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TMI Blog2015 (7) TMI 920X X X X Extracts X X X X X X X X Extracts X X X X ..... Society. The Petitioner filed its return for the Assessment Year 2001-02. A notice of scrutiny assessment under Section 142(1) of the Act was issued on 27 August 2002. Reply to the notice was submitted by the Petitioner on 29 October 2002. No further action pursuant to the notice was taken by the respondents. On 15 March 2007, the Petitioner received a notice under Section 148 seeking to reopen the assessment. The Petitioner replied by the letter dated 9 April 2007 stating that the original return filed on 31 October 2001 be treated as return under Section 148 without prejudice to the challenge the legality of the reassessment. By letter dated 3 May 2007, the Respondent No.1 supplied grounds for reopening the assessment. By letter dated 31 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are being taken out. Further, the Assessing Officer is not permitted to improve upon the reasons so furnished to the assessee. Thus, the validity of the initiation of the assessment proceedings will be determined only by the reasons furnished by the Assessing Officer to the assessee. If the reassessment proceedings are to be initiated after a period of four years on the ground that the assessee failed to make full and true disclosure of all necessary facts, then, the Assessing Officer must state so in the reasons and the action must be founded on such reason. 7. In the present case, reasons were furnished to the Petitioner by the Assessing Officer. The reasons for reopening as forwarded to the petitioner as under : "The assessee had fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee Society. However, the assessee has not disclosed any income as taxable in its hands. In the immediately preceding year i.e. A.Y. 2000-01, the assessee had filed its return of income on 18.08.2000, declaring the total income at Rs.NIL, but the assessment was finalized under Section 143(8) r/w S.147 on 28.11.2003, determining the assessed income at Rs. 1,21,22,995/-. The additions made in this assessment order were as follows: 1. On account of Transfer premium charged from the transferor and transferee only at the time of transfer of flats. Rs.21,28,300/- 2. Amount received from outside parties for using the assessee's premises for their own business purposes. Rs.10,88,700/- 3. Miscellaneous Expenses being charges from Mem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ora of decisions in which it has been held again and again that any receipt in the hands of a CHS which is collected from an outside party in lieu of services, or license to use a part of the premises for furthering its own business interest, is liable to be taxed as income in the hands of the Society u/s 56, and cannot be construed as covered by the principal of mutuality, by any stretch of imagination. It would not be out of place to mention here that the Bombay High Court judgments are based upon Supreme court decisions such as Bankipur Club Ltd. And Kumbakonan Mutual Benefit Fund Ltd. Under the circumstances, I have reason to believe that income chargeable to tax in excess of Rs. 1 lakh has escaped assessment within the meaning of Sec. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; reports. All these documents were all furnished by the Petitioner during the assessment. There is not a whisper in the reasons that the Petitioner failed to make full and true disclosure of any relevant facts or that the Petitioner withheld such necessary facts, and therefore reopening of the assessment is necessary. Nor does the reading of the reasons as a whole indicate that it is being suggested that there was a failure on the part of the Petitioner to disclose fully and truly all material facts necessary for assessment. 8. Not only it is not mentioned in the reasons that the Petitioner failed to disclose all the necessary facts as required, but the perusal of the reasons would show that all the necessary and relevant facts were in fa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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