Reassessment

When the orders of the AO merge with that of appellate authorities, the AO loses his jurisdiction to reopen the assessment, as held by MumTrib in ACIT v BSES Ltd — In favour of: The assessee.

The AO was not justified in reopening the assessment of the assessee on the basis of the tariff order of MERC which was for the different purpose, which was not available at the time of completion of original assessment and the assessee cannot be said to have not disclosed full facts.

The parameters for reopening an assessment on the basis of “Reason to believe” has to be at the time of the initiation of the proceedings and not only at the time of the issue of the notice under s 147 read with s 148

Decided on: 30 September 2011.