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TMI Blog2015 (5) TMI 899X X X X Extracts X X X X X X X X Extracts X X X X ..... urisdiction to tax any other income in the reassessment order. Thus the CIT (A) is justified in quashing the reassessment proceedings - Decided in favour of assesse. - ITA No.6343/Del./2012 - - - Dated:- 20-4-2015 - Shri George George K And Shri T.S. Kapoor JJ. For the Appellant : Shri Anil Bhalla, CA For the Respondent : Ms. Y. Kakkar, Senior DR ORDER Per George George K., JM : This appeal, at the instance of the revenue, is directed against the order of the CIT (A)-X, New Delhi dated 23.10.2012. The relevant assessment year is 2004-05. 2. The effective grounds raised are as follows :- 1. The Ld. CIT (A) has erred on facts in law in deleting the addition made on account of technical know-how fees amountin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and made no addition. However, the AO issued a show-cause notice on 05.12.2008 stating that assessee had claimed technical know-how fees amounting to ₹ 7,32,48,000/- as revenue expenditure and why said expenses should not be treated as capital expenditure. The reassessment was completed vide order dated 29.12.2008 wherein the technical know-how fees claimed as revenue expenditure was disallowed as capital expenditure. 4. Aggrieved assessee preferred an appeal before the first appellate authority. Before the CIT (A), it was submitted that since the reasons recorded for issuance of notice u/s 148 of the Act was explained and no addition was made, the Assessing Officer ceased to possess jurisdiction u/s 147 to assessee any other inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eted and the ground of appeal is allowed. 5. Since appeal is allowed on legal ground, ground of appeal no.2 is not adjudicated. 5. The revenue being aggrieved is in appeal before us. 6. The ld. DR submitted that the CIT (A) is not justified in following the judgment of Hon ble jurisdictional High Court in the case of Ranbaxy Laboratories Ltd. vs. CIT (supra), since the said judgment has not considered the amendment to the Third Proviso to Section 147 (amendment w.e.f. 1.7.2012 by Finance Act, 2012). It was submitted by the ld. DR that the judgment was rendered prior to the amendment and their Lordships have no occasion to consider the above said amendment. On the other hand, ld. AR reiterated the submissions made before the Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e relevant finding of the Hon ble Bombay High Court, after considering the Explanation 3 to section 147, reads as follows :- 11. Interpreting the provision as it stands and without adding or deducting from the words used by Parliament, it is clear that upon the formation of a reason to believe under Section 147 and following the issuance of a notice under Section 148, the Assessing Officer has the power to assess or reassess the income which he has reason to believe had escaped assessment and also any other income chargeable to tax. The words and also cannot be ignored. The interpretation which the Court places on the provision should not result in diluting the effect of these words or rendering any part of the language used by Parl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to his notice subsequently during the course of the proceedings as having escaped assessment. If the income, the escapement of which was the basis of the formation of the reason to believe is not assessed or reassessed, it would not be open to the Assessing Officer to independently assess only that income which comes to his notice subsequently in the course of the proceedings under the section as having escaped assessment. If upon the issuance of a notice under Section 148(2), the Assessing Officer accepts the objections of the assessee and does not assess or reassess the income which was the basis of the notice, it would not be open to him to assess income under some other issue independently. Parliament when it enacted the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue. To understand the contention of the ld. DR. The Third Proviso, as it stands now, is reproduced below : Provided [also] that the Assessing Officer may assess or reassess such income, other than the income involving matters which are the subject matter of any appeal, reference or revision, which is chargeable to tax and has escaped assessment. The Third Proviso was inserted by the Finance Act, 2008, w.e.f. 1.4.2008. However, the word also was substituted for the word further by Finance Act, 2012 w.e.f. 1.7.2012. The contention of the ld. DR is that by virtue of the Third Proviso, as it stands now, the AO may now assess or reassess any income irrespective whether the income is not assessed for which the reopening has been init ..... X X X X Extracts X X X X X X X X Extracts X X X X
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