- (1.) THESE three appeals are directed against the judgment of the Tribunal dated March 23, 1999, whereby the Revenue has challenged the decision of the Tribunal on two counts, i.e., whether reopening of the assessment is valid and whether furnishing of bank guarantee by the assessee against customs duty amounts to actual payment of customs duty and is not hit by the provisions of Section 43B of the Income-tax Act, 1961. Since common questions are involved in these three appeals, therefore, we dispose of all these three appeals by this common order.
(2.) THE assessee-respondent imported news prints, on which customs duty was payable. THE assessee-respondent disputed the rate of customs duty before the Supreme Court and made a request for interim ex parte stay order on payment of customs duty. THE Supreme Court vide its order dated April 8, 1982, granted stay on the condition of giving an unqualified and categorical bank guarantee for the amount of customs duty payable by the assessee. In pursuance of the direction of the Supreme Court, the assessee furnished a bank guarantee for the amount in dispute and claimed deduction of that customs duty liability. The Assessing Officer allowed the claim of the asses-see in the original assessment. Thereafter notice under Section 148 for reopening of the assessment under Section 147 of the Income-tax Act, 1961, was issued and after reopening of the assessment for the above mentioned three years, the Assessing Officer disallowed the claim of the assessee for deduction of customs duty liability. The Assessing Officer held that the assessee is not entitled for any deduction in the absence of actual payment of the customs duty as that is hit by the provisions of Section 43B of the Income-tax Act, 1961. In appeal before the Commissioner of Income-tax (Appeals), the Commissioner of Income-tax (Appeals) has confirmed the view taken by the Assessing Officer. In appeal before the Tribunal, the Tribunal took the view that as material facts were disclosed for taxing the customs duty liability, therefore, the Assessing Officer was not justified in reopening of the assessment under Section 147 read with Section 148 of the Income-tax Act, 1961. The Tribunal also took the view that once the assessee has furnished a bank guarantee as per the direction of the Supreme Court, the Assessing Officer should not have disallowed the claim of the assessee, as furnishing of the bank guarantee is tantamount to payment of customs duty. Whether the reopening was bad or illegal, we have to consider the provisions of Section 147 as it stood in the relevant years. The relevant provision of Section 147 of the Income-tax Act, 1961, reads as under : "147. Income escaping assessment.--If the Assessing Officer, has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of Sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in Sections 148 to 153 referred to as the relevant assessment year) : Provided that where an assessment under Sub-section (3) of Section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under Section 139 or in response to a notice issued under Sub-section (1) of Section 142 or Section 148 or to disclose fully and truly all material facts necessary for his assessment for that assessment year."
(3.) LEARNED counsel for the assessee brought to our notice that on a query by the Assessing Officer regarding customs duty liability, the assessee, vide its letter dated December 8, 1986, submitted a reply including the reply regarding customs duty liability, which reads as under : "Customs duty payable : Against newsprint imported, the liability was provided, writ was filed by the company and also by other newspapers in the Supreme Court of India, for relief in rate of duty on newsprint. The Supreme Court has asked the company to submit bank guarantee in favour of the Customs Department for the liability." Similar type of reply was filed for the assessment year 1985-86. Mr. Ranka, learned counsel for the assessee submits that it amounts to furnishing fully and truly material for the purpose of deduction of customs duty liability. Once this fact has been disclosed that the assessee has claimed customs duty liability on the basis of furnishing bank guarantee as per the direction of the Supreme Court and that has been allowed accepting the assessee's claim in the original assessment, in our view to relook the same material and change the opinion, the Assessing Officer cannot reopen the assessment, if the notices have not been issued within four years from the end of the relevant assessment year. In the case in hand for the assessment year 1984-85 notice under Section 148 has been issued on January 19, 1991, and for 1985-86 again notice under Section 148 has been issued on January 17, 1991, i.e., after four years from the end of the relevant assessment year. These facts are not in dispute. ;