R.Jayasimha Babu, J. - (1.) THE assessee is aggrieved by a notice dated September 8, 2000, issued under Section 148 of the Income-tax Act, 1961, intimating that a part of the income assessable for the year 1999-2000 had escaped assessment within the meaning of Section 147 of the Income-tax Act and calling upon the assessee to file a return in the prescribed form for that assessment year. THE assessee had filed a return for that year on September 30, 1999, for which an intimation under Section 143(1)(a) of the Act had been sent to it on October 15, 1999. In the return it had shown the cost of the construction put up by it as Rs. 92.12 lakhs.
(2.) ON the very day on which the intimation under Section 143(1)(a) of the Act was sent, namely, on October 15, 1999, the Assessing Officer had noticed the discrepancy in the cost of the construction as estimated by the valuer and as noted in the account books of the assessee and had sought a valuation report from the Departmental valuer. The report which was received after a period of several months, indicated the cost of construction as Rs. 168 lakhs. After that report was received the impugned notice was sent. Learned counsel for the assessee submitted that the notice so issued is without jurisdiction and is illegal inasmuch as the assessee had disclosed all the materials along with the return and that the return had been accepted. It was submitted that as on the date when the valuer's report was called for there was no proceeding pending before the Assessing Officer and, therefore, the report that he subsequently obtained on his own, could not give him the jurisdiction to invoke Sections 148 and 147 of the Act and further that report could not constitute a reason for the Assessing Officer to believe that there had been any escapement of income chargeable to tax. Learned counsel relied upon a decision of this court in Fenner (India) Ltd. v. Deputy CIT [2000] 241 ITR 672 to contend that in the absence of any suppression of material by the assessee, the officer could not assert jurisdiction to invoke Section 147 of the Act. That was a case where the notice under Section 148 of the Act had been issued after the expiry of a period of four years and the observations made in that judgment are in that context that the notice could be sustained only if it could have been shown that the assessee had failed to disclose fully and truly all the material facts that could be necessary for assessment. Here, there is no doubt about the fact that the notice under Section 148 has been issued within the period of limitation of four years. Counsel submitted that the intimation acknowledging the return filed by the assessee which intimation was issued under Section 143(1)(a) of the Act is an assessment. Counsel in this context referred to Sections 140, 153, 199 and 219 as also to Section 143 itself and submitted that Section 143 is seen to be found in the Chapter dealing with the procedure for assessment and that Chapter itself is captioned as "assessment". While Section 153 refers to the orders of assessment made, inter alia, under Section 143, Section 199 refers to credit for tax for being deducted at source in the assessment made under this Act for the assessment year for which the income is assessable. Section 140A of the Act was referred to, to point out that self-assessment is accompanied by liability to pay the tax as so self-assessed and it is that tax paid on such self-assessment that is referred to in Section 143(1)(a). Counsel submits that this provision shows that the intimation which the Department is required to send under Section 143(1)(a) was in fact an intimation of an assessment. These submissions were made to lend support to the further submission that after the issue of intimation under Section 143(1)(a) no proceeding would survive before the officer and in the absence of any proceeding he would have no jurisdiction to call for a valuation report.
(3.) COUNSEL for the Revenue submitted that what is done under Section 143(1)(a) is not an assessment, but merely despatch of an intimation acknowledging the filing of the return, and in a case where that intimation indicates any amount as being due towards tax it is given the status of a demand under Section 156. The assessment proper, it was submitted, could only be made under Section 143(3) and until that is done, or an assessment made under Section 147, there is no assessment at all merely by reason of an intimation having been sent under Section 143(1)(a). Reliance was placed by counsel on the case of Mahanagar Telephone Nigam Ltd. v. Chairman, CBDT . In that case it was held that having regard to the changes brought about in Section 143(1)(a) by the Finance Act, 1997, the words "intimation" and "assessment" denote two different concepts. It was noticed that under Section 143(1)(a) no opportunity of being heard is given to the assessee. It was observed by the court that the acknowledgment under Section 143(1) is done mostly by the managerial staff who are not conferred with the power to make any assessment. For the purpose of this case, it is not very material as to whether the intimation sent under Section 143(1)(a) is or is not an assessment. Having regard to the scope of Section 147, a notice under Section 148 can be issued, not only for the purposes of escaped income, but also for the purposes of reassessment of such income and even if an assessment as been made under Section 143(3) that would not have made a difference so far as the power given to the Revenue to assess escaped income is concerned. It may, however, be noticed here that Section 143(4) refers to regular assessment which would seem to indicate that a regular assessment is one which is made after giving opportunity to the assessee and after the records produced have been examined by the Assessing Officer. Such an order is required to be in writing and by implication also signed by the officer making the assessment. ;