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TMI Blog2000 (9) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the impugned notice. - Hence, the writ petition is dismissed. - - - - - Dated:- 29-9-2000 - Judge(s) : G. S. SINGHVI., NIRMAL SINGH. JUDGMENT The judgment of the court was delivered by G.S. SINGHVI J. -This is a petition for quashing notice annexure P-9 dated March 25, 1995, issued by the Additional Commissioner of Income-tax, Special Range, Faridabad (respondent No. 2), under section 148 of the Income tax Act, 1961 (for short, "the Act"), to the petitioner. The petitioner filed a return for the assessment year 1991-92 declaring an income of Rs. 2,890. It claimed deduction under section 80-I of the Act on the premise that it had set up a new industrial unit. By an order passed under section 143(1)(a) of the Act, the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t year 1991-92 had escaped assessment within the meaning of section 147 of the Act. On the petitioner's demand, respondent No. 2 supplied detailed reasons which prompted him to initiate proceedings for reassessment. For the sake of convenience, notice annexure P-9 and the reasons contained in annexure P.11 are reproduced below: "Notice annexure P-11 Whereas I have reason to believe that your income in respect of which you are assessable chargeable to tax for the assessment year 1991-92 has escaped assessment within the meaning of section 147 of the Income-tax Act, 1961. I, therefore, propose to reassess the income for the said assessment year and I hereby require you to deliver to me within 30 days from the date of service of this not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order that deduction under section 80-I had been allowed on the profits of the company and not on the profits of a separate industrial undertaking and that too before setting off of b/f losses. Apparently due to non-disclosure of material and primary facts with regard to setting up of a separate industrial undertaking on the profits of which the assessee sought to claim deduction under section 80-I, income to the extent of deduction allowed (Rs. 4,11,380) has escaped assessment in terms of clauses (C)(iii) and (C)(iv) of Explanation to section 147. It is also noticed that there is no mention in the assessment order dated June 28, 1993, about the facts relevant to setting up of a separate unit since the income as aforesaid has e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tantiate its claim for deduction under section 80-I and when the true facts came to the notice of respondent No. 2, he issued notice under section 148. Shri A. K. Mittal argued that the impugned notice should be declared illegal and quashed because it amounts to an abuse of the power vested in respondent No. 2 to reopen the proceedings of assessment. He submitted that no material was available before respondent No. 2 on the basis of which he could believe that income of the petitioner had escaped assessment. Shri Mittal pointed out that the petitioner had placed all the documents before the Assessing Officer in the proceedings under sections 143 and 154 of the Act and, therefore, it cannot be said that there was any concealment of the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad escaped assessment. In Phool Chand Bajrang Lal v. ITO [1993] 203 ITTR 456, their Lordships of the Supreme Court interpreted section 147 of the Act and observed as under (page 477): "From a combined review of the judgments of this court, it follows that an Income-tax Officer acquires jurisdiction to reopen an assessment under section 147(a) read with section 148 of the Income-tax Act, 1961, only if on the basis of specific, reliable and relevant information coming to his possession subsequently, he has reasons, which he must record, to believe that, by reason of omission or failure on the part of the assessee to make a true and full disclosure of all material facts necessary for his assessment during the concluded assessment proceedin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax Officer arrives at a conclusion, after satisfying the twin conditions prescribed in section 147(a) of the Act, that the assessee had not made a full and true disclosure of the material facts at the time of original assessment and, therefore, income chargeable to tax had escaped assessment.... 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 a travesty of justice to allow the assessee that latitude." In Raymond Woollen Mills Ltd. v. ITO [1999] 236 ITR 34, their Lor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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