SREELAKSHMI MUSUNURU,PENAMALURU V. INCOME TAX OFFICER, WARD-2(3), VIJAYAWADA

CO 8/VIZ/2024

AI Insights

The case involves the Income Tax Officer, Ward-2(3), Vijayawada as the appellant and Sreelakshmi Musunuru as the respondent. The dispute arose from the reassessment order for the assessment year 2013-14, where the Assessing Officer (AO) had reopened the assessment under Section 147 of the Income Tax Act, 1961, alleging unexplained investments and income. The Commissioner of Income-Tax (Appeals) partly allowed the appeal, which led the Revenue to challenge the CIT(A)'s decision before the Tribunal. The Tribunal found that the AO had incorrectly assumed jurisdiction and reopened the assessment beyond the permissible period without valid reasons, leading to the quashing of the reassessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 780648 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 27 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 08-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Appeal Filed On: 11-09-2024
• Other Referred Cases: New Delhi Television Ltd. vs. Deputy Commissioner of Income Tax, ACIT Vs. Marico Limited
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA VILLURI
• Assessee Lawyers: C. SUBRAHMANYAM
• Keywords: Set aside; Difference of opinion; Change of opinion; Capital asset; Unexplained investment; Cost of acquisition; Onus to prove; Period of limitation; Reopening of assessment; Capital Gains; Assessment record; Reason to believe
• Section: 147; 148; 143(3); 142(1); 69; 139

Judgement Text

" आयकर अपीलीय अिधकरण, िवशाखापटणम पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Visakhapatnam Bench, Visakhapatnam Before Shri Ravish Sood, Judicial Member and Shri Balakrishnan S., Accountant Member आ.अपी.सं /ITA No.278/Viz/2024 (िनधाŊरण वषŊ/Assessment Year: 2013-14) Income Tax Officer, Ward-2(3), Vijayawada. Vs. Sreelakshmi Musunuru, Penamaluru. PAN: AOJPM4884K (Appellant) (Respondent) C.O. No. 08/Viz/2024 (In आ.अपी.सं /ITA No.278/Viz/2024) (िनधाŊरण वषŊ/Assessment Year: 2013-14) Income Tax Officer, Ward-2(3), Vijayawada. Vs. Sree Lakshmi Musunuru, Penamaluru. PAN: AOJPM4884K (Appellant in appeal) (Respondent / Cross Objector) िनधाŊįरती Ȫारा/Assessee by: Sri C. Subrahmanyam, CA राज̾ व Ȫारा/Revenue by: Dr. Aparna Villuri, Sr. AR सुनवाई की तारीख/Date of Hearing: 25/09/2025 घोषणा की तारीख/Date of Pronouncement: 08/10/2025 Printed from counselvise.com 2 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru आदेश / ORDER PER. RAVISH SOOD, JM : The captioned appeal filed by the Revenue is directed against the order passed by the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi, dated 15/05/2024, which in turn arises from the order passed by the Assessing Officer under Section 147 r.w.s 144 of the Income Tax Act, 1961 (for short, “Act”), dated 24/03/2022 for A.Y. 2013-14. 2. The Revenue has assailed the impugned order on the following grounds of appeal before us: “1. The Ld. CIT(A) erred in deleting the addition made of Rs. 40,45,070/- U/s. 69 r.w.s. 115BBE of the Act by the FAO without appreciating the chronology of events happened and without appreciating the fact that there is no cash balance available with the assessee as on that specific date on which payment was claimed to be made for purchase of the property. 2. The Ld. CIT(A) also ought to have appreciated the fact that the FAO made the said addition of Rs. 40,45,070/- since the assessee failed to furnish cash flow statement for the period under consideration and also confirmation from the party / parties from whom said amount was claimed to be received in the cash on sale of agricultural land. 3. The Ld. CIT(A) erred in deleting the addition made of Rs. 82,00,000/- U/s. 69 r.w.s 115BBE of the Act by the FAO on account of unexplained source of advance given to Sri M. Bala Manmadha Rao, without appreciating the chronology of events happened as stated in previous ground of appeal and without appreciating the fact that there Printed from counselvise.com 3 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru is no cash balance available with the assessee as on that specific date on which advance was claimed to be given to Sri M. Bala Manmadha Rao. 4. The Ld. CIT(A) also ought to have appreciated the fact that the FAO made the said addition of Rs. 82,00,000/- since the assessee failed to furnish cash flow statement for the period under consideration and also confirmation from the party / parties from whom said amount was claimed to be received in cash on sale of agricultural land, as stated in earlier ground of appeal. 