Validity of reopening of Assessment If Assessing Officer failed to disclose the basis on which he formed the opinion that income chargeable to tax had escaped assessment

By TG Team Income Tax Judiciary October 9, 2009

TaxGuru Citation: 2009 taxguru.in 350
Case Name: Shipra Srivastava Vs ACIT (Delhi High Court)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Courts: All High Courts, Delhi High Court

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RELEVANT PARAGRAPH

3. Before us Mr. O.S. Bajpai, the senior counsel appearing for the petitioners has vehemently contended that the notices in question are clearly misconceived and are simply for harassing the petitioners who are professionals. The counsel has contended that the reasons which have been given for reopening of the assessment do not show that any new material has come to light for reopening of the assessment or that on the reasons stated there can be said to be that the officer had „reasons to believe for initiating reassessment. So far as the issue of incorrect valuation of the perquisite of the rent free accommodation provided by the employer, the counsel has contended that there is no material before the officer for holding that the assessee was occupying rent free accommodation given by his employer at A-13, EHIRC, Residential Tower, Okhla Road, New Delhi inasmuch as in fact and reality both the assessees had shifted from this accommodation way back in August 2001 when the petitioners moved into their own accommodation at Shipra Sun City. In fact thereafter the assesses were no longer in Delhi from August 2003 as they were posted by their employers to Raipur, Madhya Pradesh and from where they came to Delhi only on 30.6.2007. counsel contended that it is not understood as to how the officer has taken the EHIRC residential tower address as having been supplied to the assessee as rent free accommodation by his employer as the return did not disclose this as a perquisite, and whereas in fact along with the return a TDS form was filed showing perquisite at Rs. 27,000/- on account of the House Rent Allowances (HRA) provided to the assessees jointly at Rs. 54,000/- being the accommodation which the company has taken on lease for providing to its employees at Raipur. The petitioner. The petitioners, according to the learned senior counsel, rightly calculated the perquisite in this regard at Rs. 27,000/- for each of the petitioners because the employer himself had given a TDS certificate after due calculation valuing these perquisites at Rs. 27,000/- for each of the petitioners. According to the counsel, this perquisite was correctly worked out for the assessment year 2005-2006 in terms of Rule 3 Table 1, The relevant part with the facts in question is reproduced below:

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Circumstances

Where accommodation is