The Appellate Tribunal held that the issues on which the ...

Income tax reassessment order revised by Commissioner on new grounds not based on original reasons.

Case Laws Income Tax

November 8, 2024

The Appellate Tribunal held that the issues on which the reassessment order was passed u/s 147 read with Section 143(3) and the issues on which the revision order was passed u/s 263 were entirely different. The Assessing Officer had made inquiries during the reassessment proceedings in line with the recorded reasons and accepted the returned income without making any additions. Section 263 does not empower the Commissioner to circumvent provisions by directing an inquiry on an independent issue when no addition was made based on the grounds for reopening. The Tribunal applied the legal maxim 'sublato fundamento cadit opus,' meaning 'the foundation being removed, the superstructure falls.' If the initial action is not in consonance with law, all subsequent proceedings would fail as illegality strikes at the root. The exercise of suo motu revision power is a quasi-judicial act based on the formation of an opinion regarding the existence of adequate material to satisfy that the Assessing Officer's decision is erroneous and prejudicial to revenue interests. The revision of the order passed u/s 147 read with Section 143(3) by the Commissioner u/s 263, being contrary to the mandate of law, could not be sustained and was liable to be struck down.

View Source

← Previous Next →

The Appellate Tribunal held that the issues on which the ...

Income tax reassessment order revised by Commissioner on new grounds not based on original reasons.

Case Laws Income Tax

November 8, 2024

You may also like:

The Department initiated the case based on income tax documents, which were public documents, and the presumption is on their truthfulness. The difference in value based...

Income tax liability of employees - Remission of income tax liability borne on behalf of the employees - it is also possible that earlier years the assessee has not...

The Assessing Officer (AO) reopened the assessment solely based on the information from a survey conducted by the Sales Tax Department, without independently examining...

Legal interpretation of the term "original asset" for claiming exemption u/s 54F of the Income Tax Act. It discusses the ownership rights over the "original asset" by...

The assessee had been following the mercantile system of accounting, wherein book profits are taken for tax assessment, though credit or debit amounts may not be...

The summary highlights the key difference between the scope of total income under the Income Tax Act and the Black Money (Undisclosed Foreign Income and Assets) and...

Formation of belief by the Assessing Officer that income has escaped assessment is the crux of the reopening provision. The reasons recorded must be based on tangible...

Duty of AO to Guide the Assessee - Considering the specific facts on record that the assessee is non resident the amount which the ld. AO has taxed is earned and sourced...

Section 147/148 proceedings can only be initiated based on the original reasons recorded for forming the opinion of escapement of income. The Assessing Officer cannot...

Income Tax: The proposed amendment to section 198 aims to widen the tax base and address tax avoidance by deeming all sums deducted as tax in India and abroad, for which...

Reopening of assessment u/s 147 - reason to suspect v/s reason to believe - The reasons disclosed and placed on record do not allude to the material that was available...

Penalty levied by the AO u/s. 271AAB r.w.s. 274 - levy penalty of 30% on undisclosed income - the reasons given by the AO to levy 30% penalty on undisclosed income is...

Proposed amendment enables recovery of existing liabilities under Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 from seized assets...

Reopening of assessment u/s 147 - reasons to believe - no income under the head income from House Property has been offered by the assessee during the year under...

Penalty levied u/s 274 read with Section 270A - assessee computed tax on disallowed depreciation amount at maximum marginal rate and levied 200% penalty on payable tax -...

Quick Updates: