G SUKESH Vs. DEPUTY COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) EXHIBIT P-6 series issued by the Deputy Commissioner of Income-tax, Trivandrum, is challenged by the petitioner, who is an assesses. These are notices issued under Section 148 of the Income-tax Act, 1961, for the assessment years 1994-95, 1995-96, 1996-97, 1997-98 and 1998-99 and were issued between November 15, 2000 and December 13, 2000. On receipt thereof, the petitioner had requested the officer to furnish the reasons for resorting to such a step. By reply he was made known that when open enquiry had been made with the petitioner's creditors, it had been revealed that there was no full disclosure, and circumstances were there to reopen the assessments. It has also been revealed in the original petition that the Deputy Director (Investigation) had been making certain enquiries in the matter.

(2.) THE attack is on two grounds. At least some of the notices, according to him, are time barred. It is further averred that the precondition for conferring jurisdiction on the first respondent was absent; there should have been definite reason for him to believe that income chargeable had escaped assessment. Mr. Pandalai, counsel for the petitioner, submits that this was not there, and the statute did not permit the Revenue to go on a fishing expedition, and it did not entitle them to reopen the assessments finalised. It was also stated that for two years, the assessment was completed after scrutiny, under Section 143(3) of the Act. THE steps, accordingly, were to be quashed, and there were no bona fides in the attempt.

(3.) ALSO there is power to recompute the loss or depreciation allowance, or any other allowances, and these are pointers to indicate that the reassessment can be thorough and complete. The Explanation to the section also suggest to the wide power and discretion. When an assessee makes a declaration of his income, and verifies particularly to its correctness, he has to stand by the same, and cannot object to the Department pointing out that from the materials collected, there appears to be an error in the returns. The sanctity of a return becomes susceptible to acid tests when the Assessing Officer stumbles on materials indicating that the returns were not true as is claimed. An opportunity is given for making a clean breast of affairs, and one need not be apprehensive unless he has skeletons in his cupboard. I may quote from the decision of the Supreme Court in Phool Chand Bajrang Lal v. ITO [1993] 203 ITR 456 (page 478) as following :