Law:

Section:

Section 147, read with sections 143 and 148, of the Income-tax Act, 1961 - Income escaping assessment - Illustrations - Assessment years 1986-87 to 1989-90 - Whether where an agreement had not been placed on record nor considered to see whether lease amount received on account of transfer of plant and machinery by assessee should be treated as income from business, Assessing Officer was justified in reopening of assessment - Held, yes FACTS The assessments for the assessment years were completed under section 143(1) and thereafter notice was issued under section 148. During the course of the reassessment proceedings, the Assessing Officer had in-quired whether after transfer of the plant and machinery, the lease amount received on account of transfer by the assessee could be treated as business income. On considering reply, the Assessing Officer denied the assessee's claim and expenditure claimed on the basis of business income was also disallowed. The Commissioner (Appeals) allowed 25 per cent of the total expenditure claimed as expenditure incurred for the purpose of earning income. The Tribunal, however, remitted the matter to the Assessing Officer to examine the lease agreement and also to examine the balance sheet and then find out whether on transfer the receipt on account of the lease amount could be assessed and taxed as income from business or income from other sources. On appeal, the assessee contended that there was no information with the Assessing Officer to reopen the assessment within the meaning of section 147(b), read with section 148, and as such reopening was bad. HELD In view of the decision of the instant High Court in Chandi Ram v. ITO [1997] 225 ITR 611/[1996] 87 Taxman 418 (Raj.) wherein it was held that if limitation period has not expired, the amended provisions of section 147 will be applicable, there was no force in the submission of the assessee that reopening was bad when income had escaped and the agreement which went to the root of the issue had not been placed on record nor considered to see whether in that case lease amount received should be treated as income from business. In the absence of that if income escaped, the ITO was…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492