Review under the garb of reassessment gets a legislative sanction?

Sanjay Bansal & Amit Parsad – [2022] 136 taxmann.com 241 (Article)

The Income Tax Act is a standing piece of legislation and an on-going statute, which provides the entire machinery for levy of income tax either through the process of assessment and/or reassessment. The Finance Act of each year imposes the obligation for the payment of a determinate sum for each year calculated with reference to that machinery.

The conditions upon the fulfilment of which the reassessment proceedings could be initiated by an Assessing Officer have been changed from time to time with a view to prevent leakage of Revenue.

By the Finance Act, 2021, the condition precedent for the exercise of power of reassessment on the ground of “reason to believe” has been replaced by the expression “information”; and therefore, the question of scope of power of the Assessing Officer as a result thereof, in initiating reassessment proceedings assumes importance and requires deliberation.
At the very outset it would be useful to notice the reassessment provisions under the Income Tax Act, 1961 replacing the said expressions by the Legislature and the interpretation rendered by the Hon’ble Supreme Court in respect thereof.

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