9911796707
TMI Blog2010 (1) TMI 934X X X X Extracts X X X X X X X X Extracts X X X X ..... t be allowed, revenue are dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... .23,09,263/- to its sister concern M/s.Aarti Drugs Ltd. The AO was of the opinion that the assessee is not following any consistent or uniform pattern for making commission payment which ranges from 2 to 5% and some times the commission has been paid at a flat rate on the total amount of sale irrespective of quantum of goods sold. So, the AO disallowed Rs.1 lakh out of Rs.23,09,263/-on an estimate basis treating the same as excessive and unreasonable payment of commission to a sister concern u/s 40A(2) of the IT Act. On appeal, the CIT(Appeals) confirmed the addition. Being aggrieved, assessee is in cross objections. 3(ii) The learned counsel for assessee submitted that all the details with regard to payment of commission have been filed before the AO and the AO, without considering the material filed by the assessee, disallowed Rs.1 lakh on estimate basis. On the other hand, learned Departmental Representative supported the orders of the authorities below. 3(iii) We have heard both sides and perused material on record. We are of the opinion that in the interests of justice, the matter should go back to the AO for fresh adjudication. Therefore, we remit the matter to the AO and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and resulting in short levy of tax of Rs.6.5 lakhs. In response to notice issued by the AO, the assessee explained that the claim made by it is bona fide and invoking of the provisions of section 147 is not warranted. The AO did not agree with the contentions of the assessee. He reopened the assessment and passed re-assessment order. Similarly, for assessment year 2001-02, assessment which was completed u/s 143(3) of the Act, was reopened and re-assessment order passed. 4(ii) The assessee carried the matter in appeal before the CIT(Appeals) before whom it was submitted that the AO has already taken a stand and he cannot invoke re-assessment proceedings to modify his stand which would amount to change of opinion. This is not permissible under the Act. However, the CIT(Appeals) upheld the reopening of assessment by observing that the AO has not considered the issue of allowance of deduction u/s 80HHC and 80IA in the original assessment. 4(iii) Being aggrieved, assessee is in cross objections for assessment years 2000-01 and 2001-02. Learned counsel for assessee submitted that the original assessment was made u/s 143(3) of the Act. The assessee had submitted all the details regar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment is passed in terms of the said sub-s. (3) of s. 143, a presumption can be raised that such an order has been passed on application of mind. It is well known that a presumption can also be raised to the effect that in terms of cl. (e) of s. 114 of the Indian Evidence Act, judicial and official acts have been regularly performed. If it be held that an order which has been passed purportedly without application of mind would itself confer jurisdiction upon the AO to reopen the proceeding without anything further, the same would amount to giving a premium to an authority exercising quasi-judicial function to take benefit of its own wrong." 9. It is clear from the observations made above that the Full Bench of the Delhi High Court has taken a view that in a situation where according to the AO he failed to apply his mind to the relevant material in making the assessment order, he cannot take advantage of his own wrong and reopen the assessment by taking recourse to the provisions of s. 147. We find ourself in respectful agreement with the view taken by the Full Bench of the Delhi High Court. 10. It is further to be seen that the legislature has not conferred power on the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
