Assumption of Jurisdiction by Assessing Authority beyond period of 4 years is not barred by Limitation in the absence of Full and True Disclosure u/s 147: Madras HC [Read Order]

Assumption of jurisdiction by the assessing authority beyond the period of 4 years is not barred by limitation in the absence of full and true disclosure under section 147 of the Income Tax Act,1961, the Madurai bench of the Madras High Court has held as above.

M/s.RKR. Gold P. Ltd, the petitioner challenged proceedings for re-assessment under the provisions of the Income Tax Act, 1961 (Act) for the assessment year A.Y.20112012. The petitioner had filed the return of income, in time, accompanied by the required annexures. The return was taken up for scrutiny and notice under Section 143(2) was issued on 31.07.2012.

A notice had been issued by the Income Tax Officer in the Intelligence and Criminal Investigation wing of the Income Tax Department (ITO(I&CI)), on 05.10.2012.The (ITO(I&CI)) calls upon the petitioner to furnish information under Section 133(6) of the Act including bank statements relating to cash deposits over Rs.2 lakhs. On 15.10.2012, the petitioner responds enclosing copies of statements in ICICI, Dhanlaxmi, Axis and other banks wherein the petitioner holds deposits.

The petitioner filed copies of bank statements in Axis, Dhanalaxmi, Yes and Standard Chartered banks. It was admitted that the statement of the account in ICICI Bank was not enclosed and there was nothing either in the communication dated 26.11.2012 filed before the assessing officer or any other record/communication that could lead to a conclusion that this statement had been enclosed.

The order of assessment has come to be passed by the assessing officer under Section 143(3) of the Act on 28.01.2014, based upon the materials available and the petitioner got notice under Section 148 on 29.03.2018 beyond a period of four years from the end of the relevant assessment year.

It was observed that on post finalisation of the assessment, the Department had received information regarding suspicious bank transactions between the period 01.02.2011 to 31.02.2011, wherein an amount of Rs.42.29 crores had been deposited in cash and immediately debited through RTGS and the impugned proceedings for re-assessment have come to be initiated.

Dr Justice AnitaSumanth observed that the criminal investigation wing is separate and distinct from the assessment wing and disclosure made before one wing will not exonerate the petitioner from the requirement of making a ‘full and true disclosure’ before the assessing officer in assessment.

Records summoned and produced by the standing counsel confirmed the averment in counter to the effect that there was no disclosure of the account in ICICI bank R S Puram at the time of assessment. The impugned order was confirmed by the Court and the writ petition got dismissed.

Mr A.S. Sriraman appeared for the petitioner and Mr A. P. Srinivas appeared for the respondent.

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