Sec. 147 of Income Tax Act, 1961 – Reassessment – Reopening of assessment invalid as there was no information available to the AO specific to A.Y. 1986-87 on the basis of which he could have formed a belief that income has escaped assessment.

Facts: Whether the Tribunal was right in law in upholding the legal validity of the action of the Assessing Officer in initiating reassessment proceedings against the assessee company for the assessment year 1986-87 u/s 147/148 for its alleged income on the basis of the observations/ statements of the Assessing Officer in the note recorded by him under the provisions of sub-sec(2) of Section 148 by way of the reasons for initiating the re-assessment proceedings?

Held, that reasons for reopening the assessment do not make any reference whatsoever to any ‘information’ in possession of the AO that persuaded him to form the belief that for A.Y. 1986-87 income had escaped assessment. The only so-called ‘information’ available with the AO was the assessment order for A.Y. 1987-88. It is not possible for this Court at a distance in time of three decades after the event, to be unmindful of the fact that for A.Y. 1987-88, ultimately, there were no additions made to the income of the Assessee. If that was the only basis for reopening the assessment of A.Y. 1986-87 it would be an entirely futile exercise for this Court to allow the reopening of the assessment for 1986-87 to remain. This Court is satisfied that the jurisdictional requirement of Section 147(b) as stood at the relevant time is not fulfilled. There was no information available to the AO specific to A.Y. 1986-87 on the basis of which he could have formed a belief that income has escaped assessment. Thus, the question is answered in the negative i.e. in favour of the Assessee and against the Revenue – TROPEX PROMOTION AND TRADING LTD. Vs. CIT [2020] 423 ITR 510 (DELHI)