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TMI Blog2016 (10) TMI 362X X X X Extracts X X X X X X X X Extracts X X X X ..... ent under section 147 of the Act, namely that the Assessing Officer should have reason to believe that income has escaped assessment is not satisfied. In the circumstances, the assumption of jurisdiction by the Assessing Officer by issuing notice under section 148 of the Act is without jurisdiction and as such the impugned notice under section 148 of the Act as well as all proceedings pursuant thereto cannot be sustained In case of India Gelatine And Chemicals Ltd. V/s. Assistant Commissioner of Income-Tax (No.1) [2015 (2) TMI 808 - GUJARAT HIGH COURT ] noted that loss claimed by the assessee even if was disallowed, there would be no difference in the assessee's tax liability under Section 115JA of the Act. It was therefore, observed tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eopen such assessment, he issued the impugned notice, which as can be seen, was done within a period of 4 years from the end of relevant assessment year. The Assessing Officer had recorded following reasons for issuing the notice : Reasons for reopening of assessment. In this case return of income for the A.Y.2007-08 showing the income of ₹ 533240/- was filed on 15.10.2007 and the assessment was finalized u/s 143(3) vide assessment order dated 22.5.2009. In this regard it is noticed that : (A) The assessee has two units, One in Dehradun which is eligible for deduction u/s 80IC of the Act and another at Rajkot which is not eligible for deduction u/s 80IC of the Act and the assessee has debited ₹ 2557476/- towards Bad de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ws the profit from trading of goods is ₹ 184627/-. The said profit has been added back to the net profit and has been claimed as deduction u/s 80IC of the Act. However the profit from trading of goods is not eligible for deduction u/s 80IC. Therefore the same is required to be treated as taxable income not eligible for deduction u/s 80IC of the Act. In view of the above I have reasons to believe that the income chargeable to tax to the extent above has escaped the assessment within the meaning of sec.147 of the I.T.Act,1961. 2.3 Upon receipt of such notice, the assessee raised objections to the notice of reopening under a letter dated 2.2.2012. Such objections were rejected by the Assessing Officer by an order dated 3.4.2010, u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lacs. In any case therefore, the assessee company would still be governed by the MAT provision contained in Section 115JB of the Act. Learned counsel clarified that looking to the nature of disallowances referred to by the Assessing Officer in the reasons, there would be no corresponding effect on the computation of book profit for the purpose of Section 115JB of the Act. 5. Since this contention was taken at the time of oral hearing, without being previously taken in the pleadings, in our order dated 21.9.2016 we had referred to such contention and accepted the request of the counsel for the revenue to take instruction on these aspects of the matter. Accordingly, the petition was placed for further hearing today. 6. Learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed under section 115JB of the Act. In the circumstances, when the tax payable as per the reasons recorded is less than the tax paid by the petitioner under the assessment framed under section 143(3) of the Act, the question of any income having escaped assessment does not arise. The order recording reasons, itself indicates that in fact no income has escaped assessment and as such there is no basis for the formation of belief that income has escaped assessment. In the circumstances, the basic precondition for reopening assessment under section 147 of the Act, namely that the Assessing Officer should have reason to believe that income has escaped assessment is not satisfied. In the circumstances, the assumption of jurisdiction by the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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