A.C.I.T Cir - 35,kolkata, Kolkata V. M/s Mor Overseas, Kolkata

ITA 951/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4848 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 1996-1997
• Appeal Filed On: 25-04-2013
• Court: TRIBUNAL
• Assessee Lawyers: S P CHOWDHURY
• Keywords: Search and seizure; Document seized; Period of limitation; Difference of opinion; Time period of passing order; Reason to believe; Documents seized; Change of opinion; Reassessment proceedings
• Section: 143(3); 147; 148

Judgement Text

1 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH B KOL KATA [BEFORE HONBLE SHRI N.V.VASUDEVAN, JM & SHRI M.B ALAGANESH, AM ] ITA NO.951/KOL/2013 ASSESSMENT YEAR : 1996-97 A.C.I.T., CIRCLE-35, , -VERSUS- M/S. MORE OVERSEA S KOLKATA KOLKATA (PAN:AAEFM5102B) (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI SANJAY MUKHERJEE, JCIT, SR.DR FOR THE RESPONDENT : SHRI S.P.CHOWDHURY, ADVOCATE DATE OF HEARING : 04.04.2016. DATE OF PRONOUNCEMENT :.11.05.2016. ORDER PER N.V.VASUDEVAN, JM ITA NO.951/KOL/2013 IS AN APPEAL BY THE REVENUE DIR ECTED AGAINST THE ORDER DATED 14.12.2012 OF CIT(A)-XX, KOLKATA, RELATING TO AY 1996-97. 2. THERE IS A DELAY OF 25 DAYS IN FILING THIS APPE AL BY THE REVENUE. THE REASONS HAVE BEEN EXPLAINED IN AN AFFIDAVIT BY THE APPELLANT AS OWING TO ADMINISTRATIVE CONSTRAINTS. THE REASONS GIVEN IN OUR VIEW ARE SUFFICIENT AND RE ASONABLE. HENCE, THE DELAY IN FILING THE APPEAL IS CONDONED 3. AS FAR AS THE APPEAL OF THE REVENUE IS CONCERNE D, THE FACTS ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF IMPORT OF POLYPROPYLENE AND SELLS THEM WHEN THE IMPORTED GOODS ARE IN THE COURSE OF IMPORT AND WHILE THEY ARE IN HIGH SEA. FOR AY 96-97, THE ASSESSEE FILED A RETURN OF INCOME ON 2.12.96 DECLARING TOTAL INCOME OF RS.36,120/-. AN ORDER OF ASSESSMENT WAS PASSED U/S.143(3) OF THE ACT DT.30.3.99. THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED BY THE AO IN THE SAID ORDER AT RS.47,77,790/-. IN THE SAID ORDER OF ASSESSMENT TH E AO HAS ACKNOWLEDGED THE FACT THAT 2 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 THERE WAS A SEARCH AND SEIZURE OPERATION AT THE BUS INESS PREMISES OF THE ASSESSEE AS WELL AS ITS SISTER CONCERNS AT NO.23A, N.S.ROAD, CA LCUTTA BY THE DEPARTMENT OF REVENUE INTELLIGENCE (DRI) ON 30.11.1995, 1.12.1995 AND 3.6.1996. BOOKS OF ACCOUNTS SEIZED BY THE DRI WERE REQUISITIONED BY TH E INCOME TAX DEPARTMENT U/S.132A OF THE INCOME TAX ACT, 1961 (ACT). BASED ON THE SEIZED DOCUMENTS SO REQUISITIONED, THE AO CAME TO THE CONCLUSION THAT T HE ASSESSSEE HAD MADE SALES TO SAIGAL ENTERPRISES OF RS.72,56,815 BUT RECORDED ON LY SALES OF RS.26,10,613 IN THE BOOKS OF ACCOUNTS. THE DIFFERENCE OF RS.46,46,202 WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. THE AFORESAID ADDITION WAS CHALLEN GED BY THE ASSESSEE BEFORE CIT(A) AND ON FURTHER APPEAL THE ITAT IN ITA NO.1173/KOL/2 001 BY ITS ORDER DATED 30.9.04 HAD DELETED THE ADDITION SO MADE. THE MATTER STOOD THUS IN SO FAR AS THE ORIGINAL PROCEEDINGS U/S.143(3) OF THE ACT ARE CONCERNED. 