S. 147: Even s. 143(1) Intimation cannot be reopened in the absence of new information

Mohan Gupta (HUF) vs. CIT (Delhi High Court)

The reassessment is not on the basis of new information or facts that have come to the fore now, but rather, a re-appreciation or review of the facts that were provided along with the original return filed by the assesse. The record does not show any tangible material that created the reason to believe that income had escaped. Rather, the reassessment proceedings amount to a review or change of opinion carried out in the earlier A.Y. 2005-06, which amounts to an abuse of power and is impermissible. In response, it is argued that since the return was processed under Section 143(1) for the A.Y. 2005-06, which involves a mere intimation, rather than an application of mind or true assessment of the return, a less stringent threshold must be taken in terms of ‘reasons to believe’ that income has escaped assessment or not. This precise argument, however, has been considered and rejected by this Court in CIT v. Orient Craft[2013] 354 ITR 536 (Delhi)