Loading judgment…
Facts
A search assessment for AY 2009-10 was completed under Section 153A. Subsequently, a notice under Section 148 was issued on 31/03/2016 to reopen the assessment, alleging the introduction of unaccounted money as bogus share capital/unsecured loans. The assessee challenged the validity of this reopening.
Held
The Tribunal held that the reopening was bad in law as it was initiated beyond the four-year period from the end of the relevant assessment year, and the Assessing Officer failed to record any non-disclosure of material facts by the assessee, as mandated by the proviso to Section 147 of the Act. Consequently, the reopening and the assessment order were quashed.
Key Issues
Whether the reopening of assessment under Section 148 for AY 2009-10 was valid, given it was beyond four years and the Assessing Officer did not record the assessee's failure to disclose material facts as per the proviso to Section 147.
Sections Cited
Section 153A, Section 148, Section 139, Section 140, Section 147
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI
Before: SHRI GEORGE MATHAN & SHRI RATNESH NANDAN SAHAY
Assessee represented by Sri Devesh Poddar, A.R. Department represented by Shri Khub Chand Pandya, Sr. DR Date of hearing 20/08/2025 Date of pronouncement 20/08/2025 O R D E R PER: BENCH 1. This is an appeal filed by the assessee against the order of the learned CIT(A), Patna-3, Patna in Appeal No. CIT(A), Patna-3/10495/2016-17 dated 19/03/2024 for the A.Y. 2009-10.
Shri Devesh Poddar, ld. A.R. is represented on behalf of the assessee and Shri Khub Chand Pandya, ld. Sr.DR is represented on behalf of the revenue.
It was submitted by the ld. AR that there was a search on the assessee on 16/09/2009. Consequent to the search, the assessment came to be completed under Section 153A on 29/12/2011. It was a submission that subsequently, on 31/03/2016, notice under Section 148 had been issued on the assessee and the assessment came to be completed on 29/12/2016. The ld. AR drew our attention to page No. 3 of the paper book wherein the reasons for the reopening has been shown which reads as follows:
Mongia Steel Ltd. Vs ACIT It was a submission that the impugned assessment year as 2009-10 and the Assessing Officer in a reasons recorded for reopening has not mentioned the failure on the part of the assessee to disclose fully and truly all material facts required for its assessment. It was a submission that the impugned assessment year is 2009-10, the first assessment has been completed on 29/12/2011 and the reopening has been done on 31/03/2016 which is beyond the four years period and for the purpose of reopening the proviso to Section 147 requires that there should be a failure on the part of the assessee to disclose fully and truly all material facts relevant to his assessment. It was a submission that there is failure on the part of the Assessing Officer to record the failure on the part of the assessee in the reasons recorded. It was a submission that the reopening is liable to be quashed.
In reply, the ld. Sr.DR vehemently supported the orders of the Assessing Officer and the ld. CIT(A).
We have considered the rival submissions. A perusal of the facts in the present case clearly shows that the reopening has been done beyond the four years period from the end of the relevant assessment year. The earlier assessment has also been done for the impugned assessment year. The reopening is done by issuing notice in such a case. In view of the proviso to Section 147 of the Act, it is required that there should be failure on the part of the assessee to disclose fully and truly all material facts required for his assessment. The Assessing Officer admittedly has not recorded such failure. This being so, we are of the view that the reopening as done for the impugned assessment year is bad in law