Law:

Section:

Section 147 of the Income-tax Act, 1961 - Income escaping assessment - Non-disclosure of primary facts - Assessment year 1966-67 - Assessee's agricultural land was acquired by State Government - Subsequently, Assessing Officer sought to reopen original assessment on ground that assessee failed to disclose that apart from agricultural land, non-agricultural assets had also been acquired by State Government which resulted in escapement of capital gains tax on transfer of non-agricultural assets - From records, it was, however, found that agreement entered into by and between assessee and State Government, which gave details of assets to be transferred by assessee, was before Assessing Officer at time of original assessment - Moreover, during original assessment, assessee, at instance of Assessing Officer, had also written two letters disclosing further particulars about assets taken over by State Government - Whether in view of circumstances, it could be concluded that assessee had disclosed fully and truly all material facts including facts relating to transfer of non-agricultural assets at time of original assessment - Held, yes - Whether, therefore, assessment could not be reopened under section 148, read with section 147(a) - Held, yes FACTS The assessee was a manufacturer and seller of sugar and was owning large agricultural lands with buildings appurtenant thereto. The surplus land held by the assessee was acquired by the State Government vide Notification issued under the provisions of the Maharashtra Agricultural Land (Ceiling on Holdings) Act, 1961. The assessee challenged the said acquisition and ultimately an agreement was arrived at between the assessee and the State Government by which the agricultural assets including lands were handed over to the Maharashtra State Farming Corpn. and the assessee received certain compensation under different awards made by the State Government in that behalf. For the relevant assessment year, the Assessing Officer issued a notice whereby the original assessment was sought to be reopened under section 148, read with section 147(a) on the ground that there was failure on the part of the assessee to disclose that apart…

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