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TMI Blog2022 (4) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... ner can be accused as having merely produced its books of accounts or other evidence during the course of assessment proceedings on the basis of which material evidence could not have been deduced by the Assessing Officer with the exercise of due diligence. Section 139 of the Act provides for mandatory obligations to furnish with its return of income the report of audit. Petitioner fulfilled its obligations. Petitioner had filed return of income alongwith audited Profit and Loss Account and balance-sheet as required under Section 139 of the Act. Balance-sheet being a part of the return of income under Section 139 of the Act, Petitioner cannot be stated to have not disclosed material facts. Petitioner having filed balance-sheet alongwith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o reopen assessment, that will certainly not be fatal to the assumption of jurisdiction under sections 147 and 148 of the Act. The Court in CROMPTON GREAVES LTD. [ 2014 (12) TMI 936 - BOMBAY HIGH COURT] held However, if from the reasons, no case of failure to disclose is made out, then certainly the assumption of jurisdiction under sections 147 and 148 of the Act would be ultra vires, being in excess of the jurisdictional restraints imposed by the first proviso to Section 147 of the Act . Having considered the reasons we are satisfied that even the reasons does not indicate there was failure to disclose truly and fully material facts. In fact there was nothing to indicate non-disclosure. Reasons itself rely on the balance-sheet and com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 25th March, 2014 under Section 148 of the Act to Petitioner stating that they have reasons to believe that Petitioner s income chargeable to tax for the assessment year 2007-2008 has escaped assessment within the meaning of Section 147 of the Act. Petitioner was also provided reasons for issuance of second notice which Petitioner states was received in the morning of 21st January, 2015. There are three issues raised in the second reopening which are as under : xxx It is seen from the perusal of the balance sheet of the assessee company that it has shown capital WIP of ₹ 36.84 crores as on 31.03.2006. However, no details with regard to nature of addition have been filed by the assessee company. Further, no separate cash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome, Mr. Pinto submitted that the assessing officer, in his order on objection dated 5th March, 2015, has accepted the explanation of Petitioner. Therefore what is required to be seen are only the other two items, viz., capital work in progress of ₹ 36.84 crores and ground rent of ₹ 1.28 crores offered under the income from other sources which should have been taxed as income from house property. 3] We have to note that reasons as quoted above clearly provides that information regarding first item, i.e., WIP has been obtained from the balance-sheet of the Company and 2nd item, ground rent, has been obtained from Profit and Loss account and computation of income of Petitioner. Therefore, information has been obtained from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extend beyond the full and truthful disclosure of all primary facts. Once all the primary facts are before the assessing authority, he requires no further assistance by way of disclosure. It is for him to decide what inferences of facts can be reasonably drawn and what legal inferences have ultimately to be drawn. It is not for somebody else-far less the assessee to tell the assessing authority what inferences, whether of facts or law, should be drawn. Indeed, when it is remembered that people often differ as regards what inferences should be drawn from given facts, it will be meaningless to demand that the assessee must disclose what inferences whether of facts or law he would draw from the primary facts. If, from primary facts, m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 147 and 148 of the Act. We would certainly agree with Mr. Pinto but as held in Crompton Greaves Ltd. (Supra), this is subject to the rider that there must be cogent and clear indication in the reasons supplied, that in fact there was failure on the part of the assessee to disclose fully and truly all the material facts necessary for its assessment. If the factum of failure to disclose can be culled from the reasons in support of the notice seeking to reopen assessment, that will certainly not be fatal to the assumption of jurisdiction under sections 147 and 148 of the Act. The Court held However, if from the reasons, no case of failure to disclose is made out, then certainly the assumption of jurisdiction under sections 147 and 148 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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