ORDER :

The order passed by the respondent, rejecting the reasons furnished for reopening of assessment in proceedings dated 15.11.2016, is under challenge in the present writ petition.

2. The petitioner is an assessee engaged in the business of design, manufacture, supply, erection and installation of lifts and supply, erection and installation of escalators. It is engaged in manufacture and export of computer software which is a 100% export oriented unit duly approved vide proceedings dated 28.02.2002 under the Software Technology Park Scheme of the Government of India which was issued under the delegated power of the Directors of Software Technology Parks of India (STPI) by Inter Ministerial Standing Committee (IMSC) vide letter dated 24.06.1993.

3. There is no serious dispute in respect of the facts placed by the petitioner. The respondent-Department have also not disputed the nature of business as well as the order of approval issued by the Directors of STPI by IMSC vide letter dated 24.06.1993.

4. The issue raised is about the exemption to be granted under Section 10B of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).

5.The learned counsel for the petitioner made a submission that the mandatory requirement as contemplated by the Hon'ble Supreme Court of India in the case of GKN Driveshafts (India) Ltd. vs. Income-tax Officer reported in (2003) 259 ITR 19(SC) has not been complied with. The reasons furnished are gist and not reasoned. Thus, the very initiation of reassessment proceedings under Section 147 of the Act and the notice under Section 148 of the Act and the reasons furnished are in violation of the directives issued by the Hon'ble Supreme Court.

6. It is contended that the returns filed by the petitioner were taken up for scrutiny and the Assessing Officer considered all the documents and materials made available and passed the assessment order under Section 143(3) of the Act on 31.03.2013. In the said assessment order, the income exempted under Section 10B was deducted and the benefit was extended to the petitioner. The benefit was extended based on the approval obtained by the petitioner from the competent authority, mainly the STPI. The assessee was of an opinion that the approval granted by the STPI, pursuant to the delegation of powers conferred on them by the IMSC, is valid for the purpose of claiming exemption under Section 10B of the Act. Thus, the assessee had not committed any act of suppression or omission at the time of filing of returns or at the time of scrutiny. Admittedly, the reopening of assessment proceedings are initiated beyond the period of four years and within a period of six years. Undoubtedly, if the reassessment proceedings are initiated within a period of four years, then the scope is wider. If the reassessment proceedings are initiated beyond the period of four years, then the conditions stipulated in the provisions are to be satisfied.

7. The learned counsel for the petitioner reiterated that there was no suppression or otherwise and the assessee filed returns and furnished all the details and even the reopening proceedings were not clear regarding any alleged suppression or non-disclosure and therefore, the initiation beyond the period of four years, is hit by the conditions stipulated under Section 147 of the Act.

8. The learned Senior Standing Counsel appearing on behalf of the respondent disputed the said contention by stating that the reasons stated for reopening of assessment under Section 148 reveal that “the assessee claimed an amount of Rs.3,78,00,000/- as exemption under Section 10B of the Act in respect of the export of software based on the approval of STPI/MEPZ without ratification by the Central Board of Direct Taxes (CBDT) as per the Explanation 2(iv) under sub-Section 9A of the Act”. The assessee had suppressed the fact regarding the ratification to be obtained from the CBDT which is not obtained admittedly and thus, the reopening of assessment is well withi