AI Structured Summary
Not yet generated for this judgment
Judgment
J.B. Pardiwala, J
This Tax Appeal under Section 260-A of the Income Tax Act, 1961 [for short, "the Act, 1961"] is at the instance of the Revenue and is directed against the order passed by the Income Tax Appellate Tribunal, Surat Bench, Surat dated 28th September 2018 in the I.T.A. No. 1006/AHD/2015/SRT for the assessment year 2006-07.
The Revenue has proposed the following question of law for the consideration of this Court:
"Whether, on the facts and circumstances of the case and in law, the Income Tax Appellate Tribunal is right in quashing the proceedings u/s. 148 of the I.T Act?"
The Appellate Tribunal, in paras 6, 7, and 8 of its impugned order, has observed as under:
"6. We have heard the rival submissions and perused the material on record; we find that it is not in dispute that the assessment has been reopened after expiry of four years from the end of relevant assessment year. It is seen that the assessment was completed u/s.143(3) and the re-opening of assessment has been made on the basis of material available on record and there is no indication in the reasons recorded for re-opening that there was new information came into possession subsequently. The perusal of the reasons recorded for re-opening shows that the AO has not mentioned that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. Even the assessment order also makes no mention of such failure on the part of the assessment. It is also noticed that assessee has filed objection vide letter dated 21.01.2013, but these objection has not been disposed by AO at all except making mention thereon in the assessment order. The AO was required to dispose off objection, laid down by Hon'ble Supreme Court in the case of G.K.N. Drive Shafts Ltd. and Gujarat High Court in case of 259 ITR 19 and Hon'ble Gujarat High court in the case of Garden Finance Ltd. 268 ITR 48 (SC). The AO is bound to dispose off objection filed by the assessee. We further find that the AO has not alleged that there was a failure on the part of assessee when the information was already available on record. Therefore, by applying ratio laid down by Hon'ble Gujarat High Court in the case of Sadbhav Engineering Ltd. v. DCIT (2011) 33 ITR 483 in which it was laid down that in absence of any averment that the assessments are sought to be re-opened by reason of failure on the part of assessee to disclose fully and truly all material facts necessary for assessment for the relevant assessment year, the very initiation of proceedings u/s.l47 by issuance of notice u/s.148 after expiry of four years from the end of relevant assessment year is bad and cannot be sustained.
In the light of above facts, we are of the considered opinion that the re-opening amounts to change of opinion and there was no failure on the part of assessee to disclose all necessary for making assessment, hence, the same is bad in law, and therefore quashed. Accordingly, this legal ground of the assessee is allowed.
Since we have quashed the re-assessment proceedings on the legal ground in the earlier part of this order, therefore, the other grounds relating to disallowance of partners remuneration of Rs. 6,63,371/is not being adjudicated as same have become infructuous."
The Appellate Tribunal, as a last fact finding authority, has taken the view that the reopening is nothing, but change of opinion and there was no failure on the part of the assessee in disclosing all the necessary information for the purpose of making assessment. We take notice of the fact that the Tribunal has relied upon a decision of this Court in the case of Sadbhav Engineering Ltd v. DCIT [(2011) 33 ITR 483].
In the overall view of the matter, we are convinced that no error, not to speak of any error of law could be said to have been committed in passing the impugned order.
In the result, this appeal fails and is hereby dismissed.