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B. M. SHYAM PRASAD
Jindal Naturecare Limited – Appellant
Versus
Assistant Commissioner Of Income Tax, Circle-4(1)(1) &ors. – Respondent
JUDGMENT
B.M. Shyam Prasad, J. - The common petitioner in WP Nos. 44636/2017 and 52268/2017 has impugned the notices issued under section 148 of the Income-tax Act [for short, 'I-T Act'] for the AY: 2013-14 and 2015-16 and the second respondent's corresponding order dated 10.08.2017. The second respondent, by these orders, has rejected the petitioner's objections contesting the reasons offered for reopening the assessment for the aforesaid assessment years. In addition, the petitioner has also challenged the notification dated 06.09.2016 issued by the Central Board of Direct Taxes, Department of Revenue, Ministry of Finance.
2. The Central Board of Direct Taxes by this notification dated 06.09.2016, which is issued in exercise of the power conferred under section 35(1)(ii) of the I-T Act read with rule 5C and 5C of the Income Tax Rules 1968, has rescinded the earlier notification dated 14.03.2018 in No. 35/2008 with effect from 01.04.2007 with the stipulation that this notification dated 14.03.2008 shall not be deemed to have been issued for any tax benefits under the I-T Act or any other law for the time being in force. The petitioner in WP No. 52269 of 2017 is also similarly placed
The threshold bar for initiation of reassessment proceedings must be satisfied based on relevant material for forming the belief that income has escaped assessment, as per settled propositions relate....
Assessee’s objections raised against the reopening proceedings are not acceptable as the case warrants scrutiny on the same lines. Accordingly, the objections so raised are hereby disposed off accord....
Reopening of assessment under the Income Tax Act requires fresh tangible material; mere change of opinion is insufficient for valid reassessment.
Reassessment under Section 147 after four years requires proof of failure to disclose material facts, which was not demonstrated in this case.
Under section 147 of the Act the proceedings for the reassessment can be initiated only if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any....
Point of Law : Sufficiency of the evidence or material is not open to scrutiny by the Court but the existence of the belief is the sine qua non for a valid exercise of power.
The Assessing Officer must have tangible evidence linking the taxpayer to alleged income escape for valid reassessment under the Income Tax Act; mere suspicion is insufficient.
Point of Law : Court satisfied that there was prima facie material available on record before the assessing officer for issuing a notice for reassessment and the notice under Section 148.
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