Case Law Details
Mobis India Limited Vs DCIT (Madras High Court)
Hon’ble Supreme Court way back in 1979, in Indian and Eastern News Paper Society, put the issue beyond any pale of doubt by holding that the opinion on law rendered by an audit party cannot be the basis for exercising the power of reassessment. Evaluation of law and its bearing on the assessment must be directly and solely done by the assessing officer. The audit party can furnish information which leads the assessing officer to realise the need for reassessment. In other words, the information / material provided by the audit or any external agency must give birth to the realisation on the part of the assessing officer of the need to exercise its power of reassessment. However, the information cannot be the realisation. If the distinction between the two is lost sight, there is a grave danger of powers of reassessment being usurped by external agency and abdication of its quasi judicial function/power by the assessing officer, both of which are impermissible and would prove fatal to the validity of any proceedings which suffers from the above vice.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
These two writ appeals are filed by the appellant / assessee aggrieved by the order of the Learned Single Judge dismissing the writ petitions, on the ground of existence of alternate remedy. The writ petitions were filed against the orders of assessment relating to the assessment years 2008-09 and 2009-10, challenging the assumption of jurisdiction to reassess under Section 147 read with Section 148 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).
2. Brief facts: –
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