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TMI Blog2007 (10) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... eclaring loss of Rs.73,11,996/-. In the profit and loss account, the assessee had made provision of Rs.2,16,01,248/- for deferred taxation. During the course of the assessment proceedings, the assessing officer called upon the assessee to show cause as to why the provision for deferred taxation amounting to Rs.2,16,01,248/- made in the profit and loss account should not be taken into account for determining the book profit under section 115 JB of the Act. 4. The assessee in its reply submitted that the provision for deferred taxation was made in accordance with the accounting standard 22 and the same cannot be taken into account for determining the book profit, because, the same is not covered by any of the clauses (a) to (f) s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re tax. However book profit under the provisions of section 115JB had been shown at Rs.10,720,671 which was accepted while computing book profits under section115JB. Profit as per profit and loss account was shown at Rs.3,30,74,365 and after allowing brought forward loss / unabsorbed depreciation (which ever is less) of Rs.19,18,244 book profit worked out to Rs.3,11,56,121 as against Rs.95,54,873 disclosed by the assessee, thus resulting in underassessment of book profit by Rs.2,16,01,248 which is on account of provision for deferred tax. As provisions for deferred tax is nothing but provision made for making liabilities other than ascertained liabilities to which provisions of explanations seen of sec. 115JB was applicable. Thus book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the order rejecting the objections are bad in law because concluded assessments can be reopened only if the assessing officer has valid reason to reopen the assessment and not mere change of opinion. In the present case, during the assessment proceedings the very same issue was raised by the assessing officer and the assessment order under section 143(3) of the Act was passed after accepting the explanation given by the petitioner and, therefore, on a mere change of opinion, it is not open to the assessing officer to reopen the concluded assessment. Mr. Pardiwala further submitted that in the absence of any decision to the contrary, the decision of the Income-tax Appellate Tribunal Kolkata Bench in the case of Asst. CIT Balrampur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it has to be increased by the amount of provision for deferred taxation made by the assessee in its profit and loss account was specifically raised by the assessing officer at the time of the assessment under section 143(3) of the Act. The assessee explained that the provision for deferred taxation is made in the profit and loss account as per the accounting standards and, therefore, the book profit arrived at in the profit and loss account cannot be increased by the amount of provision for deferred taxation. Once the explanation given by the assessee is accepted and the regular assessment is made, the said assessment cannot be reopened for considering the very same issue, unless the assessing officer has some material on the basis of which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 115 JB of the Act. In the absence of any decision to the contrary, the assessing officer was bound by the said decision. Therefore, the assessing officer could not ignore the decision of the Kolkata Bench in the case of Balrampur Chini Mills Ltd. [2008] 297 ITR (AT) 15 and continue with reassessment proceedings. 12. No doubt, Explanation 2(c) to section 147 of the Act empowers the assessing officer to reopen an assessment if he has reason to believe that excessive relief has been granted to the assessee under the Act. The belief that the income chargeable to tax has escaped assessment on account of excessive relief must be based on definite basis. As stated earlier, there is no basis for treating the provision for deferred taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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