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| DATE: | February 25, 2014 (Date of publication) |
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| Click here to download the judgement (mohan_143_1_147.pdf) |
S. 147: Even s. 143(1) Intimation cannot be reopened in the absence of new information
The reassessment is not on the basis of new information or facts that have come to the fore now, but rather, a re-appreciation or review of the facts that were provided along with the original return filed by the assesse. The record does not show any tangible material that created the reason to believe that income had escaped. Rather, the reassessment proceedings amount to a review or change of opinion carried out in the earlier A.Y. 2005-06, which amounts to an abuse of power and is impermissible. In response, it is argued that since the return was processed under Section 143(1) for the A.Y. 2005-06, which involves a mere intimation, rather than an application of mind or true assessment of the return, a less stringent threshold must be taken in terms of ‘reasons to believe’ that income has escaped assessment or not. This precise argument, however, has been considered and rejected by this Court in CIT v. Orient Craft [2013] 354 ITR 536 (Delhi)
Pl also report judgments of jharkhand High Court available in Indiakanoon and manupatra
On request my office can provide land mark judgments of Jharkhand Highcourt on tax matters such as Income Tax.Vat Service Tax Central Excice.Cess.Entry Tax Entertainment Tax
While judgement of hon’ble High Court is appreciated, will any tax experts advice as to how to bring the escaped income in the back ground gross misuse of summary acceptance of returns.
When the escapement of income is very much apparent from the record which was processed by computer(CPC), how to bring the tax evaders to book.
It appers that hon’ble court has not proerly appreciated the purpose of provisions of sec 147
The judgments of Courts in the cases of reopening are mostly based on the restraints already placed under sec.147 to 151, it appears. Even otherwise, when the Ministry introduces summary schemes, it has always done so with the conscious knowledge that some revenue may be eroded due to this. it may be remembered that Board issued a circular to this effect in 1973 so that repeated audit objections and consequential burden of remedial action could be thwarted. Such is the case even today in respect of CASS cases selected for the limited purpose.
Yet, in cases where the concealment is of higher order the search & survey provisions are available.
full bench Delhi High court is there 248 ITR Usha International. Read also A.Raman & CO relating to section 147(b) SC 67 ITR and also read in respect of section 34(1)(b) Kalyanji Mavji 102 ITR (SC) . Also see the language of section 147 w.e.f. 1.4.1989. Earlier the words were ‘in consequence of information has reasons to believe’ now these words are not there. There fore one view supported by the decisions and section is very clear. The language of the section appears to have not been noticed. Even the full bench judgement as well as SC courts decisions not brought on record .Kb
therefore, no fresh material is required for reasons to believe . It can be on the basis of the material on record/return filed.
. The explanation 2(b) of section 147 has also seems to have been ignored. This explanation was also added w.e.f 1.4.89. Earlier it was not there. section talks of assess or reassess. It is settled law in view of 291ITR 500(SC) that intimation is not an assessment. section also talks of escapement of assessment . Relying on this, therefore, in my view may not be proper. It appears the case has not been properly argued.
On the subject matter and issue there is a good judgment in the case of CIT vs Kamdhenu Steels & Alloys Ltd & Others. There were 8 appeals of the department considering the issue in relation to addition u/s 68 of the Act on account of unexplained share application money. In this case the hon’ble court considered the all previous judgments on the subject matter and issue and also re-opening on the ground of information from Investigation wing.