GINNI FILAMENTS LTD Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) These two petitions were heard together and are being disposed of by a common judgment. They arise out of proceedings initiated under Section 147 of the Income Tax Act against the Petitioner for the assessment years 2000-2001 and 2001-2002.

(2.) The Petitioner is a public limited company registered under the Companies Act. It is engaged in the business of manufacturing of yarn and knitted fabrics from its industrial undertaking situate in District Mathura. The Petitioner claims that it is a 100% Export Oriented Unit, (the EOU) and its income is exempt under Section 10 B of the Act. For the relevant assessment years, the assessments were completed under Section 143(1). Alongwith the Income Tax Return, audited statement of account for the relevant assessment years alongwith the report of the statutory auditors under the Companies Act, Tax Audit Report under Section 44-AB of the Act and statement showing computation of income were filed by the Petitioner. Subsequent thereto, notices for reassessment for these two years were issued by the Assessing Officer on the ground that the income has escaped assessment to tax. In response to the notice, returns of income have been filed. A copy of the reasons recorded by the Assessing Officer was served on the Petitioner. The present petitions have been filed questioning the legality and validity of the initiation of reassessment proceedings on the ground that there is no sufficient material on the record to form a reason to believe that income of the Petitioner has escaped assessment.

(3.) In the counter-affidavit, the Department has sought to justify its stand. The claim of the Petitioner that it is 100% EOU and is covered under the provisions of Section 10 B of the Act has been disputed.