Can A.O Reopen The Dropped Case Of Reassessment Proceeding?
The ITO started reassessment proceedings against me for the AY 2004-05, in May 2006 in a property related matter. After a few months the case was dropped by the ITO. I was informed only in February 2008. The ITO then started reassessment proceedings for the AY 2001-02 and passed an adverse order against me. I have gone in appeal. My question is can he once again restart the Reassessment proceedings against me for the AY 2004-05 once he has passed a written order saying that the case is dropped
Joe Rodricks , Mumbai
The power under section 147 read with section 148 are very wide. However , if a new facts come in A.O’s eyes and based on the new fact which was not before him when he drooped the proceeding u/s 147 , he is empowered to reopen the case. Read the decision of Supreme Court in Ess Ess Kay Engineering Co P Ltd vs CIT [2001] 247 ITR 818
This is a case of reopening. We have perused the documents. We find there was material on the basis of which the Income-tax Officer could proceed to reopen the case, it is not, a case of mere change of opinion. We are not inclined to interfere with the decision of the High Court merely because the case of the assessee was accepted as correct in the original assessment for this assessment year. It does not preclude the Income-tax Officer to reopen the assessment of an earlier year on the basis of his findings of fact made on the basis of fresh materials in the course of assessment of the next assessment year. The appeal is dismissed. No order as to costs.
However, if the same facts which are the basis of his “reason to believe” , in that case he can not reopen the case because in that case it becomes mere change of opinion.. If he does you may win the case in higher appellate. There are umpteen numbers of cases against revenue department wherein Higher Appellate authorities have deleted the orders of reassessment on the ground that the initiation was on account of “mere change of opinion” and not based on some new facts which was not before the A.O at the time of assessment.
Posts