5. The Ld. CIT(A) has also erred in not appreciating the fact that the assessee did not produce any evidence / material like confirmation reflecting that the assessee was having sufficient cash balance to make payment for purchase of land and also for advancing the amount to Sri M. Bala Manmadha Rao. 6. The Ld. CIT(A) erred in deleting the addition made of Rs. 1,61,57,000/- by the FAO on account of Short Term Capital Gain without appreciating the fact that the burden of proof lies with the assessee to substantiate the claim made by her by providing necessary supporting documentary evidences / material and the assessee in the instant case failed to furnish evidence proving that the assessee under consideration is not a capital asset. 7. The Ld. CIT(A) ought to have called for a Remand Report before finalizing the issue as to whether the asset under consideration is in the nature of capital asset or not for the purpose of computing the capital gains in the instant case, the Ld. CIT(A) did not do so. 8. Any other grounds of appeal that emerge out of the appeal proceedings from time to time.” 3. Also, the assessee is before us as a Cross Objector on the following grounds: “1. The Ld. CIT(A) erred in dismissing the assessee’s ground of appeal, wherein it was contested that the notice U/s. 148 of the IT Act, 1961 after a period of 4 years from the end of the relevant assessment year is in contravention of the proviso of section 147 of the Act. Printed from counselvise.com 4 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 2. The Ld. CIT(A) erred in dismissing the ground wherein, the contest was notice issued U/s. 148 dated 31/03/2021 is a result of a mere change of opinion by the AO, when the original assessment U/s. 143(3) was completed after due scrutiny and all relevant material facts were disclosed by the assessee. 3. Without prejudice to Ground No. i and ii the notice U/s. 148 of the Act dated 31/03/2021 by the ITO, Ward-2(3), Vijayawada is barred by time considering the provisions of section 149(1)(b) of the IT Act consequently the order passed U/s. 147 r.w.s 144B of the Act dated 24/03/2022 is invalid and void-ab-initio. 4. Without prejudice to the grounds No. i, ii and iii, the assessment completed U/s. 143(3) r.w.s 147 of the IT Act, pursuant to the notice issued U/s. 148 on 01/04/2021, is void ab initio. This is because, under the amended provisions of the IT Act introduced by the Finance Act, 2021, no notice U/s. 148 can be issued without following the procedure prescribed U/s. 148A.” 4. Succinctly stated, the AO based on the information that the assessee, who had filed his return of income for the year under consideration declaring an income of Rs. 2,23,030/-, had during the subject year purchased agricultural land admeasuring 2.80 Acres located at Ganguru from Sri Velivela Venkata Krishna for a consideration of Rs. 70,65,150/- vide Document No. 2683/2013, initiated proceedings under Section 147 of the Act. Notice under Section 148 of the Act, dated 31/03/2021 was issued to the assessee. Printed from counselvise.com 5 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 5. During the course of the assessment proceedings, the AO called upon the assessee to furnish the source of the investment made towards the purchase of the aforesaid property, i.e., agricultural land admeasuring 2.80 Acres situated at Ganguru vide Document No.2683/2013. In reply, it was the assessee’s claim, that she had purchased the subject property for a total consideration of Rs. 76,27,780/- (property value Rs. 70,30,000 + Stamp Value Rs. 5,97,780/-) which was sourced from viz., (i) unsecured loan raised from Sri M. Balamanmadha Rao on 27/03/2013: Rs. 32,30,000/-; and (ii). part payment (made in cash), which in turn was sourced from the sale proceeds of agricultural land that was sold by her vide Document Nos. 2685/2013 and 2684/2013 on 28/03/2013: Rs. 80,78,500/-, each. On being queried about the source of the loans advanced by Sri M. Balamanmadha Rao (supra) on 27/03/2013, the assessee furnished a copy of the bank statement and the return of income of the lender. Also, it was stated by her that Sri M. Balamanmadha Rao (supra) had advanced the subject amount out of the loan of Rs. 49,30,000/- that was received by him in his loan account No. 044430100102226 on 26/03/2013. As regards the Printed from counselvise.com 6 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru cash payment of Rs. 32,30,000/- made on 27/03/2013 the assessee had stated that the same was sourced out of the sale proceeds of agricultural lands that were sold by her, vide (i). Document No. 2685/2013, dated 28/03/2013: Rs. 80,78,500/-; and (ii). Document No. 2684/2013, dated 28/03/2013: Rs. 80,78,500/- However, the AO did not find favour with the aforesaid explanation of the assessee for the reason that as per the Registered Sale Deed, the assessee had sold the subject agricultural lands, vide Documents Nos. 2685/2013 and 2684/2013 on 28/03/2013 and had received the sale consideration at the time of executing the sale deed. Accordingly, the AO was of the view that the part purchase