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Judgment
S.P. Bharucha, J.—By an order of this court dt. 7-2-1979. Hanuman Cotton Seeds Product Private Ltd. (hereinafter referred to as the said company) was amalgamated with the petitioners. In respect of the asst. yr. 1975-76 the assessment of the said company was completed on 19-6-1976. It is the case of the petitioners that they were told orally by the ITO concerned that audit objections had been raised to several points in the said assessment and clarifications were sought. The clarifications were supplied on 29-8-1979. On 12-3-1980 a notice was issued u/s. 148 of the IT Act seeking to reopen the assessment. The petitioners asked for the reasons why the assessment was proposed to be reopened. By a letter dt. 24-4-1980 the reasons were declined. On 2-7-1980 this petition was filed impugning the notice u/s. 148, particularly on the ground that audit objections did not constitute a good ground for the reopening of the assessment u/s. 147.
The affidavit in reply filed on behalf of the department states that after the assessment order dt. 19-6-1976 was passed a Full Bench of the IT Appellate Tribunal, Bombay, considered the implications of s. 35B of the Act in the case of M/s. J. Hemchand and, on the basis of that decision it was seen that the said company was not entitled to export development allowance u/s. 35B on certain stated items. It is contended in the affidavit, and this is fairly not disputed by Mr. Khatri, ld. Counsel for the petitioners, that the decision of the Tribunal in the case of M/s. J. Hemchand constituted information in the possession of the ITO and furnished a ground u/s. 147 for reopening the assessment.
What is contended by Mr. Khatri is that the petitioner had orally been told that audit objections had been raised and, in his submission, this was the real cause for the reopening of the assessment. It is not a submission which I can accept in view of the statement in the affidavit in reply backed by the reasons for the reopening contemporaneously recorded by the ITO.
In the result, the petition fails and is dismissed with no order as to costs. Rule discharged.