4. THE AO ON 28.3.2003 HAD ISSUED A NOTICE U/S.148 OF THE ACT FOR AY 1996-97 FOR BRINGING TO TAX INCOME THAT HAS ESCAPED ASSESSMENT. THE REASONS RECORDED BY THE AO FOR ISSUE OF NOTICE U/S.148 OF THE ACT ARE AS FOLLO WS : 'INFORMATION HAD BEEN RECEIVED FROM DIRECTORATE OF REVENUE (INTELLIGENCE) THAT THE AFORESAID ASSESSEE HAD BEEN IMPORTING HUGE CONSIGNM ENTS WITHOUT PAYING CUSTOMS DUTY BY FORGING IMPORT DOCUMENTS. SUCH DOCUMENTS IN RESP ECT OF THE AFORESAID TWO ASSESSES HAVE BEEN RECEIVED FROM A. C. I. T., CIR. -34, KOLK ATA. ON PERUSAL IT HAS COME TO NOTICE THAT BOTH THE AFORESAID TWO ASSESSES HAD IMPORTED C ONSIGNMENTS OF POLYPROPYLENE GRADE H-4500, HDPE WORTH SEVERAL LAKHS OF RUPEES AGAINST BILLS OF ENTRY WITH SPECIFIC NUMBERS. THE DIRECTORATE OF REVENUE INTELLIGENCE HA D ISSUED SHOW-CAUSE NOTICE ON ACCOUNT OF EVASION OF DUTY ON IMPORTS AND ALL THESE IMPORTS PRIMA FACIE ARE FOUND NOT DISCLOSED FOR INCOME TAX PURPOSE IN RELEVANT ASSESS MENT YEAR. HENCE, I HAVE REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED A SSESSMENT AND IT IS LIKELY TO EXCEED RS. 1,00,000/- AS FOUR YEARS HAVE ALREADY ELAPSED, YOUR HONOUR'S SANCTION IS SOUGHT FOR AS PER SEC. 149, READ WITH SEC. 151 TO ISSUE NOTICE U/S. 148 IN RESPECT OF AFORESAID ASSESSEE. I WOULD LIKE TO ADD FURTHER IN THIS CONNE CTION THAT IN RESPECT OF BOTH THE CASES APPEALS ARE PENDING BEFORE HON'BLE I. T.A. T. AGAIN ST ASSESSMENT COMPLETED U/S. 143(3) FOR THE RELEVANT ASSESSMENT YEAR. THE LIMITATION PERIOD FOR ISSUE OF NOTICE U/S. 148 IN BOTH THE CASES EXPIRE ON 31.03.2003.' 5. THE AO PASSED AN ORDER OF ASSESSMENT U/S.147 READ WITH SEC.143(3) OF THE ACT DATED 31.3.2004. IN THE SAID ORDER THE AO HAS REFE RRED TO THE FACT THAT THE 3 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 COMMISSIONER OF CUSTOMS, CUSTOMS HOUSE, KANDLA IN H IS ORDER DATED 28.9.2000 HAD FOUND THAT THE ASSESSEE HAD DURING THE PREVIOUS YEA R RELEVANT TO AY 2006-07 IMPORTED MTS POLYPROPYLENE AND SOUGHT CLEARANCE OF THE SAME FROM THE KANDLA CUSTOMS HOUSE WITH FORGED/TAMPERED LICENCES AND EVA DED CUSTOMS DUTY. THE AO HAS FURTHER REFERRED TO THE FACT THAT WHEN THE ABOVE FA CTS WERE CONFRONTED TO THE ASSESSEE, THE ASSESSEE PLEADED THAT THE AFORESAID SALES HAD B EEN DULY DISCLOSED IN THE BOOKS OF ACCOUNTS MAINTAINED ON