consideration (in cash) that was paid by the assessee for purchasing agricultural lands vide Document No. 2683/2013, dated 27/03/2013, could not have been sourced out of the cash sale proceeds of the agricultural land that was subsequently received by her on 28/03/2013. Also, the AO observed that the assessee had failed to come forth with any explanation in respect of the source of the Stamp Duty of Rs. 5,97,780/- that was incurred by her during the year under consideration. Further, the AO observed that the Printed from counselvise.com 7 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru assessee had also purchased agricultural land vide Document No. 2667/2013 on 27/03/2013 for a consideration of Rs. 2,17,290/- [Principal value: Rs. 2 lakhs (+) Stamp Value: Rs. 17,290/-] but had failed to come forth with any explanation regarding the source of the said investment. Accordingly, the AO, based on his aforesaid observations, held the investments made by the assessee towards the purchase of the subject immovable properties aggregating to Rs. 40,45,070/- as unexplained investments U/s. 69 of the Act. 6. Apart from that, the AO observed that the assessee had, though advanced an amount of Rs. 82 lakhs through banking channels on 30/03/2013, but had failed to come forth with any explanation regarding the source of the said advance. Accordingly, the AO made an addition of the aforesaid amount of Rs. 82 lakhs (supra) to the returned income of the assessee U/s. 69 of the Act. 7. Also, we find that the AO observed that as the assessee had not disclosed the sale proceeds received on the sale of the aforesaid two lands situated at Kolavennu on 28/03/2013 aggregating to Rs. 1,61,57,000/- in her return of income, therefore, Printed from counselvise.com 8 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru in the absence of any documentary evidence regarding its cost of acquisition, held the entire amount of the sale consideration as the Short Term Capital Gains (for short, “STCG”) in the hands of the assessee. Accordingly, the AO vide his order passed U/s. 147 r.w.s 144B of the Act, dated 24/03/2022 determined the income of the assessee at Rs. 2,83,28,530/-. 8. Aggrieved, the assessee carried the matter in appeal before the CIT(A), who partly allowed the same. 9. Ostensibly, the CIT(A) rejected the assessee’s contention wherein she had assailed the validity of the jurisdiction that was assumed by the AO for initiating proceedings under Section 147 of the Act. On merits, we find that the CIT(A) had vacated all three additions that were made by the AO. For the sake of clarity, the observations of the CIT(A) are culled out as under: Printed from counselvise.com 9 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 10 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 11 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 12 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 13 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 14 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 15 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 16 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 10. The Revenue, being aggrieved by the order of the CIT(A), has carried the matter in appeal before us. 11. As the assessee has assailed the validity of the jurisdiction that was assumed by the AO for framing the impugned assessment Printed from counselvise.com 17 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru vide order passed U/s. 147 r.w.s 144B of the Act, dated 24/03/2022, based on multi-facet grounds, we deem it fit to first deal with the same. 12. Sri C. Subrahmanyam, Chartered Accountant, the Learned Authorized Representative (for short “Ld. AR”) for the assessee, at the threshold of the hearing of the appeal, submitted that the AO had grossly erred in law and facts of the case in assuming jurisdiction and reopening the concluded assessment of the assessee based on misconceived facts. Elaborating on his contention, the Ld. AR submitted that though the assessment in the case of the assessee was originally framed vide order U/s. 143(3) of the Act, dated 16/12/2015, Pages 174-175 of the APB, wherein the subject issues involved in the present appeal were looked into by the AO, but the latter, without taking cognizance of the fact that the assessee had already been subjected to an assessment vide order passed U/s. 143(3) of the Act dated 16/12/2015, had initiated proceedings under Section 147of the Act. The Ld. AR to buttress his aforesaid contention had drawn our attention to the copy of the “reasons to believe” based on which proceedings were initiated in Printed from counselvise.com 18 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru her case under Section 147 of the Act, Page 182 – 183 of the APB. Elaborating further on his contention, the Ld. AR submitted that the AO had at “Sl. No. 07” of the “reasons to believe” wrongly observed that ‘the case of the assessee was not subjected to scrutiny earlier for the year under consideration i.e., AY 2013-14’. The Ld. AR submitted, that as the AO had based on misconceived facts and without consulting the assessment record, initiated proceedings in the case of the assessee under Section 147 of the Act, therefore, the order so passed by him in the absence of a valid assumption of jurisdiction cannot be sustained. 