Landmark Cases on Assessment Procedure

A non-obstante clause in a statutory provision, such as Section 144C(1) of the Income Tax Act, has overriding effect over other provisions in the Act, implying it prevails in case of conflict.

An appellate authority has the power to consider a larger amount in support of a claim if the materials for that claim are already on record, even if the assessee is revising the claim during assessment proceedings.

Courts can examine the circumstances surrounding the enactment of a law, including the Statement of Objects and Reasons, to understand the purpose or object of the legislation.

When no return is filed in response to a notice under section 148 of the Income Tax Act, a separate notice under section 143(2) is not required to make the assessment.

The Assessing Officer must record dissatisfaction regarding the correctness of the assessee's claim for expenditure to earn exempt income before invoking Rule 8D for disallowance under Section 14A of the Income Tax Act.

The Assessing Officer must comply with the directions of the Dispute Resolution Panel (DRP) when passing final assessment orders, and failure to do so may warrant setting aside the assessment with a direction for compliance.

When an assessment comes before an Appellate Assistant Commissioner (AAC), their jurisdiction extends to the entire assessment, not just the issues raised by the assessee. The AAC can correct errors made by the Income Tax Officer (ITO) even on matters not appealed by the assessee.

Reopening an assessment does not constitute a change of opinion if the original assessment order was silent on the specific issue that forms the basis for the reopening.

Section 139(5) regarding revision of returns is partly substantive and partly procedural, allowing for correction of omissions even in returns filed in response to a notice under Section 148.

An Assessing Officer must follow the binding directions of the Dispute Resolution Panel (DRP) under section 144C(13), and failure to do so renders the assessment order non-est (void ab initio).

The proposition of law for which this case is cited is not clearly ascertainable from the provided passages, as they only list it as a cited case without detailing the specific legal point decided. However, its prominent placement with sections 147, 148, and 132 suggests it relates to reassessment or search and seizure proceedings.

An assessment order is invalid if the Assessing Officer lacked pecuniary jurisdiction to frame it and failed to issue a notice under Section 143(2).

Where an assessee dies during original assessment proceedings and the AO is aware of this, a reassessment notice issued in the deceased assessee's name and PAN, rather than their legal representative's, is illegal. Consequently, all orders passed pursuant to such notice are void and must be quashed.

Reassessment orders are liable to be quashed if the approval for issuing notice under section 148 was not obtained from the specified authority under section 151(ii).

The issuance of a draft assessment order does not extend the time limit for completing the assessment. If no variations are proposed in the returned income, a draft assessment order is not required.

Additions to income made on a notional basis, based on an alleged foreign bank account that is under serious challenge, are liable to be deleted. This is especially true if prior year additions have already been deleted.

The Income Tax Appellate Tribunal (ITAT) in Mahadev Cold Storage v. Jurisdictional Assessing Officer held that the Assessing Officer (AO) has the jurisdiction to make an assessment or reassessment if an income chargeable to tax has escaped assessment. This decision also touched upon issues related to the Indian Evidence Act and assessment procedures under the Income Tax Act.

Section 153D of the Income Tax Act, 1961, inserted by the Finance Act 2007, is applicable to proceedings initiated after its effective date of 1st June 2007, irrespective of whether prior judgments directly referred to it.

The validity of initiating reassessment proceedings under Section 147 and 148 of the Income Tax Act must be independently evaluated and should not be confused with the powers available to the Assessing Officer once assessment has been validly reopened. Sections 148A(b) and 148A(d) have an integral connection.

Proceedings initiated for the benefit of revenue cannot be allowed for the benefit of the assessee. If an assessee can seek a benefit through an alternate remedy, they should explore that mechanism.

Any assessment or order passed in the name of a deceased person is void ab initio. The legal representatives of the deceased must be brought on record before any such proceedings are completed.

Where all relevant facts are on record, an assessee can make a claim for deduction or exemption for the first time before the Income Tax Appellate Tribunal.