THE BASIS OF WHICH TOTAL INC OME WAS DECLARED UNDER THE ACT AND THAT THE SALES WERE MADE TO TWO PARTIES BY NAME PAN AM IMPEX CORPORATION THE AO AFTER RECORDING HIS INABILITY TO SERVE NOTICE U/ S.133(6) OF THE ACT ON PARTY AT THE ADDRESS GIVEN BY THE ASSESSEE THEREAFTER ISSUED A S HOW CAUSE NOTICE DATED 18.3.2004 TO THE ASSESSEE TO SHOW CAUSE AS TO WHY THE CUSTOMS DUTY EVADED BE NOT TREATED AS UNDERSTATEMENT OF SALES/CLOSING STOCK. THE AO AFTE R REFERRING TO THE ORDER OF COMMISSIONER OF CUSTOMS DATED 28.12.2000 HELD THAT THE ASSESSEE EVADED CUSTOMS DUTY AMOUNTING TO RS.50,28,097, RS.50,28,097, RS.53 .,63,303 AND RS.53,63,303 RESPECTIVELY AND THE SAME HAS TO BE REGARDED AS SUP PRESSED SALES NOT RECORDED IN THE REGULAR BOOKS OF ACCOUNTS AND ADDED THE AFORESAID S UM TO THE TOTAL INCOME OF THE ASSESSEE. THE AFORESAID ADDITION WAS IN RESPECT OF EVASION OF CUSTOMS DUTY ON IMPORT OF 256 MTS, 240 MTS, 240 MTS AND 256 MTS OF POLY PROPYLENE ON 4 DIFFERENT OCCASIONS BY THE ASSESSEE. 6. THE ASSESSEE CHALLENGED THE VALIDITY OF INITIAT ION OF REASSESSMENT PROCEEDINGS U/S.148 OF THE ACT BEFORE THE CIT(A). THE REASONS R ECORDED BY THE AO BEFORE ISSUING NOTICE U/S.148 OF THE ACT ARE SET OUT IN PARA-4 OF THIS ORDER. THE ASSESSEE CONTENDED BEFORE CIT(A) THAT THE INITIATION OF REASSESSMENT P ROCEEDINGS IS BARRED BY TIME AS LAID DOWN IN THE PROVISO TO SEC.147 OF THE ACT. IT WAS SUBMITTED THAT UNDER THE PROVISO TO SEC.147 OF THE ACT, WHERE AN ASSESSMENT HAS BEEN CO MPLETED U/S 143(3) OF THE ACT, AND THEREAFTER THE AO SEEKS TO TAKE AN ACTION U/S 1 47 OF THE ACT FOR RE-ASSESSMENT OF INCOME ESCAPING ASSESSMENT AFTER THE PERIOD OF 4 YE ARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, THAN SUCH PROCEEDINGS CAN BE INITI ATED ONLY WHERE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR THAT ASSESSMENT B Y REASONS OF FAILURE ON THE PART OF 4 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERI AL FACTS NECESSARY FOR HIS ASSESSMENT FOR THAT YEAR. ACCORDING TO THE ASSESSEE THE ASSESS MENT IN THE PRESENT CASE WAS SOUGHT TO BE RE-OPENED, AFTER EXPIRY OF 4 YEARS FROM THE E ND OF THE RELEVANT ASSESSMENT YEAR AND AN ORDER OF ASSESSMENT U/S 143(3) HAS ALREADY B EEN PASSED. IT WAS THEREFORE, SUBMITTED BY HIM THAT THE PROCEEDINGS U/S 147 OF TH E ACT ARE BARRED BY TIME. IN THIS REGARD, IT WAS ALSO ARGUED EVEN IN THE REASONS RECO RDED THERE IS NO REFERENCE TO THE FAILURE ON THE PART OF THE ASSESSEE TO FULLY AND TR ULY DISCLOSE THE MATERIAL FACTS. RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF HINDUSTAN LEVER LTD. VS. ACIT 268 ITR 332 (BOM) WHE REIN ON IDENTICAL FACTS INITIATION OF REASSESSMENT PROCEEDINGS WERE HELD TO BE INVALID. IT