13. Elaborating further, the Ld. AR submitted that even otherwise, as the assessee had earlier been assessed by the A.O, vide his order passed under Section 143(3) of the Act, dated 16/12/2015, therefore, as per the “1st proviso” to section 147 of the Act”, in the absence of any failure on her part to fully and truly disclose all the relevant facts necessary for framing of the assessment, her concluded assessment could not have been reopened beyond the period of four Years from the end of the relevant Assessment Year, i.e., beyond 31/03/2018. Printed from counselvise.com 19 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 14. Apart from that, the Ld. AR submitted that as the assessee in the course of the original assessment proceedings had furnished with the AO the requisite details, therefore, it was clearly a case of reopening of the concluded assessment based on a mere “change of opinion’, which is not permissible as per the mandate of law. 15. The Ld. AR to buttress his contention that the case of the assessee had been reopened based on a “change of opinion”, had taken us through the notice that was issued by the AO in the course of the original assessment proceedings U/s. 142(1) of the Act, dated 23/01/2015, Page 130-131 of the APB (Query No.6); reply filed by the assessee in the course of the regular assessment proceedings on 02/12/2015, Page 132 of the APB; reply filed by the assessee dated 23.11.2015, wherein she had, inter alia, furnished the details of the agricultural lands purchased by her during the subject at Gangur, Pages 133-135 of the APB. The Ld. AR submitted that as the AO in the present case had wrongly assumed jurisdiction and reopened the concluded assessment of the assessee, therefore, the assessment order passed by him U/s. 147 Printed from counselvise.com 20 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru r.w.s 144B of the Act, dated 24/03/2022 cannot be sustained and is liable to be struck down. 16. Per contra, Dr. Aparna Villuri, the Learned Departmental Representative (for short “Ld. DR”) relied on the assessment order. The Ld. DR submitted that as the Ld. AO had validly assumed jurisdiction and initiated proceedings u/s 147 of the Act, therefore, no infirmity emanates from the order passed by him under Section 147 r.w.s 144B of the Act, dated 24/03/2022. Apart from that, the Ld. DR submitted that as the CIT(A) had, without any basis, vacated the additions made by the AO based on a well-reasoned order, therefore, the order of the said first appellate authority cannot be sustained and is liable to be set aside. 17. We have heard the Learned Authorized Representatives of both parties, perused the orders of the lower authorities, and the material available on record. 18. As the assessee has assailed the validity of the jurisdiction assumed by the AO for framing the impugned assessment order vide his order passed under Section 147 r.w.s 144B of the Act, Printed from counselvise.com 21 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru dated 24/03/2022, based on his multi-facet contentions, therefore, we deem it apposite to first deal with the same. 19. Before proceeding further, we deem it fit to cull out the “reasons to believe” based on which proceedings in the case of the assessee were initiated by the AO U/s. 147 of the Act, which reads as under: Printed from counselvise.com 22 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru Printed from counselvise.com 23 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 20. As stated by the Ld. AR and rightly so, we find that the assessee was originally assessed by the AO vide his order passed under Section 143(3) of the Act, dated 16/12/2015, wherein his returned income was accepted as such, Page 174-175 of APB. 21. Considering the fact that the assessee was originally assessed by the AO under Section 143(3) of the Act, dated Printed from counselvise.com 24 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 16/12/2015, we are unable to comprehend the observation of the AO in the “reasons to believe” (Sl. No.7) wherein he had observed that the case of the assessee was not subjected to scrutiny assessment earlier for the year under consideration, i.e., AY 2013- 14. We are of the considered view that the AO, without consulting the assessment record of the assessee, had initiated the impugned proceedings under Section 147 of the Act based on his misconceived and wrong observations. As the very basis for initiating the proceedings under Section 147 of the Act, i.e., the AO’s observation that the assessee was not earlier subjected to scrutiny assessment for the year under consideration, i.e., AY 2013-14 is in itself found to be glaringly incorrect, therefore, we have no hesitation to observe that the “reasons to believe” based on which the impugned assessment proceedings had been initiated by him under Section 147 of the Act have no nexus with the material available on record. 