Case Law Details
DCIT Vs Daimler India Commercial Vehicles Private Ltd. (Madras High Court)
In the present case on hand, the appellants clearly stated the reason for reopening that particular fact has not been disclosed fully and truly in the assessment proceedings and so whether the assessee had disclosed it or not, can be decided by the authorities concerned. The respondent has got every right to make its submission during the enquiry under the reassessment proceedings and can furnish the required documents in support of its stand and if the statutory authority, not considered all the grounds, the assessee has right of appeal under the statutory provisions. Therefore, these questions cannot be decided in the writ Further, there is no prejudice caused to the respondent/assessee. The appellants/Revenue have not passed any final order of reassessment in respect of the tax liability that escaped assessment. They only sought for filing the returns in the prescribed form. The assessee can very well file returns in the prescribed form and make its submissions and objections and the assessing officer can consider the same and pass the re-assessment order. If the respondent/assessee is not satisfied with the order passed by the appellants, they have a right of filing statutory appeal.
After a bare perusal of the records, it is found that there is no violation of procedures since the reopening of the assessment is permitted under law. There is no bar for reopening of the assessment under Section 147 of the Act and that various circumstances are provided under the provisions of Section 147 for reopening of the assessment. Reasons are provided for reopening of the assessment in order to protect the revenue and to ensure that the Assessees are brought under the Taxnet in respect of the entire income. Such circumstances are enumerated in Section 147 to ensure that the Act is implemented in its letter and spirit and the object is achieved. The language employed in Section 147 of the Act is that “If the Assessing Officer ‘has reason to believe’ that any income may, subject to the provisions of Section 148 to 153 of the Act, assess or reassess such income and also any other income chargeable to tax which as escaped assessment and which comes to his notice”. Further, the respondent/assessee has got every chance to raise his objections in reassessment proceedings. Therefore, no prejudice would be caused to the respondent/assessee. The respondent has got statutory remedy after passing the re-assessment order.
There are chances and possibilities that the tax payer not filing the returns properly or the taxing authority due to oversight or mistake or various other reasons at the time of scrutinising the returns, not assessed properly. The tax payer by taking advantage of such error or omission, would evade payment of tax and it may lead to revenue loss. Therefore, the main purpose of reopening the assessment order is that in the original assessment, if the income liable to tax has escaped assessment due to oversight, inadvertence or any other mistake committed by the ITO, as per the provisions contained in section 147 of the Income Tax Act, 1961, if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment. Further, the Assessing Officer may assess or reassess income in respect of any issue which comes to his notice subsequently during the course of re-assessment, even though such an issue was not covered under the reasons recorded for reopening the assessment. Therefore, the citations referred to by the learned counsel for the respondent and judgments referred to by the learned Single Judge in the order in writ petition are not applicable to the present case on hand.
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