Law: Income Tax Act, 1961

Section: 143

(a) Income-tax----Assessment---Intimation to assessee under S.143(1)(a) after issue of notice under S.143(2)---Assessing Officer could issue fresh notice under S.143(2)--¬Indian Income Tax Act, 1961, S.143. (b) Wealth tax--- ---- Reassessment under Income Tax Act and Wealth Tax Act---Law Applicable to assessment---Effect of amendment of 5.147 of Income Tax Act w.e.f. 1-4-1989---Reason to believe that income had escaped assessment--¬Finding in assessment for another year that assessee was given a low rent for a property and as compensation had received certain benefits and perquisites---Reassessment proceedings were valid---Indian Income Tax Act, 1961, S.147---Indian Wealth Tax Act, 1957, S.17. An intimation to the assessee under section 143(1)(a)(i) of the Income Tax Act, 1961, even after issue of notice under section 143(2), does not oust the jurisdiction of the Assessing Officer to issue a fresh notice under section 143(2), where he considers it to be necessary or expedient to ensure that the assessee has declared his income correctly. Apogee International Ltd. v. Union of India (1996) 220 ITR 248 (Delhi) fol. Section 147 of the Income Tax Act, 1961, as amended with effect from April 1, 1989, provides that if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153 of the Act, assess or reassess such income and also any other income chargeable to tax which has escaped assessment. The section not only merges clauses (a) and (b) of the pre-amended section 147 but also brings about a significant change in the preliminary requirement of certain mandatory conditions before reassessment proceedings could be initiated under the old section. Under the unamended section 147(a), the Assessing Officer could initiate reassessment proceedings if he had reason to believe that income chargeable to tax had escaped assessment by reason of: (a) omission or failure on the part of an assessee to make a return under section 139 of the Act for any assessment year, or (b) to disclose fully and truly all material facts necessary for his assessment for that…

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