22. Apart from that, we find that as the case of the assessee was earlier assessed by the AO vide his order passed U/s. 143(3) of the Act, dated 16/12/2015, therefore, the reopening of her concluded Printed from counselvise.com 25 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru assessment is also hit by the “1st proviso” to Sec. 147 of the Act. Admittedly, the original assessment was framed in the case of the assessee for the year under consideration, i.e., A.Y 2013-14 vide order passed under Sec. 143(3) of the Act, dated 16.12.2015. The concluded assessment of the assessee was thereafter reopened vide notice issued under Sec. 148 of the Act, dated 31.03.2021. It is the claim of the ld. A.R. that the A.O. had exceeded his jurisdiction and framed the order U/s. 147 r.w.s 144B of the Act, dated 24/03/2022, inter alia, for the reason that the same had been passed in violation of the mandate of the “1st proviso” of Sec. 147 of the Act. Admittedly, as stated by the Ld. A.R and, rightly so, in a case where an assessment had earlier been made under Section 143(3) of the Act, and action thereafter is sought to be taken for the reopening of the case u/s.147 after the expiry of four years from the end of the relevant assessment year, then, it would be necessary that the twin conditions contemplated in the statutory provision are satisfied, i.e. (i). the AO must have reason to believe that income chargeable to tax has escaped assessment; AND (ii). he must also have a reason to believe that such escapement had occurred by Printed from counselvise.com 26 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru reason of failure on the part of the assessee for either of the two conditions, viz. (a). to make a return of income under Section 139 or in response to notice issued under sub-section (1) of Section 142 or Section 148; or (b). to disclose fully and truly all material facts necessary for his assessment for that purpose. 23. Coming back to the two conditions carved out in the “1st proviso” to Sec. 147 of the Act, as it is neither the case of the department nor a fact discernible from the record that the income of the assessee chargeable to tax had escaped assessment for the reason that there was any failure on her part to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148, therefore, the first condition contemplated in the “1st proviso” to Sec. 147 is not satisfied by the assessee. 24. We shall now advert to the second condition contemplated in the “1st proviso” to Sec. 147 of the Act, i.e., as to whether or not there has been any failure on the part of the assessee to disclose fully and truly all material facts as were necessary for her Printed from counselvise.com 27 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru assessment for the year under consideration, i.e., A.Y. 2013-14. On a perusal of the record, it transpires that the assessee had disclosed fully and truly all the material facts regarding the purchase of agricultural land admeasuring 2.80 acres at Ganguru. We may herein observe that the Hon’ble Supreme Court in the case of New Delhi Television Ltd. vs. Deputy Commissioner of Income Tax (2020) 116 Taxmann.com 151 (SC), had, inter alia, held that though the assessee is obligated to disclose the “primary facts” but it is neither required to disclose the “secondary facts” nor required to give any assistance to the A.O by disclosure of the other facts and it is for the A.O to decide what inferences are to be drawn from the facts before him. It was observed by the Hon’ble Apex Court that the extended period of limitation for initiating proceedings under the “1st proviso” of Section 147 of the Act would only get triggered where the assessee had failed to disclose fully and truly all material facts necessary for its assessment. Now, in the case before us, we are unable to comprehend what facts the assessee had failed to disclose which would have otherwise justified bringing her case within the realm of the extended time period contemplated Printed from counselvise.com 28 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru in the “1st proviso” of section 147 of the Act. As the assessee had disclosed fully and truly all the material facts regarding the aforesaid issue, i.e., the