|B. C. Meena (AM), G. C. Gupta (VP)
|March 11, 2015 (Date of pronouncement)
|March 27, 2015 (Date of publication)
|Click here to download the file in pdf format
|S. 147/ 148: If the assessee does not ask for reasons and file objections before the AO, he is not entitled to challenge the reopening proceedings
(i) Law does not provide or mandate that the Assessing Officer shall suo motu shall supply the copy of those ‘reasons to believe’ to the assessee. It is for assessee and if assessee chooses to ask for reasons then he/she can file objection thereto. Only when such objections are filed, it becomes the duty of the Assessing Officer to dispose of all those objections first by passing a speaking order and if the objections are rejected then it gives a cause to the assessee to challenge such order by filing an appropriate writ. This is the law laid down by Hon’ble Supreme Court in GKN Drive Shafts (India) Ltd. vs. ITO – 259 ITR 19. cited supra. In the instant case, the assessee did not ask for reasons to believe. The assessee participated in the reassessment proceedings. The reassessment order was passed. The assessee felt aggrieved to such order and filed the appeal before the CIT (A). The CIT (A) has passed an appropriate order on this issue. Thus, we hold that the assessment was reopened by issuing a legal and valid notice u/s 148 of the Act. On the procedural aspect also, there is no infirmity in the notice. The notices u/s 143(2) and 143(1) were also properly served on the representative of the assessee.
(ii) Hon’ble Delhi High Court in the case of A.G. Holdings Pvt. Ltd. vs. ITO reported in 352 ITR 364 has held that there is no requirement in section 147 of the Act or section 148 or section 149 that the reasons recorded for reopening an assessment should also accompany the notice of reassessment issued u/s 148. The requirement in section 149(1) is only that the notice u/s 148 shall be issued. There is no requirement that it should also be served on the assessee before the period of limitation. There is also no requirement in section 148(2) that the reasons recorded shall be served along with the notice of reopening the assessment. The requirement, which is mandatory, is only that before issuing the notice to reopen the assessment, the Assessing Officer shall record his reasons for doing so. Thus, the Assessing Officer is duty bound to supply the reasons recorded for reopening the assessment to the assessee, after the assessee files the return in response to the notice issued u/s 148 and on his making a request to the Assessing Officer to that effect. In the case under consideration, even the assessee has not made any request for supply of the reasons. (CIT vs. Safetag International India (P.) Ltd. reported in 332 ITR 622 (Del) followed)