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2013 (12) TMI 426 - HC - Income TaxValidity of assessment u/s 147 - Held that - The issue with regard to deduction u/s 80HHC having been examined by the Higher Authorities cannot be subject matter of review by the lower authorities - The issue with regard to claim of deduction u/s 80 HHC which has been dealt with by the ld. CIT by issuing notice u/s 263 was dropped after considering AO s report - Considering this report and the legal position there is no reason to disallow any portion of the deduction allowed u/s 80HHC of the Income Tax Act, 1961, for all the three years under consideration - As the issue has already been examined and held in favour of the assessee by that ld. CIT - The AO has no jurisdiction to reopen the assessment u/s 147, so as to circumvent the order of the CIT which has become final - No new facts came to the notice of the AO other than the facts known to the Department while initiating the proceedings u/s 263 - Decided against Revenue.
Issues:
Challenging assessment order under Section 147 read with Section 143 (3) of the Income Tax Act, 1961; Legality of re-opening proceedings under Section 147 after Section 263 order; Permissibility of re-opening assessment based on same reasons as Section 263 proceedings. Analysis: The judgment pertains to an appeal under Section 260-A of the Income Tax Act, 1961, against a common order passed by the Income Tax Appellate Tribunal. The respondent had challenged the assessment order passed under Section 147 read with Section 143 (3) of the Act. The main contention was the legality of re-opening proceedings under Section 147 after an order under Section 263 of the Act. The respondent argued that since the issue had been examined and decided by higher authorities, it was impermissible for the Assessing Officer (AO) to re-open the assessment. The Tribunal, after considering the findings of the Commissioner of Income Tax (Appeal) and the legal position, held that re-opening the assessment on the same grounds as the Section 263 proceedings was not justified. The Tribunal cited precedents and observed that the AO lacked jurisdiction to re-open the assessment to circumvent final orders of higher authorities. The Tribunal highlighted that the issue regarding the claim of deduction under Section 80 HHC had already been examined and decided in favor of the assessee by the Commissioner of Income Tax under Section 263. The Tribunal emphasized that re-opening the assessment based on the same reasons as the Section 263 proceedings, without any new material or reasonable belief of income escaping assessment, was impermissible. The Tribunal referred to legal precedents and the Supreme Court's judgment to support its decision that the initiation of proceedings under Section 147 had no merit. Consequently, the Tribunal found no grounds or substantial questions of law to interfere with its order and dismissed the appeals. In conclusion, the judgment establishes the principle that re-opening assessment proceedings under Section 147 on the same grounds as earlier proceedings under Section 263, without new material or reasonable belief of income escaping assessment, is not permissible. The Tribunal's decision was based on legal precedents and the clear position of law, as supported by the Supreme Court's judgment. The dismissal of the appeals was justified based on the lack of merit in re-opening the assessment under Section 147 in the absence of valid reasons or new material.
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