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TMI Blog2017 (5) TMI 196X X X X Extracts X X X X X X X X Extracts X X X X ..... of the case, the Ld. CIT(A) erred in holding that the reopening under section 147 of the Act was bad in law without considering that the assessee has not furnished correct computation of deduction under section 80 HHC of the IT Act." 3. Briefly stated facts are that the assessee for the AY 2004-05 filed its return of income on 28-10-2004. Along with this return of income, the assessee filed auditors certificate in form No. 10CCAC claiming deduction under section 80HHC at Rs. 97,6,022/-. The assessee for claiming this deduction has considered the profits and gains of business of Rs. 324.40 lakhs disclosed in the profit and loss A/c which includes income on account of exchange rate difference amounting to Rs. 2.58 crores and an amount of Rs. 4.47 lakhs on account of other incomes being interest received from bank, insurance claim etc. Original assessment was completed under section 143(3) on 30-11-2006 wherein full deduction was allowed after computing the working of deduction claimed under section 880HHC of the Act. Subsequently, the AO reopening the assessment by recording the following reasons: - "On perusal of assessment order and order giving effect to CIT(A)'s, excess d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A/c /Auditor's Certificate in Form No.1OCCAC filed along with the return of income. In other words, the impugned materials were part and parcel of the record and were fully and truly disclosed by the appellant at the time of original assessment u/s.143(3) and there is no failure on the pad of the appellant in this regard. On having verified the same, the A.O. has allowed the deduction u/s.80HHC as claimed by the appellant at the time of original assessment. It is also pertinent to note that the original assessment was subject matter of appeal before the CIT(A) on certain other grounds and there was no dispute as to the deduction u/s.80HHC that was allowed by the A.O. either at the time of original assessment or appeal proceedings. The deduction sought by the appellant was not disturbed even in the order giving effect to the CIT (A)'s order. In this background, in my considered opinion, there is no new material that was brought on record by the A.O. at present to arrive at a different conclusion. As already noted, there was no failure on the part of the appellant to disclose truly and fully all the relevant facts in this regard. In the above background, the reopening of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which time, the limit of six years from the end of the assessment year was lapsed. Thus, in my considered opinion, (a) the DCIT Cir-9, Surat has no jurisdiction to serve the notice issued by him uls.148 of the Act after 15.12.2010 on the appellant and thus the notice served by him on 31.3.2011 is invalid. (b) There is no notice issued by the jurisdictional AD. i.e. AOIT 16(3), Mumbai u/s.148 of the Act at any time after 15.12.2010 and before 31.3.2011. In other words, on procedural matters, I hold that there is no valid notice u/s.146 that was issued by the A.O. apart from the finding that the A.O. could not have issued any such notice in the given facts and circumstances that it amounts to change of opinion and there being no fresh materials brought on record. Thus, on both the grounds, the assessment made u/s. 143(3) r.w.s.147 of the Act is bad in law and therefore, the assessment is declared as null and void. Accordingly, the assessment is annulled. Aggrieved, against the order of CIT(A) quashing the reassessment on change of opinion Revenue came in appeal before Tribunal. 5. We have heard rival contentions and gone through the facts and circumstances of the case. We find fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment. In case, there being no whisper in the reasons supplied to assessee that income escaped assessment by reason of assessee's failure to make a full and true disclosure of all material facts necessary for assessment, notice under s. 148 of the Act issued beyond four years from the end of relevant assessment year was barred by limitation under proviso to s. 147 of the Act, hence without jurisdiction. If either of these conditions is not fulfilled the notice is without jurisdiction. If the notice issued u/s 148 fails to satisfy either of the conditions, it deserves to be quashed. However, the officers have many time issued notices for reopening the assessments even beyond four years from the end of the assessment year without fulfillment of any of the legal conditions as stipulated in the first proviso to this section. Such an action of the revenue authorities is strictly challenged by the taxpayers at large in the court of law and courts have quashed the notice issued by Revenue authorities or quashed the re-assessment orders. Hon'ble Supreme Court affirmed the judgment of Hon'ble Allahabad High Court in the case Foramer vs. CIT (2001) 247 ITR 436 (All) wherein Hon'ble Allahab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see the law prevailing on the date of issue of the notice under section 148, i.e., 20-11-1998. Admittedly, by that date, the new section 147 has come into force and, hence, in our opinion, it is the new section 147 which will apply to the facts of the present case. In the present case, there was admittedly no failure on the part of the assessee to make a return or to disclose fully and truly all material facts necessary for the assessment. Hence, the proviso to the new section 147 squarely applies, and the impugned notices were barred by limitation mentioned in the proviso. 11. The learned departmental counsel relied on section 153(3)(ii) of the Act and submitted that there was no bar of limitation in view of the said provision. We do not agree. Section 153 relates to passing of an order of assessment and it does not relate to issuing of notice under section 147/148. Moreover, this is not a case where reassessment is sought to be made in consequence of, or to give effect to, any finding or direction contained in the order of the Tribunal in Boudier Christian's case. As already stated above, Boudier Christian's case related to the employees of the company, whereas the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee's own case O.N.G.C.'s (supra), it has been held that the income from the contract between the parties was business income and not fee for technical services. 13. Although we are of the opinion that the law existing on the date of the impugned notice under section 147/148 has to be seen, yet even in the alternative even if we assume that the law prior to the insertion of the new section 147 will apply, even then it will make no difference since even under the original section 147 notice for reassessment could not be given on the mere change of opinion as held in numerous cases of the Supreme Court, some of which have been mentioned above. Since the Tribunal in the appeal relating to the assessee-company had considered the Tribunal's earlier decision in Boudier Christian's case, it will obviously amount to mere change of opinion, and, hence, the notice under section 147/148 would be illegal." 7. In view of the above facts and the judgment of Hon'ble Supreme Court in the case of Foramer France (supra), we confirm the order of CIT(A) quashing the re-assessment proceedings. Accordingly, Revenue's appeal is dismissed. 8. In the result, the appeal of Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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