WAS SUBMITTED THAT ON IDENTICAL FACTS, INITIATION OF REASSESSMENT PROC EEDINGS U/S.147 OF THE ACT IN THE CASE OF ANOTHER SISTER CONCERN OF THE ASSESSEE VIZ., ASH WANI KUMAR MORE IN ITA NO.953/KOL/2005 ORDER DATED 15.7.2006, WAS HELD TO BE BAD IN LAW AND THE ORDER OF THE TRIBUNAL HAS ALSO BEEN UPHELD BY THE HONBLE CA LCUTTA HIGH COURT. IT WAS POINTED OUT THAT THE ITAT IN COMING TO THE AFORESAID CONCLU SION HAD PLACED RELIANCE ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F COCA COLA EXPORT CORPORATION VS. ITO 231 ITR 200 (SC) WHEREIN IT WAS HELD THAT W HEN FACTS SHOWED THAT IMPORTS WERE DULY RECORDED IN THE BOOKS OF ACCOUNTS, THERE WAS NO BASIS TO FORM OPINION REGARDING ESCAPEMENT OF INCOME. IT WAS ALSO ARGUED THAT INITIATION OF REASSESSMENT PROCEEDINGS WERE BASED ON A MERE CHANGE OF OPINION AND RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CAS E OF CIT VS. KELVINATOR OF INDIA LTD. 256 ITR 1(DEL.). 7. THE CIT(A) ON CONSIDERATION OF THE ABOVE SUBMIS SIONS HELD THAT INITIATION OF REASSESSMENT PROCEEDINGS WERE BAD IN LAW AND IN HOL DING SO FOLLOWED THE DECISION OF THE HONBLE ITAT IN THE CASE OF ASHWINI KUMAR MORE (SUPRA). THE FOLLOWING WERE THE RELEVANT OBSERVATIONS OF THE CIT(A): 4.2. I HAVE PERUSED THE ASSESSMENT ORDER AND CONSI DERED THE SUBMISSION OF THE APPELLANT. IN THE CASE OF SHRI ASHWANI KUMARE MORE, A.Y. 1996-97 ON THE IDENTICAL FACTS, THE ITAT, KOLKATA 'C' BENCH IN THEIR ORDER N O. I.T.A. NO.953 (KOL) OF 2005 DATED 14.07.2006 HAS HELD- 'WE HAVE PERUSED THE ORDERS OF AUTHORITIES CAREFULLY AND ALSO 5 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 PERUSED THE DECISION OF THE HON'BLE SUPREME COURT I N THE CASE OF COCO COLA (SUPRA) AND THE REASONS RECORDED BY THE AO AND WE FIND THAT IN THE PRESENT CASE THE RATIO OF THE ABOVE DECISION IS SQUARELY APPLICABLE. THEREFORE, W E HOLD THAT THERE WAS INHERENT LACK OF JURISDICTION IN THE ITO TO ISSUE THE NOTICE U/S.148 MERELY ON THE BASIS OF ACTION INITIATED BY CU TOT DEPARTMENT. THE CUSTOM ACT AND I.T. ACT O PERATE IN TWO DIFFERENT FIELDS. EVEN II THERE IS A CASE OF CUSTOM DUTY EVASION, THA T WILL BE DEALT' BY THE CUSTOM DEPARTMENT. WE AGREE WITH THE ID. COUNSEL THAT EVEN IF FINALLY IT IS ESTABLI SHED THAT THE ASSESSEE HAD EVADED CUSTOM DUTY, THAT WILL BE A LIA BILITY FOR THE ASSESSEE BUT UNDER NO CIRCUMSTANCES IT CAN BE TAKEN AS INCOME OF THE ASSE S ASSESSABLE UNDER THE I.T. ACT. THEREFORE, WE HOLD THAT THE JURISDICTION U/S.147 HA S NOT BEEN VALIDLY ASSUMED. ' 8. SINCE THE INITIATION OF REASSESSMENT PROCEEDING S WERE HELD TO BE BAD AND INVALID, THE CIT(A) DID NOT CONSIDER THE CASE OF THE ASSESSE E ON MERITS. