Even if assessee makes a wrong claim of deduction but the same was allowed by the AO, assessment can be reopned only if any failure to make full disclosure is attributed to the assessee

Titanor Components Ltd Vs ACIT, Panaji -(High Court of Bombay at Goa) – The power conferred by Section 147 does not provide a fresh opportunity to the AO to correct an incorrect assessment made earlier unless the mistake in the assessment so made is the result of a failure of the assessee to fully and truly disclose all material facts necessary for assessment. Indeed, where the assessee has fully disclosed all the material facts, it is not open for the AO to re-open the assessment on the ground that there is a mistake in assessment. Moreover, it is necessary for the AO to first observe whether there is a failure to disclose fully and truly all material facts necessary for assessment and having observed that there is such a failure to proceed under Section 147. It must follow that where the AO does not record such a failure he would not be entitled to proceed under Section 147.

 IN THE HIGH COURT OF BOMBAY AT GOA

WRIT PETITION NO. 71 OF 2005

 Titanor Components Limited,
A Company registered under the Companies Act, 1956 and having its registered office at Plot No.184-185-189, Kundaim Industrial Estate, Goa. … Petitioner

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