DCIT, SALEM vs. GREEN FIELD SHELTERS PVT. LTD., SALEM

All the appeals of the Revenue are directed against the common order dated 18.08.2015, passed by the Commissioner of Income Tax (Appeals)-18, Chennai, for the assessment year 2007- 08, 2008-09 and 2009-10. The assessee has also filed cross- objections against the very same common order. Therefore, we of the same by this common order.

Sh. P. Radhakrishnan, the Ld. Departmental Representative, submitted that there was a search in the case of Shri A.S.

The Ld. Departmental Representative further submitted that in the assessment order, the Assessing Officer found that the assessee has received on-money of `26,00,000/- from the buyers for the assessment year 2008-09. By extending the same analogy for the assessment years 2008-09 and 2009-10, the Assessing Officer made addition in the reassessment proceedings. According to the Ld. D.R., since the material was found during the course of search operation, with regard to receipt of on-money, the Assessing money was not the subject matter of examination in the regular assessment, therefore, according to the Ld. D.R., it is not a case of change of opinion. However, the CIT(Appeals) found that the assumption of jurisdiction by reopening the assessment under Section 147 of the Act is illegal. Accordingly, he deleted the addition made by the Assessing Officer. According to the Ld. D.R., the proceeding initiated under Section 153C of the Act may not be correct since the brochure found during the course of search operation was construed as not an incriminating material. The Assessing Officer, during the examination under Section 132(4) of the Act, found that the assessee has received on-money on sale of plot which was supported by the brochure found at the residence of Shri A.S. Aadhinarayanan. Therefore, according to the Ld. D.R., this material is very much available during the course of search operation. Since the income chargeable to tax escaped assessment, the notice under Section 148 of the Act was issued within four years from the end of the relevant assessment year.

Referring to the cross-objections filed by the assessee, the Ld.counsel for the assessee submitted that the reopening of assessments without any fresh material on record would amount to change of opinion. The Ld.counsel further submitted that there is for completing the assessment. Therefore, according to the Ld. counsel, the issue of notice under Section 148 of the Act is not justified. The brochure seized at the premises of Shri A.S.

We have considered the rival submissions on either side and perused the relevant material available on record. On the basis of search conducted under Section 132 of the Act at the residential premises of Shri A.S. Aadhinarayanan, the Assessing Officer completed the assessment in the case of the assessee under Section 153C of the Act. On the basis of the brochure found during Section 153C of the Act, was challenged before the CIT(Appeals) who set aside the addition made by the Assessing Officer on the ground that the so-called brochure cannot be construed as incriminating material for the assessment year 2008-09. When the matter travelled to this Tribunal, this Tribunal confirmed the order of the CIT(Appeals) holding that there was no incriminating material for making addition for on-money for the assessment year 2008-09 in the block period under Section 153C of the Act. Now the Assessing Officer has reopened the assessment by issuing notice under Section 148 for all the assessment years. The notice was issued within four years from the end of the relevant assessment year. The proviso to Section 147 would be applicable only in case the assessment was completed under Section 143(3) of the Act. The prohibition contained in the proviso to Section 147 of the Act is for reopening assessment after expiry of four years from the end of relevant assessment year. In the case before us, assessments for all the three assessment years were reopened within a period of four years. Therefore, this Tribunal is of the considered opinion that the proviso to Section 147 of the Act may not stand in the way of reopening assessments. Admittedly, during the course of search recorded. The brochure found by the Revenue authorities was held to be not an incriminating material. Therefore, the addition made by the Assessing Officer was deleted by the CIT(Appeals) which was confirmed by this Tribunal. Based upon the order of this Tribunal for the block assessment proceeding, confirming the order of the CIT(Appeals), the CIT(Appeals) found that there is no foundation for reopening assessment for the assessment years under consideration.

We have carefully gone through the Sections 147 and 148 of the Act. Section 147 clearly says that if the Assessing Officer has reason to believe that any income chargeable to tax escaped assessment for any of the assessment year, subject to provisions of Sections 147 and 148 of the Act, can assess or re-assess such income which escaped assessment. In this case, there is some evidence to indicate that the assessee has received on-money for the assessment year 2008-09. The same set of plots were sold during other years also. Therefore, the Assessing Officer believed that the income chargeable to tax escaped assessment. We have carefully gone through the reasons recorded by the Assessing Officer for reopening the assessment which is available at page 41 reopening the assessment that one Shri A.B.S. Sanjay stated in his sworn statement that he paid an amount of `26,00,000/- as on- money to the assessee-company at the time of purchase of two plots at Yercaud in the assessment year 2008-09. A copy of the sworn statement recorded from Shri A.B.S. Sanjay has been filed by the Revenue which is available on record. The said Shri A.B.S.

In the result, both, the appeals of the Revenue and the cross-objections of the assessee are dismissed.