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TMI Blog2014 (4) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.O. in initiating reassessment proceeding 147 of the I. T. Act, 1961, is unjust, arbitrary and unlawful and consequently deciding the issue in favour of the assessee. 3. On the facts and circumstances of the case, the Ld. CIT(A) has erred in law and on facts in deleting ht addition of Rs.,2,87,27,105/- made by the A.O. on account of 'Provision for Unfinished Work'." 2. As regards the first issue, the facts indicated in para 3.1 of the order of Ld. CIT(A) are as under: "During the assessment proceedings, it came to the notice that he assessee has made provision for unfinished work amounting to Rs.2,84,356,379/- & as per "Notes of Accounts" attached to the auditor reports and this provision had been made on estimated basis. The provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch date as also the costs to be incurred thereafter for completion of the project, on its part, in terms of the requirement of Govt. Authorities and he terms of offer made to the prospective owners form part of the project cost which has been taken on the basis of evaluation made by technical experts. The company has also mentioned in the same schedule under the heading Notes to accounts vide Par No. B 9 that there are certain expenses to be incurred on unfinished work to complete projects amounting to Rs.2,88,53,538.69 as on 31.03.2003. This amount is part of the provisions shown in the Balance Sheet. The assessment u/s 143(3) was completed by the A.O. after examining all these information in this regard. These expenses were claimed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) "Where, on consideration of material on record, one view is conclusively taken by A.O., it would not be open to him to reopen assessment based on very same material taking another view and in such a case it could not be held that assessee failed to disclose fully and truly all material facts so as to justify reopening of assessment after expiry of four years from relevant assessment year (assessment year 2002-03). ii) In the case of Mihir Textiles ltd. Vs Jt. CIT 2010 Tax LR 417 (Guj.) the court has observed that; Where admittedly audited books of account like profit and loss account, completed u/s 143(3), it could not be held that there was non-disclosure of primary facts so as to justify reassessment after expiry of four years from r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts so as to justify reassessment after expiry of four years form relevant assessment year (assessment years 1997- 98, 1998-99). vi) Similar view has been expressed by the High Court in the following decisions: i. Inducto Ispat Alloys Ltd. Vs ACIT (OSD) (2010) 320 ITR 458 (Guj.). ii. CIT Vs Goetze (India) Ltd. (2010) 321 ITR 431 / 229 CTR 167 (Delhi). 3.4 In this case, the assessee had disclosed ht details of provision made by its. Therefore, relying on the above decisions and facts of the case the first ground is decided in favour of the assessee." 5. Aggrieved by this order of Ld. CIT(A), the Department has come up in appeal and while relying upon the pleas raised in the grounds of appeal; it was pleaded for setting aside the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and the A.O. passed the order on 21.02.2006 u/s 143(3) of the Act and since the reasons recorded for reopening of the assessment, the A.O. did not comply with the requirement that there was failure on the part of the assessee to fully and truly disclose all material facts necessary for the assessment for that year, which makes to initiate the reassessment proceedings to be bad in law. So, relying upon various case law as submitted before Ld. CIT(A), further reliance was placed on the following case law:- i) CIT Vs Living Media India Ld. 2013 TIOL 413 H.C. DEL-IT ii) Northern Exim (P) Ltd. Vs DCIT, (2013) 357 ITR (Del.) 586 iii) Newsoft Cop (I) Pvt. Ltd. DCIT (2013) 357 ITR (Del.) 510 iv) Select Vocations (P) Ltd. 2013-TIOL-619-H.C.-DE ..... X X X X Extracts X X X X X X X X Extracts X X X X
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