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TMI Blog2022 (9) TMI 1422X X X X Extracts X X X X X X X X Extracts X X X X ..... . For this reason, the assessment was reopened by the Assessing Officer. We noted that in the case of TANMAC India Vs. Deputy Commissioner of Income Tax, Circle I, Pondicherry [ 2017 (1) TMI 122 - MADRAS HIGH COURT ] has considered an identical situation by following the decision of the Hon ble Supreme Court in the case of Commissioner of Income Tax Vs. Kelvinator of India [ 2010 (1) TMI 11 - SUPREME COURT ] and held that What is sought to be done by the re-assessment ought to have been achieved by scrutiny assessment proceedings. Having missed the bus earlier, the Department cannot be permitted to avail of the extended time limit in the absence of any new or tangible material - Thus we quash the re-assessment and allow the appeal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 4. The Commissioner of Income Tax (Appeals) failed to appreciate that the lack of fresh materials and noncompliance of the principles laid down by the Apex Court in the case reported in 259 ITR 19 in conducting the re-assessment proceedings would vitiate the decision rendered from paragraph nos.4.3 to 4.3.2 of the impugned order. 5. The Commissioner of Income Tax (Appeals) failed to appreciate that having noticed the reliance of the decision of the Jurisdictional High Court by the Appellant, non-consideration of the principles laid down by the Jurisdictional High Court in the case of M/s. TANMAC India Limited would vitiate the decision rendered in confirming the validity of the reassessment. 3. The brief facts of the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an be booked, but that is not the case. Aggrieved, the Assessee preferred an appeal before the Commissioner of Income Tax (Appeals). 4. Before the Commissioner of Income Tax (Appeals), the Assessee challenged the validity of re-opening of the assessment but the Commissioner of Income Tax (Appeals) relying on the decision of the Hon ble Gujarat High Court in the case of Praful Chunilal Patel Vs. the Assistant Commissioner of Income Tax reported in 236 ITR 832 and the decision of the Hon ble Punjab and Haryana High Court in the case of the Venus Industrial Corporation Vs. The Assistant Commissioner of Income Tax reported in 236 ITR 742 and the decision of the Hon ble Bombay High Court in the case of Export Credit Guarantee Corporation of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appears to represent unexplained income that needs to be brought to tax now. The learned Counsel for the Assessee stated that the Assessing Officer has acted only on the issue of the first reason as reason Nos.2, 3 and 4 are not the subject matter of re-assessment. The learned Counsel for the Assessee stated that these reasons were very much available before the Assessing Officer during the course of the original assessment proceedings and the Assessing Officer has not made any addition during the original assessment that was framed u/s.143(3) of the Act vide order dated 28.03.2013. For this, the learned Counsel for the Assessee relied on the decision of the Hon ble Madras High Court in the case of TANMAC India Vs. Deputy Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permitted to avail of the extended time limit in the absence of any new or tangible material. The Hon ble Madras High Court has considered this issue in paragraph nos.10, 11 12, as under: 10. Let us now see the sequence of events that have transpired in this case. The Assessee filed a return of income pursuant to which, an intimation dated 01.12.1998 under section 143(1) (a) of the Act was issued. The provisions of Section 143(2) require that if the Assessing Officer considered it necessary or expedient to ensure that the Assessee has not understated income, claimed excessive loss or underpaid tax in any manner, the assessment is to be subject to further scrutiny, a notice under section 143(2) is liable to be issued and the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome from assessment. Reasons must have a link with the formation of the belief. 12. If the Assessing Officer, after issuing intimation u/s. section 143(1) does not to issue a notice u/s.143(2) of the Act to initiate proceedings for scrutiny of the return of income, the obvious conclusion is that he does not consider it necessary or expedient to do so, the inference being that the Return of Income filed in order. It is this opinion that cannot be arbitrarily changed by the Assessing Officer, to re-assess income on the basis of stale material, already on record. If, we thus keep in the mind, the above fundamental requirement of Section 147, it would be apparent that the exercise undertaken by the Revenue in this case is not one of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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