaction of the Joint Commissioner had been reported by the AO, that the reopening on both those grounds wa liable to be held invalid, that as per proviso to section 151(1) of the Act, in a case where an assessment under section 143(3) or 147 had been made, no notice can be issued after 4 years from the end of the relevant assessment year unless the satisfaction/approval of the Chief Commissioner or Commissioner had been obtained on the basis of the reasons recorded for this purpose, that the AO had not reported any such satisfaction/approval of the Chief Commissioner or Commissioner, that on that ground also, the reopening was liable to be held invalid. Finally he held that the reopening of the assessment as well as the order passed by the AO, both were invalid, that the issuance of notice u/s. 148 of the Act and the consequent reassessment order were bad in law and could not be sustained, that same were to be quashed/ annulled. 4. Before us, the Departmental Representative (DR) supported the order of the AO and stated that prior approval was obtained from the CIT before issuing the notice u/s. 148 of Act, that all legal formalities we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edings beyond the period of four years from the end of the relevant assessment year. It is essential for the assessee to reveal the primary facts truly and fully but not the inferential facts as drawing the inferences would be the domain of the AO. We would like to refer to the judgment of the Hon ble jurisdictional High Court delivered in the case of Dynacraft Air Controls (356ITR102) wherein it has been held: Under section 147 of the Income-tax Act, 1961, for the Assessing Officer to reopen an assessment, he must have reason to believe that income chargeable to tax has escaped assessment for any assessment year. Under the proviso to section 147, where an assessment has been made under section 143(3), no action shall be taken under that section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment, for that assessment year. This is a jurisdictional requirement which must be fulfilled where an assessment is sought to be reopened beyond a period o ..... 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 for the assessment year under consideration, assumption of jurisdiction under section 147 was not valid and, therefore, notice under section 148 could not be sustained. From the above it is clear that provisions of the proviso to the section 147 of the Act cannot be invoked in a routine matter. The AO has to prove that certain pre-conditions for initiating reassessment proceedinsgs, were existing, if he desires to issue a notice u/s. 148. Once an assessment is completed u/s. 143 of the Act, after scrutinising the facts of the case, generally it should not be disturbed until and unless it is not proved that because of the failure of the assessee a portion of the income remained to be taxed in that particular AY. AO. s are not allowed to play a second innings if there is no failure on the part of the assessee to disclose material facts. In the case under consideration there is no proverbial whisper, in the reasons recorded by the AO, that because of the failure of the assessee to disclose fully and truly all the material facts income has escaped assessment. Thus, there is lack of basic jurisdiction. AO. s are empowered to issue not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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