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TMI Blog2015 (2) TMI 330X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee cannot be charged for any omission. In case the assessee had laid a claim to a particular amount, it was the job of the Assessing Officer to correctly compute the tax liability. Merely making a claim cannot be stated to be non-disclosure of material facts so as to vest in the Assessing Officer jurisdiction under section 147 of the Act. See Parashuram Pottery Works Co. Ltd. vs. Income-tax Officer reported in [1976 (11) TMI 1 - SUPREME Court] and Cadila Healthcare Ltd vs. Deputy Commissioner of Income-tax reported in [2010 (5) TMI 570 - Gujarat High Court ]. - Decided in favour of the assessees - Tax Appeal No. 1771 of 2005, Tax Appeal No. 1772 of 2005 - - - Dated:- 10-12-2014 - KS Jhaveri And K. J. Thaker,JJ. For the Appellant : Mr R K Patel, Adv. For the Respondent : Mr Pranav G Desai, Adv. JUDGMENT (Per : Honourable Mr. Justice KS Jhaveri) 1. Being aggrieved and dissatisfied with the impugned orders passed by the Income Tax Appellate Tribunal, Rajkot Bench (hereinafter referred to as 'the Tribunal') dated 28.07.2005 in ITA Nos. 558/RJT/2003 559/RJT/2003 for the Assessment Years 1994-95 respectively, the revenue has preferred the present Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In support of his submissions, Mr. Patel has relied upon the decision of the Apex Court in the case of Parashuram Pottery Works Co. Ltd. vs. Income-tax Officer reported in [1977] 106 ITR 1 (SC) and decision of this Court in the case of Cadila Healthcare Ltd vs. Deputy Commissioner of Income-tax reported in [2011] 334 ITR 420 (Guj). 4. Mr. P.G. Desai, learned advocate appearing for the revenue supported the impugned order and contended that the same having been passed in accordance with law does not call for interference by this court. He has drawn the attention of this Court to section 147 of the Act as well as decision of the Apex Court in the case of Phool Chand Bajrang Lal and Another vs. Income-Tax Officer and another reported in [1993] 203 ITR 456. 5. We have heard learned advocates for the parties and gone through the records of the case. At the outset we think it appropriate to have a look at section 147 of the Act and the same is reproduced hereunder: 147. Income escaping assessment.- 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome 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. Explanation 3.-For the purpose of assessment or reassessment under this section, the Assessing Officer may assess or reassess the income in respect of any issue, which has escaped assessment, and such issue comes to his notice subsequently in the course of the proceedings under this section, notwithstanding that the reasons for such issue have not been included in the reasons recorded under sub-section (2) of section 148. 5.1 Thus, it is clear that section 147 of the Act provides for the reopening of assessment proceedings and gives discretion to the Assessing Officer to reopen the assessment proceedings when he/she has reason to believe that some of the income has escaped assessment. Section 147 can be evoked within period of four years from the relevant assessment year. Under the first proviso to section 147, where an assessment has been made u/s 143(3) the assessment cannot be opened after the expiry of four years from the relevant assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase. The appeal is consequently allowed; the judgment of the High Court is set aside and the impugned notices are quashed. The parties in the circumstances shall bear their own costs throughout. 6.1 Similarly, this Court in the case of Cadila Healthcare (supra) has observed as under: 10. It is well settled as held by the Supreme Court in a catena of decisions which have been referred to in the memo of petition that the duty which is cast upon the assessee is to make a true and full disclosure of the primary facts at the time of the original assessment. Production before the Assessing Officer of the account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer will not necessarily amount to disclosure contemplated by law. The duty of the assessee in any case does not extend beyond making a true and full disclosure of primary facts. Once he has done that his duty ends. It is for the Assessing Officer to draw the correct inference from the primary facts. It is no responsibility of the assessee to advise the Assessing Officer with regard to the inference which he should draw from the primary facts. If an Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ang Lal (supra). In the said decision, the Apex Court has observed as under: 28. We are not persuaded to accept the argument of Mr. Sharma that the question regarding truthfulness or falsehood of the transactions reflected in the return can only be examined during the original assessment proceedings and not at any stage subsequent thereto. The argument is too broad and general in nature and does violence to the plain phraseology of Sections 147(a) and 148 of the Act and is against the settled law by this Court. We have to look to the purpose and intent of the provisions. One of the purposes of Section 147, appears to us to be, to ensure that a party cannot get away by wilfully making a false or untrue statement at the time of original assessment and when that falsity comes to notice, to turn around and say you accepted my lie, now your hands are tied and you can do nothing . It would be travesty of justice to allow the assessee that latitude. 6.3 The decision in the case of Phool Chand Bajrang Lal (supra) shall not be applicable on the facts of the present case inasmuch as in the present case the reasons for reopening the assessment nor the order disposing of the objection ..... X X X X Extracts X X X X X X X X Extracts X X X X
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