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TMI Blog2012 (2) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... uant to the notice issued under Section 148 of the Income Tax Act, 1961 ( the Act‟, for short). A prayer is also made for the issue of a writ in the nature of mandamus or an order prohibiting the respondent, who is the Income Tax Officer, Ward 17(2), New Delhi, from framing the re-assessment order under Section 147 of the Act. 2. The petitioner-company is engaged in the business of maintenance of properties. It filed a return of income on 30.11.2002 declaring a loss of Rs.74,90,450/-. The return was accompanied by the Tax Audit Report and audited financial statements. In the return of income, the petitioner claimed depreciation of Rs.74,85,196/- on fixed assets. The Assessing Officer issued a questionnaire on 05.10.2004 under Section 143(2) of the Act and called upon the petitioner to furnish the details of the new assets acquired during the relevant accounting year amounting to Rs.5,98,81,568/- along with copy of the bills and also to furnish the details of working of depreciation of Rs.74,85,196/- as claimed in the return. He also required the petitioner to furnish the details about the items with bill number, bill date, cost, date on which the asset was put to use and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vatika Greenfield Pvt. Ltd. In order to justify that the building First India Place was fully operational in the year under consideration, copy of Balance sheet of M/s. Vatika Greenfield (P) Ltd. for the Ass. Year 2002-03 is being enclosed herewith marked as Annexure-6. With regard to your assumption that no business activity has been carried out by the assessee during the year and your proposal as to why depreciation claimed be not disallowed, it is submitted that such proposal is entirely on a wrong footing. The assessee company is engaged in the business of management of building and had started the business of managing the said building immediately on acquisition of plant machinery. Although the assessee company has not received any income during the year, it cannot be assumed that the assessee had not started its business; the business of the company was set up as soon as the company was ready to start its business. It had acquired plant machinery and had also entered into an agreement with M/s. Vatika Greenfield Pvt. Ltd. as one of its clients. It had made sufficient arrangements for inflow of income from 1.4.2002 and the company had started giving services to the holders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the petitioner to file a return of income. In response to the notice the petitioner filed a return of income under protest and requested the respondent to furnish a copy of the reasons recorded under Section 148(2) of the Act. The respondent was supplied with the copy of the reasons recorded on 18.03.2009 and they are as follows: - Annexure A Name address of the assessee : M/s. Vatika Space Management P. Ltd. Assessment Year : 2002-03 Status : Company Reasons to issue notice u/s 148 of the I.T. Act. 1961: - Return was filed by the assessee on 31.10.2012 declaring loss of Rs.74,90,450/-. Assessment was made at the returned loss of Rs.74,90,450/- by the then AO under section 143(3) of the Act vide order dated 24.02.2005. It has been noticed that the assessee had claimed deduction of Rs.74,85,196/- on account of depreciation. It is further observed that there was no business activity during the relevant year. As per notes of accounts the company planned to undertake the business and for the purpose had acquired all the assets during the year from its group company which were not put to use by the assessee. Thus, as the business was yet to commence and there was no busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to furnish the details as per questionnaire issued separately under Section 143(2) of the Act. 9. The contention of the learned counsel for the petitioner is that the notice under Section 148 of the Act having been issued after a period of 4 years from the end of the relevant assessment year, it can be upheld only if there is any failure or omission on the part of the petitioner to furnish fully and truly all material facts necessary for its assessment. It is submitted that the petitioner had furnished all the facts in response to the query raised by the respondent in the course of the original assessment proceedings regarding claim of depreciation of Rs.74,85,196/- and that the assessment was completed on that basis under Section 143(3) and that therefore the notice is without jurisdiction. We see merit in the contention. As the reasons recorded for re-opening the assessment show, the ground on which the assessment was re-opened was that the business was yet to commence and, therefore, the depreciation was wrongly claimed by the assessee and allowed in the original assessment. In our opinion, there was no failure on the part of the petitioner to furnish full and true particula ..... X X X X Extracts X X X X X X X X Extracts X X X X
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