IN SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO(S).4735/2008 M/S GIRILAL & COMPANY APPELLANT(S) VERSUS INCOME TAX OFFICER,MUMBAI & ORS. RESPONDENT(S) ORDER Heard learned counsel for parties. appellant, partnership firm, is engaged in business of construction of buildings and development of real estate. In year 2000, appellant/firm was engaged in developing two housing projects on plot bearing CTS No. 329 B(Part) of village Kondiwita in Andheri (East) Mumbai (hereinafter referred to as 'the said plot'). said plot was acquired by appellant originally as capital asset but portion thereof was converted at different points of time into stock-in-trade. appellant on 29.10.2001 filed its return of income for Assessment Year 2001-02. After scrutiny of said return of income, notice dated 15.03.2007 was served on appellant under Section 148 of Income Tax Act, 1961 (hereinafter referred to as 'the Act') inter alia alleging that appellant's income chargeable to tax for Assessment Year 2001-02 has escaped assessment within meaning of Section 147 Signature Not Verified Digitally signed by of Act. On 1st May, 2003, assessment order was passed under ASHWANI KUMAR Date: 2016.08.23 16:25:06 IST Reason: Section 143(3) of Act determining total income at Rs. 12,36,393/- after allowing deduction under Section 80-1B(10) of 2 Act. Vide communication dated 11.04.2007 appellant sought reason recorded for re-opening assessment which were made available to appellant on 12.04.2007. It was found that appellant had not correctly disclosed actual assets of said plot and hence appellant was not entitled for deduction under Section 80(1B) (10) of Act. It was noted that information regarding actual size of plot used for construction was only available in valuation report and hence case is covered under Explanation 2(c)(iv) of Section 147 of Act. appellant objected assumption of jurisdiction under Section 148 for reason that appellant had disclosed all facts fully and truly and respondent no. 1 was fully aware of FSI. Respondent no. 2 rejected objections. Being aggrieved, appellant preferred writ petition before High Court challenging notice dated 15.03.2007 issued under Section 147 of Act. High Court vide impugned judgment dated 12.12.2007 dismissed writ petition. Hence, present appeal. Mr. S. Ganesh, learned senior counsel appearing on behalf of appellant/firm submits that there was no reason to open assessment when in return filed by appellant full disclosure of all relevant facts was made. On this basis, it is further argued that it was merely case of change of opinion which is not valid ground for reopening of assessment. In order to buttress his submission he has drawn our attention to communication dated 10.02.2003 addressed by appellant to Assessing Officer. In para 11 thereof, there is mention about 3 land in question. After going through same, we are constrained to reject aforesaid submission of learned senior counsel for appellant. In para 11, only value of land is stated and in support, certificate from registered Architect & Engineer is filed. It is clear from above that this information was supplied as there was some query about value of land. Obviously, while going to this document Assessing Officer would examine value of land. However, reason for issuing notice under Section 148 of Income Tax Act was that appellant had not correctly disclosed actual assets of plot and hence, it was not entitled for deduction under Section 80(1B) (10) of Act. Income Tax Authority itself has mentioned in notice under Section 148 of Act that such information was available only in valuation report. Giving information in this manner shall be of no help to appellant as Assessing Officer was not expected to go through said information available in valuation report for purpose of ascertaining actual construction of plot. On facts of this case, therefore, we find that Revenue was right in reopening assessment and High Court has rightly dismissed writ petition of appellant challenging validity of notice under Section 148 of Act with following observations: 4 6. Considering tests laid down by Supreme Court in Raymond Woolen Mills Ltd. (supra) question is whether Assessing Officer had prima facie reason to believe that income had escaped assessment. We have earlier noted explanation 2(c)(iv) of Section 147. In our opinion as there was no true disclosure of exact size of plot when new construction commenced it prima facie cannot be said that there were no reasons to believe. information was in annexures and consequently explanation 2(c)(iv) of Section 147 of Act will apply. various judgment relied upon on behalf of petitioner assessee are distinguishable in as much as either there was no failure to disclose full and true relevant information and/or it was merely change of opinion. question is whether petitioners considering size of plot and part of it having already been developed could claim benefit under Section 10-1B(10) of Income-tax Act. issue as to whether size of plot of land has to be considered at time new construction is being put up or whether building already constructed including various deductions like R.G. Area, set back had to be considered in computing size of plot is issue which we do not propose to answer at this stage in exercise of our extra ordinary jurisdiction. petitioner to invoke extra ordinary jurisdiction of this Court must also make out case that no part of relevant material had been kept out from Assessing Officer and/or that it would not be unreasonable for Assessing Officer to draw inference from annexures produced. We, thus, do not find any merit in this appeal. appeal is dismissed accordingly. ..J. [A.K. SIKRI] ...J. [ROHINTON FALI NARIMAN] NEW DELHI; AUGUST 08, 2016. 5 ITEM NO.305 COURT NO.11 SECTION IIIA SUPREME COURT OF INDIA RECORD OF PROCEEDINGS Civil Appeal No(s). 4735/2008 M/S GIRILAL & COMPANY Appellant(s) VERSUS INCOME TAX OFFICER,MUMBAI & ORS. Respondent(s) (With Appln. For permission to file rejoinder affidavit) Date : 08/08/2016 This appeal was called on for hearing today. CORAM : HON'BLE MR. JUSTICE A.K. SIKRI HON'BLE MR. JUSTICE ROHINTON FALI NARIMAN For Appellant(s) Mr. S. Ganesh, Sr. Adv. Mr. Satyen Sethi, Adv. Mr. Arta Trana Panda, Adv. Mr. Rameshwar Prasad Goyal,Adv. For Respondent(s) Mr. Tushar Mehta, ASG Mr. Yashank Adhyaru, Sr. Adv. Mr. Rupesh Kumar, Adv. Ms. Purnima Bhatt, Adv. Ms. Gargi Khanna, Adv. Ms. Anil Katiyar, Adv. UPON hearing counsel Court made following ORDER civil appeal is dismissed in terms of signed order. Application(s) pending, if any, shall stand disposed of accordingly. (Ashwani Thakur) (Tapan Kr. Chakraborty) COURT MASTER COURT MASTER (Signed order is placed on file) M/s. Girilal & Company v. Income-tax Officer, Mumbai & Or