Case Law Details
McKinsey Global Service India Private Limited Vs ACIT (Madras High Court)
6. The contention of the petitioner is that the principles laid down by the Hon’ble Supreme Court of India, re-opening of assessment proceedings in the case of GKN Driveshafts India Ltd., Vs. ITO reported in (2003) 259 ITR 19 (SC) has not been complied with. Thus, the impugned notice is liable to be set aside.
7. The authority competent under the Statute is expected to furnish reasons for every decision taken. Two components are of paramount importance. Adherence of the procedures contemplated, firstly and furnishing reasons for arriving a particular decision, thereafter. Thus, on initiation of re-opening proceedings by invoking Section 147 of the act, the Assessing Officer is obligated to follow the procedures contemplated and furnish the reasons for arriving a particular decision. In the present case, reasons are furnished for reopening of assessment. The objections are to be disposed of in a meaningful manner, in view of the fact that the reopening procedures in the present case falls beyond the period of four years and within six years. Thus, the ingredients contemplated in the proviso clause is to be complied with. Thus, the consideration of objections and the findings for reopening are of vital and in the absence of any reasons, one cannot form an opinion that reopening of assessment is made with reference to the conditions stipulated in the proviso clause to Section 147 of the Act. Conditions under the provisions are mandatory. In order to establish the compliance of conditions, the authority competent must provide reasons, stating that the conditions stipulated in the proviso clause has been complied with. Thus, a non-speaking order in this regard cannot be sustained and therefore, the impugned order is to be construed as lacking, on application of mind and the objections raised by the petitioner are not considered, nor a finding is given. Contrarily, the impugned order has been passed merely reproducing the provisions of the Statute, which is insufficient and therefore, this Court is inclined to consider the writ petition.
8. In view of the facts and circumstances, the impugned notice issued by the respondent in proceedings in PAN No.AAACV3342H dated 04.03.2016 issued under Section 143(2) of the Income Tax Act is quashed and the matter is remanded back to the respondent for fresh consideration by following the procedures as contemplated. The respondent is directed to follow the procedures as contemplated under the provisions of the Act and the principles laid down by the Apex Court in the case of GKN Driveshafts India Ltd., Vs. ITO reported in 259 ITR 19 (SC) and proceed with the reassessment by affording opportunity to the writ petitioner. The said exercise is directed to be done as expeditiously as possible.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
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