9911796707
TMI Blog2013 (12) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... al bank having its Head Office in France. The assessee has branches in India. The return was filed showing total loss of Rs. 21,61,02,150/-. However, the original assessment was completed at a total loss of Rs. 12,55,47,111/- vide order dtd. 28-3-2005 passed u/s 143(3) of the Income Tax Act, 1961 (the Act). Subsequently, the A.O. on the basis of reasons recorded observed that income in this case had escaped assessment, issued notice u/s 148 of the Act dtd. 28-3-2008 requiring the assessee to file its return of income. In response, the assesse filed return of income on 1-4-2008 declaring a loss of Rs. 19,79,99,882/-. The A.O. on the request of the assessee issued reasons for re-opening of the case. Subsequently, the A.O. issued notice u/s 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in the circumstances of the case and in law, the ld. CIT(Appeals) erred in holding that both the condition for re-opening have not been fulfilled as there was no omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for the assessment in view of the fact that:- (a) In the reasons for re-opening the assessment, the Assessing Officer mentioned very clearly that there had been excess allowance of the bad debts deduction to the extent of Rs. 2.3 crores on account of the failure to adjust the credit balance in the account u/s 36(1)(viia)(b) of the Act by the assessee and that (b) The book profit u/s 115JB should have been computed at Rs. 12.3 crores which was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 36(2), applies, can be allowed only if the assessee has debited amount of such bad debts to the provision for bad and doubtful debt account. Further, the deduction on account of bad debts shall be reduced by the amount of credit balance in the provision for bad and doubtful debts account. In the case of assessee for the year under consideration, assessment u/s.143(3) was made vide order dated 28/03/2005. While computing taxable income, assessee was allowed a deduction of Rs. 18,357/- crores towards bad debts. However, credit balance lying in the bad and doubtful debts account in the beginning of the year amounting to Rs.2.30 crore was not reduced. In view of provisions of clause (vii) of section 36(1) and clause (v) of se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al assessment proceeding the assessee has disclosed all the material facts including the amount of bad debts written off in the chart of computation of total income along with note, statement of computation of income u/s 115JB of the Act, audit report u/s 115JB computing the book profit of the company in Form No. 29-B appearing at pages 3, 6, 8 to 11 respectively of the assessee's paper book. We further find that on the query raised by the A.O., the assessee has also filed its explanation vide letter dtd. 27-01-2005 wherein the assessee in Item No. 5 has explained the provision of bad debts written off along with Annexure 5 appearing at pages 15 to 19 of the assessee's paper book. We further find that the assessee has further explained the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reopening the assessment did not state that the deduction under section 54E was not considered in the assessment proceedings. In fact from the reasons, it appeared that all facts were available on record and, according to the Revenue, the deduction was only erroneously granted. This was a clear case of review of an order. The application of law or interpretation of a statute leading to a particular conclusion cannot lead to a conclusion that tax has escaped assessment for this would then certainly amount to review of an order which is not permitted unless so specified in a statute. The order disposing of the petitioner's objections to initiation of proceedings under section 147 also proceeded on the view that there had been nonapplication o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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