Reassessment Notices & Important observations of Bombay HC for reopening of cases U/S 148

Hon. Bombay  HC  in the case of Coca-Cola India Private Limited (WP No 1779 of 2006) made the following observations:

1. Failure by the AO to disclose that there was a failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment of that year would render the notice issued under Section 148 being held as without jurisdiction.

 2. If from the reasons, no case of failure to disclose is made out, then certainly the assumption of jurisdiction under Sections 147 and 148 of the Act would be ultra vires, being in excess of the jurisdictional restraints imposed by the first proviso to Section 147.

 3. The AO must disclose in the reasons as to which fact or material was not disclosed by the assessee fully and truly necessary for assessment of that assessment year, so as to establish vital link between the reasons and evidence.

 4. Reasons are the manifestation of the mind of the Assessing Officer. The reasons recorded should be self- explanatory and should not keep the assessee guessing for the reasons. Reasons provide a link between conclusion and evidence. The reasons recorded must be based on evidence.

 5. The reasons recorded by the Assessing Officer cannot be supplemented by filing an affidavit or making oral submission.