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Issues Involved:
The issues involved in this case are the re-opening of assessment u/s.147, addition made u/s.68 of the Income Tax Act, and the validity of the order passed by the Commissioner of Income-tax (Appeals). Re-opening of Assessment u/s.147 and Addition u/s.68: The Appellate Tribunal ITAT Kolkata heard an appeal against the order of the Commissioner of Income-tax (Appeals) for the assessment year 2004-05. The assessee challenged the re-opening of assessment u/s.147 and the addition made u/s.68 of the Income Tax Act. The Assessing Officer had added Rs. 37,20,809 u/s.68, stating that the assessee had shown a liability of Rs. 56,13,106 as interest accrued/payable to a firm, which was not supported by the corresponding firm's Balance Sheet. The Commissioner of Income-tax (Appeals) upheld the addition, deeming it as profits and gains of the business. However, the Appellate Tribunal found that there was no new material or information to justify the re-assessment. Since the facts were available during the original assessment, the re-assessment was deemed a change of opinion and not sustainable in law. Consequently, the Tribunal quashed the orders of the revenue authorities, allowing the appeal of the assessee. Validity of the Order Passed by the Commissioner of Income-tax (Appeals): The Appellate Tribunal considered the arguments presented by the assessee's counsel, emphasizing that re-assessment u/s.147 should be based on new material or information, not a mere change of opinion. It was asserted that the original assessment order, passed under section 143(3) of the Act, implied application of mind by the Assessing Officer. The Tribunal concluded that since no new information had surfaced, the re-assessment amounted to a change of opinion and was unsustainable. Therefore, the Tribunal ruled in favor of the assessee, highlighting the importance of fresh material for re-assessment proceedings and the need for a valid basis beyond a mere reevaluation of existing facts.
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