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TMI Blog2015 (8) TMI 571X X X X Extracts X X X X X X X X Extracts X X X X ..... ponse to the said notice. 2.1 That thereafter, the respondent has issued the impugned notice dated 13.8.2013 under section 148 of the Act for AY 2010-11 to reassess the total income. That in response to the said notice, the petitioner vide letter dated 16.6.2014 requested the Assessing Officer to treat the original return filed on 15.10.2010 as in response to the impugned notice under section 148 of the Act and also supplied copy of reasons recorded for reassessment. 2.2 That thereafter, the Assessing Officer supplied to the petitioner - assessee copy of reasons recorded. That the petitioner submitted the objections against reopening of the concluded and completed assessment, which came to be disposed of by the Assessing Officer vide communication dated 13.1.2015. At this stage, the petitioner has preferred the present Special Civil Application under Article 226 of the Constitution of India challenging the impugned notice under section 148 of the Act to reopen the completed assessment for AY 2010-11. 2.3 As during the pendendy of the present petition, the Assessing Officer has passed the order of assessment under section 143(3) of the Act read with section 147 of the Act, the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion at 30% is admissible on motor vehicles only if they are used for business of hiring. It is submitted that the petitioner is not engaged in the business of vehicle hiring and therefore, was/is not entitled for depreciation at 30%. It is submitted that therefore, having formed an independent opinion, that an amount of Rs. 3,06,16,999/- (depreciation being restricted to 15% as against 30% as claimed) has escaped assessment, the Assessing Officer has rightly reopened the assessment and has rightly issued notice under section 148 of the Act. 4.2 It is further submitted by Shri Desai, learned advocate appearing on behalf of the revenue that now when the reassessment order is already passed under section 143(3) r/w section 147 of the Act, it is requested not to entertain the present petition and relegate the petitioner to avail the remedy by way of appeal before the learned CIT (Appeals) and if aggrieved, in that case, before the learned Tribunal. 4.3 Relying upon para 6 of the communication by the Assessing Officer to the higher authority while seeking approval to initiate the reassessment proceedings and relying upon the reasons recorded by the Assessing Officer while issuing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome assessed at Rs. 8,47,28,610/-. The assessee firm is engaged in the business of construction and mining contractor. For the AY 2010-11, the assessee firm has claimed depreciation @ 30% on dumpers, lorries etc. amounting to Rs. 6,12,33,988/-, the assessee firm is primarily a contractor and income received is towards civil works executed & from contract works. The higher rate of depreciation @ 30% is admissible on motor vehicles only if they are used for the business of hiring. In other cases, normal rate of depreciation i.e. @ 15% only is allowable. The assessee firm being a contractor and income received is from earthwork and contract income, and is not in business of transportation. The above fact was not brought the course of assessment proceedings, therefore, the assessee has failed to disclose fully and truly all material facts necessary for assessment. Consequently, an amount of Rs. 3,06,16,999/- (depreciation being restricted to 15% as against 30% as claimed) has escaped assessment." 5.1 The aforesaid reopening of the assessment/reassessment proceedings has been challenged mainly on the ground that the reopening of the assessment is solely on the basis of the objection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arty. 5.4 From the file, it appears that thereafter, the Commissioner of Income Tax, Rajkot on 8.8.2013 communicated to the Joint Commissioner of Income Tax, Gandhidham that the audit objection raised are acceptable and therefore, proceedings to reopen the cases under section 147 of the Act may be initiated, in the prescribed manner in view of the CBDT instructions on the matter. From the file, it appears that thereafter, the Deputy Commissioner of Income Tax sent a report in the prescribed proforma to the Commissioner of Income Tax so as to reopen the assessment under section 147 of the Act. Even the proforma report on the draft audit para No.1 LAR 2497, the Deputy Commissioner of Income Tax continued to maintain that audit pointed out are not acceptable, however, the case has been reopened under section 147 of the Act to safeguards of the revenue. Only thereafter, at the instance of the audit objection raised by the audit party and the instruction given by the Commissioner of Income Tax to reopen the assessment for AY 2010-11, the Assessing Officer has issued the notice under section 148 of the Act in the proforma report while not allowing that and/or accepting the audit objectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Court in the case of Adani Exports v. Dy. CIT reported in [1999] 240 ITR 224 (Guj.) and the decision of the Division Bench of this Court in the case of Cadila Healthcare Ltd. v. Asstt. CIT dated 14.12.2011 in Special Civil Application No.15566/2011, it is held that any reassessment proceeding initiated at the instance of the audit party objection without the Assessing Officer himself having reason to believe that the income chargeable to tax has escaped the assessment must fail. Similar view has been taken by the Division Bench of this Court in the case of Raajratna Metal Industries Ltd. (Supra). 5.7 Now, so far as the reliance placed upon the decision of the Hon'ble Supreme Court in the case of P.V.S. Beedies Pvt. Ltd. (Supra) and the decision of the Division Bench of this Court in the case of N.K. Industries Ltd. (Supra) by Shri Desai, learned Advocate appearing on behalf of the Revenue is concerned, it is true that the information given by the audit party and/or on the audit objection, can be used for the purpose of reopening of the assessment. However, for that there must be formation of the opinion by the Assessing Officer and/or Assessing Officer independently has reason t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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