2011 (6) TMI 395 - ITAT CHENNAI

MAT - Site restoration expenditure - treatment of allowance while computing the book profits u/s 115JB - assessee is a company incorporated in USA and which has established project office in India - assessee had entered into a Production Sharing Contract ('PSC') with the Government of India along with ONGC and others for exploration, development and production of oil and gas in the east coast of India - Held that:- It is found that site restoration expenditure is a claim in line with Article 12 of the PSC, the same is clearly an ascertained liability and not a contingent liability. Therefore, it is an allowable expenditure when computing the book profit u/s 115JB - Decided in favor of assessee

Treatment of depletion while computing the total depreciation loss u/s 115JB - Held that:- As it is noticed that the decision in the case of Enron Oil & Gas India Ltd. (2008 - TMI - 30581 - SUPREME COURT - Income Tax), has not been considered by any of the lower authorities and has also not been verified by the lower authorities that the claim of depletion by the assessee is in fact depreciation to the fixed asset representing exploration and development expenditure, we are of the view that this issue is liable to be restored to the file of the Assessing Officer for re-adjudication and we do so - Decided in favor of assessee for statistical purposes.

Re-opening of the assessment u/s 148 beyond the period of 4 years from relevant AY - assessee contended change of opinion by Revenue - Held that:- Original assessments were made u/s 143(1) and as it is noticed that the Assessing Officer has recorded his reasons for reopening of the assessment, in view of the decision in the case of Rajesh Jhaveri Stock Brokers (P.) Ltd. (2007 - TMI - 6563 - SUPREME Court - Income Tax), we are of the view that the re-opening for the assessment year 2002-03 is valid - Decided in favor of Revenue

Validity of Revisionary powers u/s 263 - AY 05-06 - Held that:-It is noticed that the assessment order passed by the AO does not discuss any of the issues which have been raised by the DIT in his SCN u/s 263 or his order passed u/s 263. In these circumstances, in view of the decision of the in the case of Malabar Industrial Co. Ltd. (2000 - TMI - 5786 - SUPREME Court - Income Tax), we find no error in the invocation of the revisionary powers u/s 263 - Decided in favor of Revenue