No failure on assessee’s part to disclose fully and truly all material facts during original assessment – Whether Reassessment proeeding justified?
Short Overview There was a definite reason to believe that to the tune of excess deduction income chargeable to tax had escaped assessment. When it was categorically stated that on account of certain information provided by assessee, a wrong assessment was made and excess deduction was made, so as to cause loss to the revenue, then it was to be construed that assessee had not disclosed fully and truly all material facts and in the event of non-reopening of assessment, interest of the revenue would be prejudiced. Therefore, reopening was sustained as valid.
Assessee was found to have claimed excess deduction, i.e., deduction at higher rate under section 80-IA. Accordingly, AO sought to reopen assessment after expiry of four years from the end of relevant assessment year. Assessee challenged this by way of writ petition contending that there was no failure on assessee’s part to disclose fully and truly all material facts during original assessment.
It is held that There was a definite reason to believe that to the tune of excess deduction income chargeable to tax had escaped assessment. When it was categorically stated that on account of certain information provided by assessee, a wrong assessment was made and excess deduction was made, so as to cause loss to the revenue, then it was to be construed that assessee had not disclosed fully and truly all material facts and in the event of non-reopening of assessment, interest of the revenue would be prejudiced. Therefore, reopening was sustained as valid and writ petition filed by assessee was dismissed.
Decision: Against the assessee.
IN THE MADRAS HIGH COURT
S.M. SUBRAMANIAM, J.
Aircel Cellular Ltd. v. Dy. CIT
W.P. No. 9241 of 2014 and W.P. Nos. 6858 & 6879 of 2015 and M.P. Nos. 1 & 3 of 2014 & M.P. Nos. 2, 2 & 3, 3 of 2015
27 April, 2021
Petitioner by: Vishnumohan For R. Parthasarathy (in all W.Ps)
Respondents by: Prabhumukunth Arunkumar Standing counsel (For Income Tax)
COMMON ORDER