2013 (6) TMI 758 - AT - Income Tax

Summary

Issues involved:
The issues involved in this case are the claim of deduction u/s 80IB (10) of the Income Tax Act, 1961 and the validity of re-opening of the assessment u/s 147.

Department's Appeal:
The Department's appeal challenges the order opposing the claim of deduction u/s 80IB (10) and questions the ownership of the land for the deduction. It argues that the land is not in the name of the assessee firm, thus rendering them ineligible for the deduction. The Department also contends that the assessment order passed by the Assessing Officer is bad in law due to the invalidity of the assessment proceedings for the year.

Cross Objection by Assessee:
The Assessee's cross objection asserts that the re-opening of the assessment is only a change of opinion and not based on new findings. It argues that the original assessment was completed after thorough consideration of all conditions for claiming the deduction u/s 80-IB(10). The Assessee maintains that the re-assessment was initiated without any fresh information or evidence, amounting to an abuse of provisions. The Assessee cites legal precedents to support their position.

Judgment:
The Appellate Tribunal found that the original assessment was completed u/s 143(3) after due consideration of all relevant facts, and the deduction u/s 80-IB(10) was allowed to the Assessee. The Tribunal noted that the re-opening of the assessment lacked new information or evidence to support the claim of income escapement. It was determined that the re-assessment was merely a change of opinion, not a valid reason for re-opening u/s 147. Citing legal precedents, the Tribunal allowed the Assessee's Cross Objection, declaring the assessment order passed by the Assessing Officer as invalid in law due to the re-assessment proceedings' invalidity. Consequently, the Department's appeal became infructuous for adjudication.

Conclusion:
The Cross Objection by the Assessee was allowed, deeming the assessment order as legally flawed due to the re-assessment's invalidity. As a result, the Department's appeal was not decided as it became irrelevant for further consideration.