purchase of agricultural land admeasuring 2.80 acres at Ganguru as was necessary for her assessment for the year under consideration in the course of the original assessment proceedings for the subject year, i.e., AY 2013-14; therefore, she could by no means be held to be in default for the purpose of bringing her within the sweep of “1st proviso” of Section 147 of the Act. Rather, we are of the view that as observed by the Hon’ble Supreme Court in the case of New Delhi Television Ltd. vs. Deputy Commissioner of Income Tax (supra), now when the assessee in the present case before us, had in reply to notice issued u/s 142(1) of the Act, dated 15.10.2015 - Query No. 6 (Page 129 to 131 of APB), vide her letter dated 23.11.2015 filed with the A.O in the course of the original assessment proceedings, disclosed all the primary facts regarding the purchase of agricultural land at Gangur (Page 133- 135 of APB), she was not required to give any further assistance to the AO by disclosure of other facts. Rather, it was for the AO at the stage of the original assessment Printed from counselvise.com 29 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru proceedings to decide what inference should be drawn from the primary facts disclosed by the assessee before him. Accordingly, we are of the firm conviction that in case the AO who had the primary facts regarding the purchase of the agricultural land at Gangur before him in the course of the original assessment proceedings, had any query regarding the source of the investment made by the assesse, then, he could have queried about the same at that stage. We, thus, based on the aforesaid facts, are of a firm conviction that as the assessee had in the course of the original assessment proceedings fully and truly disclosed all the material facts necessary for her assessment, therefore, the A.O, as per the mandate of the “1st proviso” to Section 147 of the Act after having framed the regular assessment in her case vide order passed under Section 143(3) of the Act, dated 16.12.2015 could not have sought to dislodge her concluded assessment after the expiry of a period of four years from the end of the relevant assessment year, i.e., beyond 31.03.2018. 25. Analyzing the scope of the “1st proviso” to Sec. 147 of the Act, which contemplates that where assessment in the assesse's case Printed from counselvise.com 30 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru had been framed u/s 143(3) of the Act, then no action under Sec. 147 shall be taken in its case after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax had escaped assessment for such assessment year for failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment, the Hon’ble Supreme Court had dismissed the Special Leave Petition (SLP) filed by the revenue in ACIT Vs. Marico Limited, 117 taxmann.com 244 (SC), and impliedly approved the decision of the Hon’ble High Court of Bombay in the case of Marico Limited Vs. ACIT, WP NO.1917 of 2019 dated 21.08.2009. The Hon’ble High Court of Bombay in Marico Limited Vs. CIT (supra) [as approved by the Hon’ble Apex Court] had observed as follows: 5. Upon hearing learned counsel for the parties and upon perusal of the documents and record, what we gather is that the notice of reopening of assessment has been issued beyond the period of four years from the assessment year. The reasons recorded by the Assessing Officer are elaborate and refer to various issues on which he wishes to carry out the reassessment. However, the central theme which passes though all these issues is that the Assessing Officer had gathered the information and material from the record of the assessment. For example in Paragraph No. 3 of the reasons which contains several sub- paragraphs which are different elements of the grounds for reassessment begins with the expression \"On perusal of the record for the assessment year 2011-12, the following issues were found\". Thus, with reference to various issues arise on the basis of the perusal of the Printed from counselvise.com 31 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru record of the assessment year in question. Clearly, therefore, there is no material alien to the record which the Assessing Officer has referred to for issuing the impugned notice. Further, almost for every ground which is part of various sub-paragraphs of Paragraph No. 3, he has referred to either scrutiny or verification of the case records. In clear terms, therefore, the Assessing Officer was acting on the information available from the record of the assessment. 