Law:

Section:

Section 147, read with section 148, of the Income-tax Act, 1961 - Income escaping assessment - Non-disclosure of primary facts - Assessment year 1995-96 - Whether in order to assume jurisdiction under section 147 in a case where assessment has been made under section 143(3), following conditions are required to be satisfied: (i) Assessing Officer must have reason to believe that income chargeable to tax has escaped assessment, and (ii) he must also have reason to believe that such escapement occurred by reason of failure on part of assessee either (a) to make a return of income under section 139 or in response to notice issued under section 142(1) or section 148; or (b) to disclose fully and truly all material facts necessary for his assessment for that purpose - Held, yes - Whether in cases where assessment has been made under section 143(3) and action under section 147 is sought to be taken after expiry of four years from end of relevant assessment year, it is necessary that condition No. (i) and either of conditions No. (ii)(a) or (ii)(b) must co-exist - Held, yes FACTS The assessee, an advocate, claimed deduction under section 80-O at the rate of 50 per cent of the total professional income received from his foreign clients. The Assessing Officer passed the relevant assessment order under section 143(3) and allowed the deduction under section 80-O as claimed by the assessee. Subsequently, the Assessing Officer issued a notice under section 148 to the assessee after the expiry of four years from the end of the relevant assessment year and reopened his aforesaid assessment for the reason that the assessee had claimed deduc-tion under section 80-O on the gross foreign receipts; whereas it was available on the net foreign receipts and, thus, the assessee's income to some extent had escaped assessment for the relevant assessment year. In reassessment proceedings, the Assessing Officer overruled the objections raised by the assessee that in the absence of any allegation of failure on his part to disclose fully and truly all material facts necessary for assess-ment, no action under section 147 could be taken after the expiry of four years from the end of the…

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