The AO has issued notice
u/s.147, in response to which, the assessee informed by way of letter that the
return already filed may be treated as return in response to notice u/s.148. He
also requested for providing the reasons for reopening of the assessment.
However, the reasons for reopening of assessment were not supplied to the
assessee. During continuation of assessment proceedings, again the assessee
pointed out that the reason recorded for reopening of assessment has not been
intimated to him which may be provided at the earliest. However, the AO, without
supplying the copy of the reasons recorded, completed the assessment
u/s.143(3)/147 of the Income-tax Act. In response to which, the assessee filed
the appeal before the learned CIT(A), in which ground was taken against the
validity of reopening of assessment u/s.147. However, the learned CIT(A) upheld
the validity of reopening of assessment. Against which, the assessee filed the
appeal before the Tribunal.
The learned Judicial Member,
following the decision of Apex Court in the case of GKN Driveshafts (India) Ltd.
v. ITO, set aside the matter and restored the same back to the file of the AO
with a direction to follow the procedure as laid down by the Apex Court.
However, the learned Accountant Member differed with the learned Judicial Member
as he was of the opinion that on the facts of the assessee’s case, the decision
of the Apex Court was not applicable for the following reasons :
(i) In the case of GKN
Driveshafts (India) Ltd., the assessee did not furnish a return of income,
while in the case of the assessee, not only the return of income is furnished,
but also the assessment was completed.
(ii) Before the CIT(A),
the assessee did not take the ground that the assessment was wrongly made as
the AO did not supply the reasons recorded for reopening the assessment.
(iii) In the case of GKN
Driveshafts (India) Ltd., the notices u/s.148 and u/s.143(2) were challenged
in a writ.
Upon such difference of
opinion between the Members, the matter was referred to the Third Member.
Held :
The Apex Court has laid down
a general procedure which is to be followed by the assessee as well as the AO in
each and every case wherever notice u/s.148 is issued. The view of the learned
Accountant Member as well as the Departmental Representative that the above
decision of the Apex Court would be applicable only when the assessee files the
writ petition challenging the notice u/s.148, before the High Court or Supreme
Court is not acceptable.
As per the procedure laid
down by the Apex Court, filing of return by the assessee is a necessary
condition for getting the copy of reasons recorded. Therefore, the argument that
since the assessee has filed the return of income, the above decision of the
Apex Court would not be applicable, is not acceptable.
The assessee has challenged the reopening of
assessment u/s.147 before CIT(A). Once the assessee challenges the validity of
reopening an assessment, he may advance several arguments to support his
contention that assessment is not validly reopened. Non-supplying of the reasons
recorded is one of such arguments.