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVENUE IS IN APPEAL BEFOR E THE TRIBUNAL. THE GROUNDS OF APPEAL OF THE REVENUE READS AS FOLLOWS: 1. THE LD. CIT(A) ERRED IN GIVING RELIEF ON SALE O F IMPORTED GOODS THEREBY SUPPRESSING THE REALIZATION OF IMPORT DUTY TO THE ASSESSEE BY A LLOWING THE ASSESSEE RS.2,07,82,800/- 2. FOR THAT THE A.O HAS STARTED PROCEEDINGS OF 147 IS BASED ON MATERIALS IN RECORD. THE MATERIAL IS UNDER EXAMINATION WITH CEGAT. THE AMOUN T INVOLVE IN THIS CASE NOT LESS THAT RS.2,07,82,800/- AND THE INFORMATION HAS NOT BEEN PROVED INCORRECT. THE ADDITION ON THE PART OF CUSTOM DUTY EVASION RESULTING IN E VASION OF INCOME TAX AS THE ASSESSEE HAS NOT SHOWN THE SALES IN REGULAR BOOKS O F ACCOUNT SO IT CAN BE TERMED AS SUPPRESSED SALES, WHICH THE A.O. HAS RIGHTLY OBSERV ED IN HIS ORDER U/S 147/143(3). 3. THE DEPARTMENT CRAVES LEAVE TO PUT ADDITIONAL GR OUND/GROUNDS AND/OR TO ALTER/AMEN D/MODIFY THE PRESENT GROUNDS. 9. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED DR WHO SUBMITTED THAT THE INFORMATION RECEIVED FROM THE CUSTOMS AUTHORITIES W AS A VALID BASIS TO FORM OPINION REGARDING ESCAPEMENT OF INCOME AND FOR INITIATION O F REASSESSMENT PROCEEDING. THE LEARNED AR RELIED ON THE ORDER OF CIT(A) AND CONTEN TIONS PUT FORTH BEFORE THE CIT(A). 10. WE HAVE GIVEN A VERY CAREFUL CONSIDERATION TO THE RIVAL SUBMISSIONS. ON IDENTICAL FACTS PROCEEDINGS FOR REASSESSMENT WERE INITIATED I N THE CASE OF SHRI ASHWANI KUMAR MORE FOR AY 1996-97. ASHWANI KUMAR MORE IS A BUSIN ESS ASSOCIATE OF THE ASSESSEE CARRYING ON BUSINESS AT THE SAME BUSINESS PREMISES OF THE ASSESSEE AND WAS SUBJECTED TO SEARCH AND SEIZURE OPERATIONS BY THE DRI. IN HI S CASE REASSESSMENT PROCEEDINGS WERE INITIATED ON IDENTICAL REASONS. THE REASONS R ECORDED IN THE CASE OF ASHWANI 6 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 KUMAR MORE (SUPRA) ARE SET OUT IN PARA 9 PAGE-5 OF THE ORDER OF THE TRIBUNAL DATED 14.7.2006 A COPY OF WHICH IS PLACED AT PAGES 16 TO 24 OF THE ASSESSEES PAPER BOOK. THE OPERATIVE PORTION OF THE SAID ORDER HAS ALREADY BEEN EXTRACTED BY THE CIT(A) IN HIS ORDER WHICH WE HAVE SET OUT IN PARA-7 OF THIS ORDER . IT IS CLEAR FROM THE ORDER OF THE TRIBUNAL THAT NO REASSESSMENT PROCEEDINGS COULD BE INITIATED MERELY ON THE BASIS OF ACTION INITIATED BY CUSTOMS DEPARTMENT. WE ALSO FI ND THAT IN THE CASE DECIDED BY THE TRIBUNAL THE STAGE AT WHICH REASSESSMENT PROCEEDING S WERE INITIATED U/S.147 OF THE ACT WAS WHEN SHOW CAUSE NOTICE WAS ISSUED BY THE CUSTOM S AUTHORITES AND IN THE REASONS RECORDED BY THE AO IN THE PRESENT CASE ALSO IT WAS AT THE STAGE OF SHOW CAUSE NOTICE BEFORE THE CUSTOMS AUTHORITIES. THE DECISION RENDE RED BY THE TRIBUNAL WILL THEREFORE SQUARELY APPLY TO THE PRESENT CASE . 