2021 (4) TMI 392 - AT - Income Tax

Reopening of assessment u/s 147 - Disallowance of deduction u/s 80IB - hospital building was completed by March 2012 and hence viewed that the assessee has not satisfied the conditions for grant of deduction u/s 80IB(11C) for the Assessment year(AY) 2012-13 - HELD THAT - Reopening of assessment was on the basis of information that was already available on record and no fresh information was received by the AO. Revisiting the same issue which was already considered in original assessment and taken the decision amounts to difference of opinion and on difference of opinion the reopening of assessment is not permissible. AO mentioned in the assessment order that the assessee had claimed deduction u/s 80IB and filed Form No.10CCBC instead of 10CCBD. The Ld.AR submitted that there was no material difference in both the forms with regard to information and columns are the same. The AO in the original assessment did not raise any objection for submission of 10CCBC and there was no difference with regard to information to be furnished in Form 10CCBC or 10CCBD, hence it was purely a mistake or misunderstanding. DR also did not controvert the submission of the assessee with regard to difference of information in 10CCBC or 10CCBD. The AO had accepted the 10CCBC and allowed the deduction in original assessment. This Tribunal in assessee s own case 2017 (6) TMI 1038 - ITAT VISAKHAPATNAM following the order of Sri S.Venkatesh 2013 (6) TMI 715 - ANDHRA PRADESH HIGH COURT held that denying deduction u/s 80IB(11C) on technical issue is unjustified. Hence we, hold that the reopening of assessment is bad in law and accordingly, we quash the notice issued u/s 148 and annul the assessment made u/s 147 r.w.s 143(3) dated 26/12/2017 and allow the appeal of the assessee.

Summary

Issues:
1. Validity of assessment made u/s 148 of the Income Tax Act, 1961.
2. Sustaining the addition by the Ld.CIT(A) relating to disallowance of deduction u/s 80IB(11C) of the Act.
3. Charging of interest of ?3,66,804/- u/s 234B of the Act.

Issue 1: Validity of assessment made u/s 148 of the Income Tax Act, 1961:
The appellant challenged the reopening of assessment under section 148, arguing that all conditions for claiming deduction u/s 80IB(11C) were met during the original assessment. The AO reopened the assessment based on the completion date of the hospital building, claiming non-compliance with deduction conditions. The appellant contended that the building was completed within the specified period and furnished necessary documents. The AO, without receiving fresh information, disallowed the deduction and levied tax. The Tribunal held that the reopening was unjustified as it was based on existing information, amounting to a difference of opinion. Consequently, the notice issued u/s 148 was quashed, and the assessment u/s 147 r.w.s 143(3) was annulled, allowing the appeal.

Issue 2: Sustaining the addition by the Ld.CIT(A) relating to disallowance of deduction u/s 80IB(11C) of the Act:
The AO disallowed the deduction u/s 80IB(11C) in the reopened assessment, alleging non-compliance with conditions. The appellant argued that all requirements were met, and the AO's acceptance in the original assessment supported their claim. The Tribunal found that the AO had previously allowed the deduction after due verification. The reopening lacked fresh information and was deemed a difference of opinion. The Tribunal referred to a previous case where denial of deduction on a technical issue was considered unjustified. Consequently, the Tribunal quashed the reopening and allowed the appeal, setting aside the Ld.CIT(A)'s order.

Issue 3: Charging of interest of ?3,66,804/- u/s 234B of the Act:
The judgment did not provide detailed analysis or discussion regarding the charging of interest under section 234B of the Income Tax Act, 1961. Hence, no specific findings or conclusions were mentioned in relation to this issue in the judgment.

In summary, the Tribunal's decision primarily focused on the validity of the assessment made under section 148 and the disallowance of deduction u/s 80IB(11C). The Tribunal found the reopening of assessment to be unjustified as it was based on existing information, leading to the quashing of the notice issued u/s 148 and the annulment of the assessment u/s 147 r.w.s 143(3). The appellant's appeal was allowed, emphasizing compliance with deduction conditions and the AO's previous acceptance.