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TMI Blog2013 (1) TMI 945X X X X Extracts X X X X X X X X Extracts X X X X ..... or the A.Y. 1996- 97, the assessee filed a return of income on 29.01.1996 declaring a total income of ₹ 75,60,330. Finally assessment was made u/s. 143(3) of the Act on a total income of ₹ 86,07,960. The addition made to the returned income was disallowance of depreciation claimed on share of ₹ 9,31,550. 4. There was a survey conducted u/s. 133A of the Act in the business premises of one M/s. Bellary Steels Alloys Ltd. ( BSAL for short) on 10.09.2000. In the course of survey, it was found that BSAL was entering into lease transactions with various parties to avail of finance of nonexisting assets. According to the revenue, the survey proceedings revealed that SGCI Rolls said to have been procured from various financial institutions in fact did not exist. The assessee in the A.Y. 1996-97 had claimed depreciation at 100% of ₹ 1,02,47,453 of SGCI Rolls leased to BSAL. According to the AO, the survey referred to above proved that the lease transaction was fictitious and therefore depreciation on SGCI Rolls leased to BSAL claimed by the assesse and allowed in the assessment ought to be disallowed. The AO accordingly issued a notice u/s. 148 of the Act on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that under proviso to section 147 of the Act, where an assessment has already been made u/s. 143(3) of the Act and the said assessment is sought to be reopened u/s. 147 of the Act after expiry of four years from the end of the relevant assessment year, then escapement of income chargeable tot ax should be by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for that assessment year. The assessee submitted that admittedly the assessment of the assessee was already made u/s. 143(3) of the Act and the same was sought to be reopened after a period of four years from the end of relevant assessment year and therefore the condition contemplated by the proviso should be fulfilled for reopening of the assessment. The assessee submitted that the reasons recorded by the AO do not mention that there was any such failure on the part of the assesse. It was submitted that such a conclusion should be reached and recorded by the AO in the reason recorded for reopening the assessment u/s.147 of the Act. Failure on the part of the AO in this regard should result in the initiation of reassessment proceedings being regarded as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st the appellant. Grounds of appeal raised in Ground Nos.1,2,3 4 and 6 are dismissed. 9. Aggrieved by the order of the CIT(Appeals), the assessee has raised ground No.2 before the Tribunal. We have heard the submissions of the ld. counsel for the assessee and the ld. DR. The ld. counsel for the assessee after making a reference to the reasons recorded by the AO before issue of notice u/s. 148 of the Act submitted that nowhere in the reasons recorded by the AO, has the AO mentioned the fact that there was failure on the part of the assessee to disclosed fully and truly all material facts necessary for the assessment for the A.Y. 1996-97. Our attention was drawn to the decision of the Hon ble Bombay High Court in the case of Hindustan Lever Ltd. v. R.B. Wadkar (2004) 137 Taxmann 479 (Bom) . In the aforesaid case, the question that arose for consideration was with regard to the validity of the initiation of reassessment proceedings u/s. 147 of the Act in a case where assessment had already been completed u/s. 143(3) of the Act and notice u/s. 148 was issued after expiry of a period of four years from the end of the relevant assessment year. The Hon ble Bombay High Court after n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19.09.2011 , wherein the Hon ble Karnataka High Court after making a reference to the decision of the Hon ble Bombay High Court in the case of Hindustan Lever Ltd. (supra) observed as follows:- 7. It is observed in the said judgment that the reason recorded by the Assessing Officer no where state that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment of that assessment year. It is for the Assessing Officer to disclose and open his mind through reasons. He has to speak through his reasons. It is for the Assessing Officer to reach the conclusion as to whether there was failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for the-concerned assessment year. It is for the Assessing Officer to form his opinion. It is for him to put his opinion on record in black and white. The reasons recorded should be clear and unambiguous and should not suffer from any vagueness. The reasons recorded must disclose, his mind. The reasons are the manifestation of the mind of the Assessing Officer. The reasons recorded should be self-explanatory and should not keep the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kes place within a period of four years of the end of the relevant assessment year. In the case of the assessee, the condition precedent to the invocation of the jurisdiction was clearly absent since there was not even an averment to the effect that there was a failure on the part of the assessee to disclose fully and truly all the material facts necessary for the assessment. Thus, the Assessing Officer had clearly acted in excess of jurisdiction in purporting to reopen the assessment, beyond a period of four years for the assessment year 2004-05 by his notice. 12. It was thus submitted by the ld. counsel for the assessee that reopening of the assessment should be held to be bad in law, as the AO in the present case has not recorded specifically that escapement of income was due to the failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for the A.Y. 1996-97. 13. The ld. DR, on the other hand, relied on the order of the CIT(Appeals) and decisions referred to by him in his order. We have already seen that the decisions referred to by the CIT(A) in his order did not deal with the proviso to Sec.147 of the Act where the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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