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TMI Blog2019 (6) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... isclose fully and truly all material facts necessary for his assessment for that assessment year. Therefore, reopening of assessment by issuance of notice u/s 148(2) on 27/3/2015 is bad in law and consequently the order passed in pursuance to such notice is also bad in law. - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... as erred in law and on facts in upholding reopening of the assessment under section 147 of the Income-tax Act, 1961 on the basis of purported Income Tax Inspector Report. 13. That the Ld. A.O. has erred in law and on facts in initiating proceedings under section 147 of the Income Tax Act, 1961 on the basis of erroneous facts having no live link with the material on record. Therefore, the impugned assessment order is illegal and void ab-initio. 14. That the Ld. C.l.T.-l. Kanpur has mechanically given the approval under section 151 of the Income Tax Act, 1961for issue of Notice under section 148 of the Income Tax Act, 1961, therefore, the impugned assessment order is illegal and void-abinitio and liable to be quashed. Reliance is placed on the judgment of jurisdictional High Court in the case of Mohan Dairy Vs. Union of India (2007) 163 Taxman 274 (All.)" 3. The ld. D.R. had no objection to accepting modified ground No.12 of the appeal as well as accepting additional grounds of appeal of the assessee. Hence, they are admitted for hearing. 4. In ground No.9 of the appeal, the grievance of the assessee is that there is no averment in the reasons recorded that the assessee has f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of notice u/s 148. The same is being requested separately." 6. On the above stated facts, we find that in the instant case reopening of assessment has been made after expiry of four years from the end of relevant assessment year after passing original assessment order under section 143(3) on 31.10.2010. Proviso to section 147 states that where an assessment is made under section 143(3) of the Act, no action shall be taken under this 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. A bare perusal of the above recorded reasons shows that there is no whisper in the reasons recorded by the Assessing Officer that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for that assessment year. Therefore, reopening of assessment by issuance of notice under section 148(2) on 27/3/2015 is bad in law and consequently the order passed in pursuance to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacturing Co. v. Commissioner of Income-Tax and Anor. reported in [2009] 308 ITR 38 (Delhi) has held as follows: "26. Viewed in this light, the proviso to section 147 of the said Act, carves out an exception from the main provisions of section 147. If a case were to fall within the proviso, whether or not it was covered under the main provisions of section 147 of the said Act would not be material. Once the exception carved out by the proviso came into play, the case would fall outside the ambit of section 147. 27. Examining the proviso [set out above], we find that no action can be taken under section 147 after the expiry of four years from the end of the relevant assessment year if the following conditions are satisfied: (a) an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year; and (b) unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee: (i) to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148; or (ii) to disclose fully and truly all material fa ts necessary fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uli Chand Singhania (supra) that, in the absence of an allegation in the reasons recorded that the escapement of income had occurred by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment, any action taken by the Assessing officer under section 147 beyond the four year period would be wholly without jurisdiction. Reiterating our view-point, we hold that the notice dated 29.03.2004 under section 148 based on the recorded reasons as supplied to the petitioner as well as the consequent order dated 02.03.2005 are without jurisdiction as no action under section 147 could be taken beyond the four year period in the circumstances narrated above. 12. In these circumstances, there was no justification for assumption of jurisdiction by the Assessing Officer for reopening proceedings under section 147 of the Act. The entire proceedings initiated pursuant impugned notice, therefore, were without jurisdiction and as such could not be sustained. Hence, we cancel the reassessment order passed under section 147 read with 143(3) of the Act dated 29/3/2016 and allow this ground of appeal of the assessee. 13. As we have cancelled ..... X X X X Extracts X X X X X X X X Extracts X X X X
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