JUDGMENT J.P. Devadhar, J.
1. This petition is filed to challenge the notice dated December 5, 1996, issued under Section 148 of the Income-tax Act, 1961 ("the Act" for short). By the said notice, the Assessing Officer has sought to reopen the assessment for the assessment year 1992-93.
2. The petitioner is a public limited company engaged in the business of investments.
3. For the assessment year 1992-93 the petitioner had filed its return of income and on March 19, 1993, the Assessing Officer had issued an intimation under Section 143(1) of the Act.
4. The reasons recorded for reopening the assessment year 1992-93 read thus:
The return filed for the assessment year 1992-93 was processed under Section 143(1)(a) on March 19, 1993. As mentioned in the order for the assessment year 1993-94 passed under Section 143(3) dated January 31, 1996, it has been held that the actual transfer of shares has taken place in the period relevant for the assessment year 1992-93 and hence capital gains leviable in the assessment year 1992-93. This aspect has been discussed on pages 17 and 18 of the order for the assessment year 1993-94.
As such notice under Section 148 is being issued for the assessment year 1992-93 to bring to tax the capital gains in this year. Issue notice under Section 148 as I have reason to believe that the income chargeable to tax has escaped assessment.
5. Thus, the notice under Section 148 of the Act seeking to reopen the assessment for the assessment year 1992-93 has been issued based on the information contained in the assessment year 1993-94.
6. Mr. Mehta, learned Counsel appearing on behalf of the petitioner submitted that the decision for the assessment year 1993-94 has been challenged by the petitioner and the same is pending before the appellate authority. Therefore, reopening the assessment based on the assessment order for 1993-94 is unwarranted. Mr. Mehta further submitted that the transaction of sale of shares as per the agreement dated January 3, 1992, was in fact concluded during the assessment year 1993-94 and, therefore, capital gains if any arising from the said transaction cannot be taxed in the assessment year 1992-93. Therefore, reopening of the assessment for the assessment year 1992-93 based on the observations contained in the assessment order for the assessment year 1993-94 are wholly unjustified.
7. The limited question required to be considered in this petition is whether the reopening of the assessment for the assessment year 1992-93 is justified or not. Admittedly, in the assessment order for the assessment year 1993-94 the Assessing Officer has held that the sale of shares as per the agreement dated January 3, 1992, took place on January 3, 1992, itself and the capital gains in respect thereof are leviable in the assessment year 1992-93. Admittedly, the issue regarding the capital gains arising from the sale of shares pursuant to the agreement dated January 3, 1992, was neither raised nor discussed in the assessment order for the assessment year 1992-93. It is well established in law that the assessments can be reopened on the basis of the information contained in the assessment for subsequent years. Therefore, reopening the assessment based on the assessment order for the assessment year 1993-94, wherein it is held that the relationship of 100 per cent, holding subsidiary company was acquired with the only intention of evading the capital gains tax cannot be faulted.
8. We make it clear that despite the information contained in the assessment order for the assessment year 1993-94, it will be open to the assessee to place all the materials before the Assessing Officer to establish that the liability to capital gains tax, if any arose in the assessment year 1993-94 and not in the assessment year 1992-93. It will be open to the Assessing Officer to pass appropriate order on the merits after hearing the petitioner. The fact that the assessment order for the assessment year 1993-94 is pending before the appellate authority is wholly irrelevant for the purpose of reopening the assessment. As stated earlier, the information contained in the said assessment order is sufficient to reopen the assessment for the assessment year 1992-93.
9. For the reasons stated hereinabove, we do not find any merit in the petition and the same is hereby dismissed. Rule stands discharged with no order as to costs.
10. The interim relief granted at the time of admission of the petition stands vacated.
11. All contentions of both parties are kept open.