Case Law Details
Bharat Chimanlal Parekh Vs ITO (ITAT Mumbai)
Undisputedly, the assessee has voluntarily filed his return of income within the time prescribed under section 139(1) of the Act and the assessment was completed under section 143(3) of the Act. On a perusal of the documents placed in the paper book, it is very much evident, in course of original assessment proceedings the Assessing Officer from time to time has called for various details from the assessee by issuing statutory notices under section 142(1) and 143(2) of the Act and the assessee has duly complied with them. The aforesaid facts clearly indicate that the Assessing Officer while completing the assessment under section 143(3) of the Act has applied his mind not only to the return of income along with computation of total income filed by the assessee, wherein, various sources of income including the exempt income earned during the year have been duly disclosed, but has also made enquiries with regard to the source of interest income and expenditure. Undisputedly, the Assessing Officer has re–opened the assessment under section 147 after expiry of four years from the end of the impugned assessment year. Therefore, the proviso to section 147 of the Act would apply. As per the said proviso, only in a case where there is failure on the part of the assessee to disclose fully and truly all material facts, the Assessing Officer retains the power to re–open the assessment under section 147 of the Act, in case, the original assessment has been completed under section 143(3) of the Act. In the present case, the reasons recorded for re–opening the assessment which has been reproduced in Para–2 of the assessment order clearly reveals that the Assessing Officer has not alleged any failure on the part of the assessee to truly and correctly disclose all material facts relating to his assessment.Rather, the reasons recorded clearly reveal that the Assessing Officer simply on perusal of materials already available on record i.e., the Balance Sheet and other material has formed a belief that due to non–disallowance of expenditure under section 14A r/w rule 8D, there is escapement of income. In my view, the aforesaid facts clearly established that basic conditions of the proviso to section 147 of the Act have not been fulfilled. That being the case, the re–opening of assessment under section 147 of the Act in the present case is invalid. Therefore, the assessment order passed under section 143(3) r/w section 147 of the Act deserves to be quashed.
FULL TEXT OF THE ITAT JUDGEMENT
The captioned appeal has been filed by the assessee challenging the order dated 6th December 2018, passed by the learned Commissioner of Income Tax (Appeals)–55, Mumbai, pertaining to the assessment year 2008–09.
2. The assessee has raised in total five grounds. Ground no.5, being general in nature does not require separate adjudication.
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