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TMI Blog2020 (11) TMI 170X X X X Extracts X X X X X X X X Extracts X X X X ..... For the Respondent : Shri Dhrubajyoti Ray, JCIT, DR ORDER PER S.S.GODARA, JUDICIAL MEMBER:- This Revenue s appeal and assessee cross objection for assessment year 2012- 13 arise against the Commissioner of Income Tax (Appeals)-2 Kolkata s order dated 30.08.2019 passed in case No.10471/CIT(A)-2/18-19 involving proceedings u/s 147 r.w.s. 143(3) of the Income Tax Act, 1961; in short the Act . Heard both the parties. Case file(s) perused. 2. For the reasons stated in the Revenue s condonation petition and on account of assessee s no objection, we condone one day s delay in filing of the Revenue s appeal ITA No.2396/Kol/2019 . The case is now taken up for adjudication on merits. 3. The Revenue s twin substantive grounds raised in respect to the instant appeal inter alia plead that the CIT(A) has erred in law and on facts in quashing the Assessing Officer s action initiating sec. 148 r.w.s. 147 proceedings as merely based on conjecture and surmises thereby deleting the sec. 68 addition of unexplained cash credits to the tune of ₹3,10,00,000/- and commission thereupon of ₹3,10,000/- @ 1% of the former 69C of the Act; respectively. The CIT(A) s det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material facts necessary for assessment and as such the action u/s 147 was not in accordance with law. The case the proceedings u/s.147 were not in accordance with law and accordingly the assessment is void-ab-initio and is illegal to be declared as null and void. The assessment has been reopened u/s 147 after expiry of 4 years. The earlier assessments were completed u/s 143(3). However, it appears from the assessment order now passed that nowhere in the reasons recorded the AO was satisfied that that income has escaped assessment for failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. I find that, it is evident from the reasons recorded that there is no whisper-that-the income has escaped assessment for failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. When there is no case that there was failure on the part of the assessee to disclose all material facts necessary for assessment which is not whispered in the reasons recorded and for arguments sake even in the reassessment order the proceedings initiated u/s 147 is bad in law in view of various decisions cited as und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee's failure to furnish the material facts truly and fully. Any lack of comprehension on the part of the assessing officer in understanding the details placed before him cannot confer a justification for reopening the assessment, long after the period of four years had expired. On the facts of this case, it is clear that the escapement of income if any on this account is not on account of any failure on the assessee's part to disclose the material facts fully and truly. The notice issued by the assessing officer in exercise of his power under section 147, therefore, cannot be sustained. The Gujarat High Court in the case of Garden Silk Mills Ltd reported 222 ITR 0027 has held that.- the notice was issued after four years when there was no failure on the part of the assessee to disclose material facts necessary far assessment The notice of reassessment was not valid and was liable to be quashed. Where an assessment under sub-section (3) of section 143 has been made for the relevant assessment year, notice under section 148 issued after expiry of four years from the end of the relevant assessment year quashed-because there was no material on record that Income c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lure on the part at the assessee to disclose fully and truly all material facts. the reopening of the assessment beyond the period of four years cannot be sustained . The .Bombay High Court in the case of Hindustan Lever Ltd.- reported 268 ITR 0332 has held that:- . The reasons recorded by the assessing officer nowhere state that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment of relevant assessment year, therefore, notice issued under section 148 beyond four years relevant assessment Year was barred by limitation . In the case in hand it is not in dispute that the assessment year involved is 1996-97. The last date of the said assessment year was 31-03-1997 and from that date of four years are counted, the period of four years expired on 01-03-2001. The notice issued on dated 05- 11-2002 and received by the assessee on 07-11-2002. Under these circumstances, the notice is clearly beyond the period of four years. The reasons recorded by the assessing officer nowhere state that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment of tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings which were concluded on the basis of assessment under section 143(3). On this short count alone the impugned notice is liable to be quashed and set aside. The Calcutta High 'Court in the case of Jay Shree Tea Industries Ltd reported 245 ITR 0567 has held that:- After completion of the assessment, the assessing officer had issued notice under section 148 read with section 147, to the petitioner, asking the petitioner that its income had escaped as deduction under section 32AB(S) allowed more than the amount permissible under section 32AB of the Act The petitioner has challenged this notice on the ground that the notice has been issued after four years from the end of the relevant assessment year. Therefore, before the issue of notice, the income Tax Officer should satisfy whether any income has escaped and that the assessee has failed to disclose fully and truly all material facts necessary for the assessment. Sustainable In circumstances of case, three is hardly any case of escapement of income and Secondly, department has failed to prove that assessee has failed to disclose fully and truly all material facts required for assessment of its i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , I find that the reasons recorded by the AO to justify reopening the assessment u/s. 147 fails and, therefore, the very assumption of jurisdiction to reassess the assessee fails. Since the AO failed to do so as discussed, the assumption of jurisdiction by him to reopen itself is corum non judice and, therefore, all subsequent action is null in the eyes of law. In view of above, I quash the reopening and consequence reassessment order framed by him. I view of above, these legal grounds of appeal are allowed . 4. We have given our thoughtful consideration to rival pleadings. Learned departmental representative is fair enough in not disputing the clinching fact that the Assessing Officer s re-opening reasons recorded in the present case forming part of CIT(A) s above extracted discussion has treated the assessment in issue to be sec. 143(3) processing whereas the fact remains that it was an instance of regular assessment u/s 143(3) of the Act having been framed on 25.03.2015. We make it clear that we are dealing with assessment year 2012-13 and the Assessing Officer had initiated u/s 148 proceedings vide his corresponding notice served on the assessee on 27.03.2018. We obser ..... X X X X Extracts X X X X X X X X Extracts X X X X
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