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2020 (7) TMI 252 - KARNATAKA HIGH COURTRevision u/s 263 - Reopening of assessment u/s 147 dropped - exemption u/s 11 - non recording any reasons by recording its own reasons for the first time in its order presuming the reasons on which the AO would have passed an order - HELD THAT:- From perusal of the proceeding, it is evident that the assessee was called upon to furnish certain details as well as documents on 28.10.2004 and 06.01.2005, which were supplied by the assessee on 18.02.2005. The Deputy Director, Income Tax (Exemptions) on 23.02.2005 confirmed that the assessee’s consolidation of accounts was done at Mumbai and assessment was completed. After examining the submissions, made by the assessee, the proceeding under Section 147 of the Act were dropped. Director of Income Tax (Exemptions) in its order has found that the assessee for the Assessment year 1997-98 had disclosed an opening balance as corpus fund. The finding recorded by the Director of Income Tax (Exemptions) that the proceedings were dropped without proper enquiry and appreciation, cannot be sustained as from perusal of the record, it is evident that an enquiry was conducted and confirmation was sought from Deputy Director, Income Tax (Exemptions), Mumbai who confirmed that consolidation was done at Mumbai and assessment was completed and exemption under Section 11 of the Act was granted. The fact that assessee was sending accounts to Mumbai is recorded in the order under Section 263 passed by the Director of Income Tax (Exemptions), Mumbai. Accounts were being submitted along with ISKON, Mumbai. The Director of Income Tax (Exemptions) has not found anything wrong in the accounts for the Assessment year 1997-98. It is pertinent to mention here that view taken by the assessing officer is one of the two plausible views and therefore, in view of law laid down in the case of MALABAR INDUSTRIAL CO. LTD [2000 (2) TMI 10 - SUPREME COURT] the proceeding under Section 263 of the Act cannot be upheld. The tribunal has therefore, rightly set aside the proceeding under Section 263 of the Act initiated against the assessee.
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