11. WE ARE ALSO OF THE VIEW THAT ADMITTEDLY, THE P ROVISO TO SEC.147 OF THE ACT REFERRED TO IN THE EARLIER PART OF THIS ORDER IS APPLICABLE IN THE PRESENT CASE SINCE ASSESSMENT FOR AY 96-97 HAD BEEN COMPLETED BY THE AO ORIGINALLY U/ S.143(3) OF THE ACT AND THE REASSESSMENT PROCEEDINGS WERE SOUGHT TO BE INITIATE D ON 28.3.2003 BEYOND A PERIOD OF 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEA R. THE AO FOR INITIATING THE RE- OPENING OF THE ASSESSMENT PROCEEDINGS BEYOND THE PE RIOD OF 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR HAS TO ESTABLISH THAT THERE WAS ESCAPEMENT OF INCOME CHARGEABLE TO TAX BECAUSE OF THE FAILURE OF THE ASS ESSEE TO DISCLOSE FULLY AND TRULY THE MATERIAL FACTS NECESSARY FOR THE ASSESSMENT. NEITH ER IN THE REASONS RECORDED FOR RE- OPENING THE ASSESSMENT NOR IN THE ORDER OF RE-ASSES SMENT U/S147 OF THE ACT. THE AO HAS NOT BROUGHT OUT FACTS TO SHOW ANY OMISSION ON T HE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY THE MATERIAL FACTS WHEN THE ORIGINA L ASSESSMENT WAS COMPLETED. WE ARE OF THE VIEW THAT THE RE-OPENING OF THE COMPLETED AS SESSMENT U/S 143(3) OF THE ACT BEYOND THE PERIOD OF 4 YEARS CANNOT BE JUSTIFIED. W E HOLD THAT THE RE-OPENING OF THE ASSESSMENT IS BEYOND THE TIME CONTEMPLATED BY THE P ROVISO TO SEC.147 OF THE ACT AND THEREFORE, INITIATION OF RE-ASSESSMENT PROCEEDINGS IS HELD TO BE BAD. 7 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 12. IN THIS REGARD WE FIND THAT THE DECISION OF TH E HONBLE BOMBAY HIGH COURT IN THE CASE OF HINDUSTHAN LEVER LTD. (SUPRA) SUPPORTS THE PLEA OF THE ASSESSEE. IN THE SAID DECISION THE HONBLE BOMBAY HIGH COURT, ON IDENTICA L FACTS AS IN THE CASE OF THE PRESENT ASSESSEE BEFORE US, HELD AS FOLLOWS: WHERE AN ASSESSMENT UNDER SUB-S. (3) OF S. 143 HAS BEEN MADE FOR RELEVANT ASSESSMENT YEAR, NO ACTION CAN BE TAKEN UNDER S. 14 7 AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLES S ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REAS ONS OF THE FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE ALL MATERIAL FACTS NECESSA RY FOR HIS ASSESSMENT FOR THAT ASSESSMENT YEAR. THE REASONS RECORDED BY THE AO NOW HERE STATE THAT THERE WAS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND T RULY ALL MATERIAL FACTS NECESSARY FOR THE ASSESSMENT OF THAT ASSESSMENT YEAR. IT IS NEEDL ESS TO MENTION THAT THE REASONS ARE REQUIRED TO BE READ AS THEY WERE RECORDED BY THE AO . NO SUBSTITUTION OR DELETION IS PERMISSIBLE. NO ADDITIONS CAN BE MADE TO THOSE REAS ONS. NO INFERENCE CAN BE ALLOWED TO BE DRAWN BASED ON REASONS NOT RECORDED. IT IS FO R THE AO TO DISCLOSE AND OPEN HIS MIND THROUGH