The Madras High Court, on appeal filed by the Commissioner of Income Tax, Coimbatore held that the re-opening of assessment u/s 147 of the Income Tax Act, 1961 against M/s.PRICOL Ltd., Coimbatore was bad as there was no proof that the assessee failed to make full and true disclosure of their income. The Court expressed a view that for reopening the assessment beyond the period of four years, but within seven years, the Department should show that there was a failure to disclose true and full information.
While delivering the judgment, V. Ramasubramanian.J added that, “none of the three Authorities have recorded any finding that there was a failure on the part of the assessee to make a true and full disclosure. Once this finding of fact is clear, the reopening of assessment was incorrect. Hence, the order of the Tribunal is correct.”
Read the full text of the Judgment below.
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