No reassessment beyond 4 years as assessee disclosed Agricultural Land sale in return during scrutiny assessment

S.Uttam Chand Vs ACIT (Madras High Court)

Conclusion: Reassessment initiated beyond 4 years was quashed as assessee had disclosed the information with regard to the sale of the agricultural land and all the particulars with regard to sale of agricultural land was disclosed before AO in full extent and there was no failure on the part of assessee with regard to providing material facts and the notice issued under Section 148 and 149 of the Act for re-opening assessment.

Held: In the instant case, the present notice issued under Section 147 was beyond the period of four years stipulated in the Act since the impugned notice was issued on 30.03.2021 whereas the issue pertained to the Assessment Year 2013­-2014. In terms of proviso to Section 147, the limitation period was four years. Within four years, AO was supposed to re-open the assessment otherwise, in terms of the first proviso to Section 147, AO was supposed to empower to re-open, in the event if there was any failure on the part of assessee to disclose the income. It was held that assessee had disclosed the information with regard to the sale of the agricultural land and all the particulars with regard to sale of agricultural land was disclosed before AO in full extent. Further, a perusal of the materials placed before this Court would suffice to arrive at a conclusion that there was no failure on the part of assessee with regard to providing material facts and the notice issued under Section 148 and 149 of the Act for re-opening assessment for the Assessment Year 2013-14 was not sustainable and the same was liable to be set aside.

FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

This writ petition is filed challenging the reopening notice bearing Notice No.ITBA/AST/S/148/2020-21/1031938536(1) dated 30.03.2021, issued by the 1^st respondent herein, as well as the consequential order bearing DIN ITBA/AST/F/17/2021-22/1040500420(1) dated 09.03.2022 issued by the 2^nd respondent rejecting the petitioner’s objections for reopening.

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