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February 2012

Reassessment: Sections 147 and 148, 1961: In spite of repeated request reasons for reopening not furnished to assessee before completion of assessment: Reassessment not valid.

By K. B. Bhujle, Advocate
Reading Time 1 mins
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[CIT v. Videsh Sanchar Nigam Ltd., 340 ITR 66 (Bom.)]

In this case the assessment was reopened u/s.147. The assessee had requested for the reasons recorded, but the same were not furnished till the passing of the reassessment order. Following the judgment in the case of CIT v. Fomento Resorts and Hotels Ltd., (Bom.); ITA No. 71 of 2006, dated 27-11- 2006, the Tribunal held that though the reopening of the assessment is within three years from the end of the relevant assessment year, since the reasons recorded for reopening the assessment were not furnished to the assessee till the completion of the assessment, the reassessment order cannot be upheld.

The Bombay High Court dismissed the appeal filed by the Revenue and observed that the special leave petition filed by the Revenue against the decision of the Bombay High Court in the case of Fomento Resorts and Hotels Ltd. has been dismissed by the Apex Court.

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