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Issues involved: Initiation of reassessment proceedings u/s 147 of the Income Tax Act.
Summary: The appeals by the Revenue for the Assessment Year 2000-01 & 2001-02 were disposed of by a common order of Ld. CIT(A)- XXIX, New Delhi due to a common issue. The first issue for consideration was the initiation of reassessment proceedings u/s 147 of the Act. The assessments for the mentioned years were made initially on 07.03.2005, and the A.O. reinitiated assessment proceedings on 26.03.2007. The A.O. assessed royalty at 30% in the reassessment proceedings, which was challenged by the assessee. Before the CIT(A), the assessee challenged the assessment on the grounds of reopening of assessment and on merits. It was argued that the notice issued u/s 148 for both years was barred by limitation, and the A.O. did not mention any failure on the part of the assessee to disclose material facts. The CIT(A) held that the reassessment proceedings were initiated on the same material available on record, amounting to a change of opinion, and therefore, were barred by limitation and without jurisdiction. The Tribunal observed that the material for the reassessment was available and considered during the original assessment. As there was no specific recording of failure to disclose material facts by the assessee, the assessments made in 2007 were deemed bad in law. The Tribunal agreed with the CIT(A) and dismissed the Revenue's appeal for both years. In conclusion, the Tribunal upheld the decision of the CIT(A) to cancel the assessments for the mentioned years.
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