25 Sections 147 and 148 – Reassessment Notice after four years – Failure by assessee to disclose material facts necessary for assessment – No evidence of such failure – Notice not valid

25. Reassessment
– Sections 147 and 148  – A. Y. 2004-05 –
Notice after four years – Failure by assessee to disclose material facts
necessary for assessment – No evidence of such failure – Notice not valid 

Anupam
Rasayan India Ltd. vs. ITO; 397 ITR 406 (Guj):

For the A.Y. 2004-05, the
assessment of the assessee company was completed u/s. 143(3) of the Act,
wherein the total income was computed at Nil and the company was allowed to
carry forward the unabsorbed depreciation of Rs. 3.81 lakh. Thereafter the
Assessing Officer issued a notice u/s. 148 dated 28/09/2009 seeking to reassess
the assessee’s income for the A. Y. 2004-05. The assessee filed writ petition
challenging the validity of the notice.

The Gujarat High Court
allowed the writ petition and held as under:

i)   While
citing five different reasons for exercising the power of reassessment, the
Assessing Officer in each case had started with the preamble “on going through
the office record it is seen that …” or something similar to that effect. In
essence therefore, all the grounds of reopening emerged from the materials on
record.

ii)   In
the background of the documents on record and the scrutiny previously
undertaken by the Assessing Officer it was clear that there was no failure by the
assessee to disclose material facts necessary for assessment. The notice for
reassessment was not valid.”