Law:

Section:

Section 147, read with section 148, of the Income-tax Act, 1961 - Income escaping assessment - Non-disclosure of primary facts - Assessment year 1992-93 - Assessee was engaged in proprietary business of cotton ginning - Assessing Officer issued notice under section 148 for reopening his assessment for relevant assessment year on ground that in his original return of income, assessee had claimed loss of stock on account of fire, but he did not show amount of insurance claim accepted by insurance company and, thus, income to that extent had escaped assessment - Facts revealed that along with return of income, assessee had placed a note pointing out factum of fire, factum of his having made claim before insurance company, and fact that claim had not been settled till point of time of filing of return - Assessee had also categorically stated in said note that when claim would be settled and received, same would be offered as income of year of receipt - Whether, on facts, it could be said that there was any omission or failure on part of assessee to fully and truly disclose all material facts relevant for assessment - Held, no FACTS The assessee was running a cotton ginning and pressing factory. For the relevant assessment year, the Assessing Officer completed his assessment under section 143(3). Subsequently, on 17-3-1999, the Assessing Officer issued a notice under section 148 for reopening the said assessment on the ground that in the original return of income, the assessee had claimed loss of stock on account of fire, but he did not show the amount of insurance claim accepted by the insurance company and, thus, the income to that extent had escaped assessment. The assessee challenged the said notice contending that along with the return of income, he had placed a note mentioning therein that the claim made by him with the insurance company had not been accepted by the insurance company till the point of time of filing of return; and that as soon as the claim would be settled and received, same would be offered as income of the year of receipt. The assessee, therefore, contended that in absence of his failure to disclose fully and truly all material facts…

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