9911796707
TMI Blog2011 (9) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 - - - Dated:- 5-9-2011 - J.P. Devadhar, K.K. Tated, JJ. Mr.Suresh Kumar for the appellant. Mr.J.D. Mistri, Senior Advocate with Mr.Rajeev Singh i/by Crawford Bayley Co. for the respondent. JUDGMENT : (Per J.P. Devadhar, J.) 1. Whether the Income Tax Appellate Tribunal was justified in holding that the reopening of the assessment in the case of the assessee for assessment year 200102 was invalid is the question raised in this appeal. 2. The assessee who is a nonresident, had filed its return of income on 22nd October 2001 declaring income of Rs.138.96 crores. The assessment order under Section 143(3) of the Income Tax Act, 1961 ( Act for short) was passed on 25th March 2004, assessing the income at Rs.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that in the present case, cost of acquisition will be the cost at which the assets were required and no indexation is to be allowed separately. 2. The said long term capital gain of Rs.1,42,85,91,065/was taxed @ 10% as per provisions to section 112(1). However, as per the provisions of section 112(1)(c)(ii), the amount of incometax calculated on such long term capital gains should be at the rate of twenty percent, except as provided in the proviso below section 112. The provisions of section 112(1)(c)(ii) are reproduced herein under for reference : Tax on longterm capital gains :112 (1) Where the total income of an assessee includes any income arising from the transfer of a longterm capital asset, which is chargeable under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany) or a foreign company, ( i) the amount of incometax payable on the total income as reduced by the amount of such longterm capital gains, had the total income as so reduced been its total income; and (ii) the amount of incometax calculated on such longterm capital gains at the rate of twenty per cent ; (d) ................ Provided, that where the tax payable in respect of any income arising from the transfer of a longterm capital asset, being listed securities or unit or zero coupon bond, exceeds ten per cent of the amount of capital gains before giving effect to the provisions of the second proviso to section 48, then, such excess shall be ignored for the purpose of computing the tax payable by the assessee. 7. Thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the categories specified in the proviso to Section 112, the reopening of the assessment cannot be said to be valid in law. 9. The argument of the learned counsel for the Revenue was that the proviso to Section 112(1) refers to the second proviso to Section 48 and the second proviso to Section 48 is not applicable to a nonresident and, therefore, in the original assessment the proviso to Section 112(1) could not be invoked in the case of the assessee. We see no merit in the above contention, because, that was not the ground on which the assessment was sought to be reopened. The validity of the reopening of the assessment has to be judged on the basis of the reasons recorded for reopening of the assessment. If the reasons recorded do ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