REASONS RECORDED BY HIM. HE HAS TO SPE AK THROUGH HIS REASONS. IT IS FOR THE AO TO REACH TO THE CONCLUSION AS TO WHETHER THE RE WAS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR HIS ASSESSMENT FOR THE CONCERNED ASSESSMENT YEAR. IT IS FOR THE AO TO FORM HIS OPINION. IT IS FOR HIM TO PUT HIS OPINION ON RECORD IN BLACK AND WHITE. THE REASO NS RECORDED SHOULD BE CLEAR AND UNAMBIGUOUS AND SHOULD NOT SUFFER FROM ANY VAGUENES S. THE REASONS RECORDED MUST DISCLOSE HIS MIND. REASONS ARE THE MANIFESTATION OF MIND OF THE AO. THE REASONS RECORDED SHOULD BE SELF-EXPLANATORY AND SHOULD NOT KEEP THE ASSESSEE GUESSING FOR THE REASONS. REASONS PROVIDE LINK BETWEEN CONCLUSION AN D EVIDENCE. THE REASONS RECORDED MUST BE BASED ON EVIDENCE. THE AO, IN THE EVENT OF CHALLENGE TO THE REASONS, MUST BE ABLE TO JUSTIFY THE SAME BASED ON MATERIAL AVAILABLE ON RECORD. HE MUST DISCLOSE IN THE REASONS AS TO WHICH FACT OR MATERIA L WAS NOT DISCLOSED BY THE ASSESSEE FULLY AND TRULY NECESSARY FOR ASSESSMENT OF THAT AS SESSMENT YEAR, SO AS TO ESTABLISH VITAL LINK BETWEEN THE REASONS AND EVIDENCE. THAT V ITAL LINK IS THE SAFEGUARD AGAINST ARBITRARY REOPENING OF THE CONCLUDED ASSESSMENT. TH E REASONS RECORDED BY THE AO CANNOT BE SUPPLEMENTED BY FILING AFFIDAVIT OR MAKIN G ORAL SUBMISSION, OTHERWISE, THE REASONS WHICH WERE LACKING IN THE MATERIAL PARTICUL ARS WOULD GET SUPPLEMENTED BY THE TIME THE MATTER REACHES TO THE COURT, ON THE STRENG TH OF AFFIDAVIT OR ORAL SUBMISSIONS ADVANCED. THE IMPUGNED NOTICE ITSELF BEING BEYOND T HE PERIOD OF FOUR YEARS FROM THE END OF THE ASST. YR. 1996-97 AND NOT COMPLYING WITH THE REQUIREMENTS OF PROVISO TO S. 147, THE AO HAD NO JURISDICTION TO REOPEN THE ASSES SMENT PROCEEDINGS WHICH WERE CONCLUDED ON THE BASIS OF ASSESSMENT UNDER S. 143(3 ). ON THIS SHORT COUNT ALONE THE IMPUGNED NOTICE IS LIABLE TO BE QUASHED AND SET ASI DE. 13. EVEN ON THE BASIS OF THE ABOVE CONTENTION, WE ARE OF THE VIEW THAT THE ORDER OF THE CIT(A) IS JUST AND PROPER AND CALLS FOR NO INTERFER ENCE. WE THEREFORE CONFIRM THE ORDER OF THE CIT(A) AND DISMISS THE APPEAL BY THE R EVENUE. 8 ITA NO.951/KOL/2013-M/S.MORE OVERSEAS-A.Y.1996-97 14. IN THE RESULT, THE APPEAL BY THE REVENUE IS DI SMISSED. O RDER PRONOUNCED IN THE COURT ON 11.05.2016. SD/- SD/- [M.BALAGANESH ] [ N.V.VASUDEVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 11.05.2016. [RG PS] COPY OF THE ORDER FORWARDED TO: 1.M/S. MORE OVERSEAS, 23A, N.S.ROAD, 1 ST FLOOR, ROOM NO.30, KOLKATA-700001. 2.A.C.I.T., CIRCLE-35, KOLKATA 3. CIT(A)-XX, KOLKATA 4. CIT-XII, KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY B Y ORDER, ASST. REGISTRAR, ITAT, KOLKATA BENCHES KOLKATA BENCHES