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TMI Blog2013 (12) TMI 1318X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO was required to apply the law correctly on the material facts available for assessment - When all materials were disclosed on the basis of which the assessment under Section 143 (3) was completed, and the revised return was treated as non-est, as it was beyond limitation - It could be taken as information only if the AO could form the opinion that the material facts were not placed on record and that the revised return contains those facts which are sufficient to form an opinion that the income had escaped assessment; or that the assessee had understated the income, or claimed excessive loss, deductions, allowance or relief in the return or on any of such grounds under Explanation-2 - Decided against Revenue. - Income Tax Appeal No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome for the purpose of calculation. The income was disclosed as Rs. 8, 45, 42, 046/-, though the depreciation was not mentioned in the profit and loss account. The net profit was shown at Rs. 7, 81, 95, 412/-. 4. The respondent-assessee claimed deduction @ 30% under Section 80IA of the Act on the net profit, as increased by the depreciation in the computation of income. The assessment was completed under Section 143 (3) on 31.3.2000 on the income of Rs. 4, 31, 50, 065/- after deduction under Section 80 HHC was reduced from Rs. 92, 44, 415/- to Rs. 78, 84, 859/-, after applying the depreciation on profit, against the claim made on the profit as enhanced by the depreciation amount. 5. A revised return was filed by the respondent-assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale proceeds of advance import licence from the turnover as the same were shown separately under the head "other income" in Schedule 14, in the profit and loss account and was not included in the figures of sales shown in the profit and loss account. 8. In the appeal filed by the assessee the Income Tax Appellate Tribunal observed that the assessee has given the details of 'other income' in the schedules annexed to the profit and loss account. The AO should have considered these details while considering the assessee's claim under Section 80HHC and 80IA. The AO applied his mind and had actually reduced the assessee's claim under both the sections in the regular assessment, and therefore, it was a case of remissness, or omission on the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y his mind to the issue of deductions under Section 80HHC and 80IA. It was not a case of mere change of opinion. The excessive allowance had been computed. Thus the requirements of Explanation-2 (c) of Section 147 was fulfilled. The assessee did not fully and truly disclose all material facts necessary for assessment. The assessee himself deducted the various incomes for arriving at the correct computation of the allowances under Section 80HHC and 80IA either in the computation of income sheet or elsewhere in the return of income. 11. Shri Dhananjai Awasthi submits that Explanation-1 to Section 147 lays down that production of evidence from which material evidence could have been discovered with diligence by the A.O., will not necessarily ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 117 ITR 733 (All) in support of his submission. 14. We have considered the submissions. The assessee had filed along with his return, a tax audit report with balance sheet, and profit loss account, along with a schedule. The schedules are integral part of the financial statement. When the assessee had clearly given the details of the 'other income' in the schedules, which were considered by the AO in completing the assessment on 31.3.2000 under Section 143 (3), he could not have ignored them even if he proceeded under Section 147 on the basis of the revised return and completed the assessment on 4.7.2002 under Section 148 of the Act. 15. The AO had treated the revised return under Section 139 (5) as non-est. He thus could not have pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ite the fact that the respondent-assessee had clearly disclosed under the head "other income" various items of income, which were mentioned in Explanation (baa). The Tribunal correctly found that in such case it was a case of remissness on the part of AO or wrong application of law to the primary facts available on record. The assessee had disclosed the material facts and there was no dispute regarding the nature and quantum of other income. When the material facts were available on record, the AO was required to apply the law correctly on the material facts available for assessment. In the circumstances, it could not be said that the particulars were not disclosed and were found subsequently by the AO, to justify the assessment under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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