|COURT:||Delhi High Court|
|CORAM:||Badar Durrez Ahmed J, Siddharth Mridul J|
|CATCH WORDS:||allegation, failure to disclose material facts, Reopening|
|DATE:||October 17, 2014 (Date of pronouncement)|
|DATE:||October 24, 2014 (Date of publication)|
|FILE:||Click here to download the file in pdf format|
|S. 147: The reasons must specifically indicate as to which material fact was not disclosed by the petitioner in the course of its original assessment|
In the reasons supplied to the petitioner, there is no whisper, what to speak of any allegation, that the petitioner had failed to disclose fully and truly all material facts necessary for assessment and that because of this failure there has been an escapement of income chargeable to tax. Merely having a reason to believe that income had escaped assessment, is not sufficient to reopen assessments beyond the four year period indicated above. The escapement of income from assessment must also be occasioned by the failure on the part of the assessee to disclose material facts, fully and truly. This is a necessary condition for overcoming the bar set up by the proviso to section 147. If this condition is not satisfied, the bar would operate and no action under section 147 could be taken. We have already mentioned above that the reasons supplied to the petitioner does not contain any such allegation. Consequently, one of the conditions precedent for removing the bar against taking action after the said four year period remains unfulfilled.
Any bad in law act by AO like jurisdiction if expired on the date of his notice u/s 147 or sec 143, is valid ground to invalidate AO’s Notices and if AO has issues such Notices on his own can withdraw such Notices as notices cancelled would be a prudent act of AO.
If he fails and causes unnecessary litigation the judicial authorities like CIT(A) on can admonish the AOs concerned;
If CIT(A) gives a bad in law order He need be demoted to next lower rank if he did at ;east such 3 bad orders and if it is the first time he may be warned;
If there are appeals at ITAT on such kind of bad in law Notices are questioned the hon ITAT on its own motion without any hearings can cancel such bad n law Notices and direct the AO issue cancellation and withdrawal of such bad in law notices, that would save the AO by simple admonition by ITAT;
if the AO fails, ITAT may levy penalties on AO as also his zonal commissioners for encouraging such activities;
If ITAT again at hearing of appeals by assessee can award damages equal to the amount AO levied on assessee without jurisdiction, under bad in law jurisdiction AO exercised by him on the assessee;
if the matter goes to hon HC such bad in law jurisdiction, hon HC can levy exemplary penalties on the AO as also zonal commissioners and these penalties need be paid forthwith under vicarious liability on Revenue.
thus law and order can be rejuvenated in the department of Revenue by the judicial authorities, i believe !