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TMI Blog2016 (7) TMI 1545X X X X Extracts X X X X X X X X Extracts X X X X ..... from the end of the relevant assessment year requires failure on part of the assessee. Not only there should be failure,what is important that it should be highlighted that as to how the failure took place. AO has not mentioned the very basic fact that would have given him the right to re-open the completed assessment.Secondly,it is also an admitted fact that the AO had not issued notice u/s.143(2) within the period of six months.Thus,on both the counts,order passed by the AO is invalid. Order of the FAA does not suffer from any legal infirmity.Confirming his order, we decide the effective ground of appeal against the AO. - ITA/64/Mum/2015, Assessment Years: 2006-07 - - - Dated:- 21-7-2016 - S/Shri Rajendra,Accountant Member and C.N. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7/12/2013,the assessee raised objections to the reopening of the assessment. After dealing with the objections and referring to the provisions of section 147 of the Act,the AO held that it was not a case of mere change of opinion. He recomputed the short-term capital gains on transfer of Bangalore unit under slumps a as per the provisions of section 50B of the Act. 3.Aggrieved by the order of the AO the assessee preferred an appeal before the First Appellate Authority(FAA).Before him, the assessee argued that the assessment proceedings were invalid is no notice u/s.143(2) of the Act was issued,that the reassessment proceedings had been initiated u/s.147 of the Act beyond the period of four years from the end of the subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of the AO.The Authorised Representative(AR)argued that in the reasons recorded by the AO for reopening the assessment there is no mention of failure of the assessee to disclose material facts,that in absence of alleged failure of an assessee matter cannot be reopened after a period of four years,that the AO had not issued notice u/s.143(2)of the Act within a period of six months and passed the reassessment order,that the order of the AO was ab-initio void.He relied upon the cases of Dynacraft Air Controls (355 ITR 102); Hindustan Lever Ltd. (268 ITR 332) and Interactive Marketing (ITA 6959/Mum/2012,dt.20.8.2014, A.Y. 2003-04). 5.We have heard the rival submissions and perused the material before us.Before proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account various judicial pronouncements. As such while computing Short Term Capital Gains on slump sale WDV of ₹ 2,25,48,408/- net of current year depreciation should have been taken. Hence, I have reason to believe that ₹ 2,60,35, 586/- of income chargeable to tax has escaped assessment for the A.Y.2006-07 within the meaning of sub-clause (iii) of clause (c) of Explanation 2 of section 147 of the Income Tax Act, 1961. The income chargeable to tax has escaped assessment is more than ₹ 1 lakhs. 5.1A cursory look at the reasons clearly reveal that there was no failure on part of the assessee to disclose truly and fully the material facts necessary for making assessment.Provisio to sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the income chargeable to tax which has escaped assessment must be occasioned, inter alia, by reason of the failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment, for that assessment year. Thus,the legal position is very clear-any reassessment after a period of four years from the end of the relevant assessment year requires failure on part of the assessee.Not only there should be failure,what is important that it should be highlighted that as to how the failure took place. In the case under consideration the AO has not mentioned the very basic fact that would have given him the right to re-open the completed assessment.Secondly,it is also an admitted fact that the AO h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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