Law: Income Tax Act, 1961

Section: 147,148

Section 147, read with section 148, of the Income-tax Act, 1961 - Income escaping assessment - Non-disclosure of primary facts (Survey, effect of) - Assessment year 2010-11 - Assessee's return of income for relevant assessment year was processed under section 143(1) and income returned was accepted - In meanwhile a survey was carried out at business premises of assessee and on basis of survey report, a notice under section 148 was issued - Whether since neither survey report nor any other material indicated that any income chargeable to tax for relevant assessment year had escaped assessment, reassessment notice was liable to be quashed - Held, yes [Paras 13 and 14] [In favour of assessee] FACTS â–  The assessee-firms was a commission agent of the Onion Potato Market under Agricultural Produce Market Committee. â–  Its return of income for assessment year 2010-11 was processed under section 143(1) and profit claimed therein was accepted. â–  In the meanwhile, a survey action under section 133A was carried out at the business premises of the assessee and on the basis of survey report, a notice under section 148 was issued. â–  On writ, the assessee contended that survey report did not contain any reference of any transactions for assessment year 2010-11 and, therefore, could not be basis for reopening assessment. HELD â–  The pre-condition for issuing the notice under section 148 is the satisfaction in terms of section 147 that an income chargeable to tax has escaped assessment in the relevant assessment year. â–  In the instant case, neither the survey report nor any other material indicates that any income chargeable to tax for the relevant assessment year has escaped assessment. The Assessing Officer, therefore, had nothing before him which would enable him to record his belief that any such escapement has taken place. In the circumstances, the reasons recorded which pertain to all the assessment years prior and subsequent to the survey can hardly satisfy requirement of law. This is not how the power under section 147 should be exercised. That is to be exercised in exceptional cases. It should not be exercised as a manner of…

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