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TMI Blog2011 (1) TMI 1370X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, acceptance of the claim in assessment year 2001-02 in a proceeding under section 143(3) on 29.4.2003 cannot be construed as formulation of an opinion by the Assessing Officer in relation to assessment year 2002-03 in the processing done under section 143(1) of the Act dated 28.3.2003. Factually speaking, it is not case of a change of opinion and, therefore, initiation of proceedings under section 147/148 cannot be said to be vitiated on this count. The assessee has to fail - appeal dismissed. - ITA No. 1755, &1205//PN/07 - - - Dated:- 31-1-2011 - SHRI I C SUDHIR, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER For the Appellant : Shri M R Bhagwat For the Respondent : Shri Hemantkumar C Leuva ORDER PER G.S. PANNU, A.M: These two appeals by assessee are directed against the orders of the Commissioner of Income-tax (Appeals)-III, Pune dated 14.9.2007 and 8.6.2007 which, in turn, have arisen from orders dated 8.12.2006 and 31.1.2006 passed by the Assessing Officer under section 143(3) r.w.s.147 of the Incometax Act, 1961 (in short the Act ) pertaining to the assessment year 2002-03 and 2003-04 respectively.. 2. The two captio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der section 80IA independently. The Assessing Officer noted that income from Wind mill activity was included in the Profit and Loss account as other income , which showed that assessee itself was not treating the same as business income. Therefore, no deduction under section 80IA was allowable on such income, because any deduction allowable under section 80IA of the Act is only out of profits and gains derived from an industrial undertaking from any business referred to in sub-section (4) of section 80IA of the Act. Since income from Wind mill activity was disclosed as other income , and not as business income, as per the Assessing Officer, deduction under section 80IA was prima facie inadmissible. Without prejudice to the above, the Assessing Officer observed that even though the assessee s income from Wind mill activity was treated as business income, even then the claim was not in order, because section 80IA requires that profit of the eligible business have to be separately computed and deduction of such profit and gains alone have to be allowed to the assessee. In the instant case, as per the Assessing Officer, the assessee has income from manufacturing activity and also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was totally withdrawn, because the assessee, according to the Assessing Officer, had wrongly claimed deduction under section 80IA of the Act by claiming depreciation pertaining to the Windmill activity against the profits of other manufacturing business of plastic moulding thereby overstating the income from the eligible business of Windmill activity. Denial of such deduction has been further sustained by the Commissioner of Income-tax (Appeals). 4. Before us, the learned Counsel for the assessee vehemently argued that the lower authorities have wrongly denied the claim of the assessee. So, however, the learned Counsel also, quite fairly submitted that at the present stage, the action of the lower authorities is in line with the decision of the Special Bench of the Tribunal in the case of ACIT v. Goldmine Shares Finance (P) Ltd. 113 ITD 209 (SB) (Ahd). However, it is also pointed out that the legal position on the subject is yet not settled and, according to the learned Counsel, the same is in further appeal before the High Courts. He, therefore, contended that though the issue may be decided against the assessee in view of the Special Bench decision of the Tribunal in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r deduction under section 80IA was allowed in principle, subject of-course to a disallowance of 5%. Though the assessment for assessment year 2001-02 was subsequently reopened by way of issuance of notice under section 148 on 20.1.2005 in order to withdraw deduction under section 80IA of the Act, but it is contended by the learned Counsel that on the date of processing of return of the impugned assessment year on 28.3.2003, the Assessing Officer had formulated an opinion that section 80IA claim was allowable to the assessee. As per him, there is an initial acceptance of the assessee s claim of deduction under section 80IA of the Act manifested by the processing done under section 143(1) of the Act on 28.3.2003 for the impugned assessment year and, thus, the subsequent reopening by way of a notice under section 148 of the Act on 30.3.2006 is a change of opinion . 8. The learned Departmental Representative, appearing for the Revenue, has defended the validity of notice under section 148 issued on 30.3.2006 and it is contended that processing under section 143(1) does not reflect formulation of an opinion. It is also pointed out that the reopening has been done in the present cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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