A taxpayer's established position, once accepted and not challenged in a prior year, generally cannot be changed in a subsequent year if it has become a factual determination. Past practice is considered a reliable guide, especially for fair estimations in assessments.

Amendments to tax laws that are explanatory, declaratory, curative, or clarificatory in nature are judicially construed as retrospective. The Supreme Court has held that words indicating a deeming provision, such as 'shall be deemed never to have included', signify a declaratory amendment with retrospective effect.

Findings in earlier assessment years are not conclusive and facts can be reconsidered in later years, leading to different findings.

If an income tax exemption is granted for an assessment year based on certain conditions, the Assessing Officer cannot withdraw the exemption for subsequent assessment years without first withdrawing the exemption for the initial year.

Additions made by the Department on the ground of undisclosed income are erroneous when the assessee has made disclosures in their wealth tax return which were accepted by the Department.

The books of account do not necessarily have to be rejected before a reference is made to a Director of Investigation (DVO) under Section 142A of the Income Tax Act.

The adequacy or sufficiency of the Assessing Officer's reasons to believe that income has escaped assessment is not justiciable by the High Court.

An assessee must first file preliminary objections with the Assessing Officer regarding a reassessment notice. The Assessing Officer must decide these objections by passing a speaking order before the assessee can approach the High Court.

Courts cannot correct defects or omissions in legislation; they must interpret the law as written and declare the legislature's shortcomings so they may be remedied.

Decisions of the jurisdictional High Court have binding precedent on lower authorities, and deviations from such precedents are not permissible.

Where an assessee files a return in response to a notice under Section 148, the Assessing Officer must issue a notice under Section 143(2). Failure to do so renders the reassessment order under Section 147 a nullity and liable to be quashed.

Issuance of a notice under section 143(2) is mandatory, even in reassessment cases, and its absence renders the consequent assessment invalid. This requirement holds true even if the assessment follows a search under section 132.

The Appellate Assistant Commissioner's power of enhancement is limited to the income that was the subject matter of the assessment by the Income-tax Officer.

Provisions of the Special Court Act, where applicable, shall prevail over the provisions of the Income Tax Act, irrespective of any inconsistency.

The Supreme Court's power under Article 32 of the Constitution to issue directions, orders, or writs for the enforcement of fundamental rights is a significant remedy.

If a specific procedure is mandated by law for performing an action, that procedure must be strictly followed, and deviation renders the action invalid. Non-compliance with mandatory procedures overrides considerations of procedural irregularity, deemed acceptance, or lack of prejudice.

A High Court should generally not entertain a writ petition under Article 226 of the Constitution if an alternative statutory remedy is available, unless there are well-defined exceptions.

Failure to follow a mandatory procedural step is fatal to the assessment. This means the assessment will be quashed if the prescribed procedure is not followed.

The proviso to Section 113 of the Income Tax Act is retrospective in nature and should be read into the block assessment scheme. The Supreme Court viewed that no statute should be construed to have a retrospective operation unless clearly indicated or by necessary implication, noting that assessments create vested rights.

The reasons recorded for reopening an assessment must specifically state any failure by the assessee to disclose fully and truly all material facts necessary for the assessment. A deemed failure cannot be contended if the reasons are silent on this point, as it is a matter of fact.

The duty to disclose primary and material facts, as confined by Explanation 1 to the relevant section, is a pervasive principle across various provisions of the Income-tax Act.

Jurisdictional High Courts hold that the Supreme Court's decision in Goetz (India) Limited v. CIT, which limits the Assessing Officer's powers, does not impact the powers of Appellate Authorities.

Technical pleas based on mistakes, defects, or omissions in assessment proceedings should not invalidate them if no prejudice or confusion is caused to the assessee. Section 292B is intended to prevent such procedural flaws from vitiating assessments.

The project completion method of revenue recognition is justified for real estate developers and builders, instead of the percentage completion method, especially when consistently followed by the assessee.

An assessee must be allowed credit for income surrendered and disclosed in another year or by another group assessee to avoid impermissible double taxation.