Discovery Communications India Vs ACIT (Delhi High Court)
Delhi HC order whether reassessment u/s 147 permissible for AO after closure of proceedings u/s 143 resulting in under assessment of income
The Delhi High Court has made it clear that once scrutiny assessment is held under Section 143 of the Income Tax Act but due to a mistake of the Assessing Officer there is under assessment of income, reopening assessment under Section 147 of the Income Tax Act, 1961 is not permissible.
“…AO specifically records in the reasons that it was a ‘mistake’ which resulted in under assessment of the income…It is, therefore, manifest that AO has not attributed the alleged escapement of income to any failure on the part of petitioner but to a mistake and lack of verification on its own part. Petitioner cannot be allowed to suffer because of lapse of the AO.,” a division bench of Justices Yashwant Varma and Ravinder Dudeja observed.
Assessment cannot be reopened under Section 147 of the Act merely on the basis of change of opinion beyond the period of four years when there was no fault on the part of the assessee to disclose truly and completely the material particulars. In this regard, we may refer to some of such judgments of the Supreme Court and of our own High Court. In CIT v. Goetze (India) Ltd. [2010] 229 CTR 167 (Delhi), reliance was placed on the judgment of CIT v. Kelvinator of India Ltd. (2002) 174 CTR (Delhi) 617, wherein, it was specifically observed that when a regular order of assessment is passed in terms of Section 143(3), presumption can be raised that such an order has been passed on application of mind.