6. As is well known, in an instance where the Assessing Officer exercises power of reassessment beyond the period of four years from the end of relevant assessment year, an essential requirement is that the escapement of income chargeable to tax is due to the failure on the part of the assessee to disclose truly and fully all material facts. This is part of section 147 of the Act itself and is on number of occasions by various judgments of High Court and Supreme Court held to be mandatory pre-requirement. In view of such settled law, it is not necessary to refer to any judgment. Revenue is unable to bring to our notice any aspect or element which did not form part of the record and on the basis of which from the reasons recorded, it can be culled out that the Assessing Officer had formed a belief that income chargeable to tax had escaped assessment. In clear terms therefore, there was no failure on the part of the assessee to disclose truly and fully all material facts. 7. Counsel for the revenue however submitted that one of the issues raised by the Assessing Officer is that the activity carried on by the assessee does not amount to manufacturing activity. In the present petition, it is not necessary for us to comment on this aspect of the matter. What is important however is such belief also the Assessing Officer has formed on the basis of material already on record. Looked from any angle, the Assessing Officer cannot justify issuing the notice of reopening of assessment beyond the period of four years from the end of relevant assessment year. 8. Under the circumstances, impugned notice is quashed. Petition allowed and disposed of accordingly. Considering the aforesaid settled position of law, we are of the view that as in the case before the Hon’ble Apex Court in Marico Limited (supra), the concluded assessment in the case of the present assessee before us for the year under consideration, i.e., A.Y 2013- Printed from counselvise.com 32 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 14, had been reopened vide notice u/s 148, dated 31.03.2021, i.e., beyond 4 years from the end of the relevant assessment year not for any failure on her part to fully and truly disclose all material facts necessary for her assessment, therefore, we are of a firm conviction that the said reopening of the concluded assessment of the assessee is clearly hit by the “1st proviso” to Sec. 147 of the Act. 26. We, thus, based on our aforesaid deliberations, find no infirmity in the Ld. AR’s claim that the A.O had wrongly assumed jurisdiction and reopened the concluded assessment of the assessee on two fold reasons, viz. (i). that the case of the assesee had been reopened based on glaringly incorrect and misconceived facts without consulting the assessment record, i.e., by wrongly observing in the “reasons to believe” that the assessee was not earlier subjected to scrutiny assessment for the year under consideration, i.e., AY 2013-14; and (ii). that the concluded assessment of the assessee for the year under consideration, i.e., A.Y 2013-14, had been reopened, vide notice u/s 148, dated 31.03.2021, i.e., beyond 4 years from the end of the relevant assessment year, not for any failure of the assessee to fully and Printed from counselvise.com 33 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru truly disclose all material facts necessary for her assessment; therefore, the order passed by him U/s. 147 r.w.s 144B of the Act, dated 24/03/2022, cannot be sustained for want of valid assumption of jurisdiction. 28. We thus, in terms of our aforesaid deliberations, quash the assessment framed by the AO under Section 147 r.w.s 144B of the Act, dated 24/03/2022, for want of valid assumption of jurisdiction on his part. 29. As we have quashed the assessment order passed by the AO in terms of our aforesaid deliberations, therefore, we refrain from adverting to and dealing with the remaining grounds based on which the assessee has assailed the validity of the assessment order, which, thus, are left open. Also, as we have quashed the impugned assessment framed by the AO, therefore, the appeal filed by the Revenue, wherein the order passed by the CIT(A) vacating the additions made by the AO has been assailed before us having been rendered as merely academic in nature is left open. Printed from counselvise.com 34 ITA No. 278/Viz/2024& CO. No. 08/Viz/2024 ITO vs. Sreelakshmi Musunuru 30. Resultantly, the Cross Objection filed by the assessee is allowed, and the appeal filed by the Revenue is dismissed as having been rendered as academic in nature. Order pronounced in te open court on 08th October, 2025. Sd/- (BALAKRISHNAN S.) ACCOUNTANT MEMBER Sd/- (RAVISH SOOD) JUDICIAL MEMBER Hyderabad, Dated: 08th October, 2025 **OKK / SPS Copy to: S.No Addresses 1 Sreelakshmi Musunuru, 3-55/1, Near Sivalayam, Penamaluru, Andhra Pradesh-. 2 Income Tax Officer, Ward-2(3), 1st Floor, CR Buildings, MG Road, Vijayawada, Andhra Pradesh-520002. 3 The Pr.CIT, Visakhapatnam 4 The DR, ITAT Visakhapatnam Benches 5 Guard File TRUE COPY Sr. Private Secretary, ITAT, Visakhapatnam. Printed from counselvise.com "