Commissioner of Income Tax vs Micro Inks Ltd.

Akil Kureshi, J.—Revenue is in appeal against the judgment of the Income Tax Appellate Tribunal ("the Tribunal" for short) dated 27.4.2012 raising following questions for our consideration:

(A) Whether on the facts and circumstances of the case and in law, the Tribunal was right in annulling the assessment made u/s 143(3) read with section 147 of the Act?

(B) Whether on the facts and circumstances of the case and in law, the Tribunal was correct in granting relief to the assessee without considering the facts brought in by the Assessing Officer and decisions relied in support of reopening of the assessment in its entirety?

Issue is identical in both the appeals and pertains to order passed by the Tribunal confirming the decision of CIT(Appeals). CIT(Appeals) had set aside the assessment framed by the Assessing Officer u/s 147 of the Act.

For the assessment year 2000-2001 and 2001-2002, the assessee had made various claims including for deduction u/s 80HHC and 80IA of the Act. Such returns were scrutinised and assessment orders were passed u/s 143(3) of the Act at the relevant time. Subsequently, the Assessing Officer issued notices u/s 148 of the Act on 6.3.2007 seeking to reopen the assessments for both the years on the ground that as per section 80IA(9) read with section 80IB(13) of the Act. Assessee opposed the proceedings on the ground that in absence of any failure on part of the assessee to disclose truly and fully all material facts, reopening would not be permissible beyond period of four years from the end of relevant assessment year. The Assessing Officer rejected the objection and proceeded to frame fresh assessment.

The Commissioner(Appeals) however, found that there was no failure on part of the assessee to disclose true and full facts. He in fact called for Assessing Officer''s remand report why reopening was resorted beyond a period of four years. From the appellate order, we gather that all the Assessing Officer had to offer by way of comment was that though the assessment was reopened beyond a period of four years, same was within six years.

Surely, this can hardly be a ground to support a notice for reopening beyond a period of four years. Particularly, in absence of any failure on part of the assessee to disclose truly and fully material facts, the CIT (Appeals) proceeded to quash the assessment years.

The Tribunal relying on decision in case of ACIT v. Bilag Industries Pvt. Ltd. in ITA No. 700-701/Ahd/2009, upheld CIT(Appeals) order.

Having heard learned counsel for the parties, we see absolutely no reason to interfere. CIT (Appeals) as well as the Tribunal concurrently held that there was no failure on part of the assessee to disclose true and full facts. Counsel for the Revenue could not bring any contrary material to our notice. We may add that Revenue''s appeal in case of Bilag Industries Pvt. Ltd. being Tax Appeals No. 27/2012 and 28/2012 came to be dismissed by us by a separate order passed today. In the result, these tax appeals are also dismissed.