9911796707
TMI Blog2017 (9) TMI 1591X X X X Extracts X X X X X X X X Extracts X X X X ..... n of mind. Further, considering that the assessment took place under Section 143(3) of the Act and a specific query was raised in this regard by the AO, revisiting the same issue on the basis of the same material was not justified. Consequently, the first reason for reopening the assessment appears not to be sustainable in law. Excess depreciation was claimed by the Petitioner @ 15% in respect of the electrical installation instead of at the eligible rate of 10% - Held that:- AO has failed to indicate the basis for forming reason to believe that income has escaped assessment. This appears to be based on mere change of opinion. As is the case with the first reason, Explanation 2(c)(iv) to Section 147 would not come to the aid of the AO un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice dated 31st March, 2014 issued by the Respondent, Deputy Commissioner of Income Tax, Circle-1 (hereafter Assessing Officer - AO ) under Section 148 of the Income Tax Act, 1961 ( Act ) seeking to reopen the assessment in the Assessment Year ( AY ) 2009-10 as well as the consequential order dated 11th January 2016, passed by the AO, rejecting the objections filed by the Petitioner to the re-opening of the assessment. 2. While directing notice to be issued in this petition on 29th January 2016, this Court directed that further proceedings pursuant to the impugned notice and order shall remain stayed. That interim order has continued till date. 3. The background facts are that the Petitioner is a subsidiary of Honda Motors Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowed. Similarly excess depreciation of ₹ 6,24,30,536/- claimed @ 15% by the assessee and allowed in the assessment order in respect of electrical installation instead of eligible 10% has caused escapement of income to that extent. The TDS credit has been allowed in excess of ₹ 68,964/- than admissible as per credit reflected in ITD System. Section 43B of the Income Tax Act provides that any sum payable by the assessee as an employer by way of contribution to any provident fund or superannuation fund or gratuity fund or any other fund for the welfare of the employees, a deduction shall be allowed only in computing the income in the previous year in which such sum is actually paid by him. Subsequent to as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot includible in the total income, is to be disallowed. 11. It is seen that, during the course of assessment proceedings, the AO, in the detailed questionnaire issued by the Petitioner, required the Petitioner to furnish details of income which did not form part of the total income. In its reply dated 24th January 2013, the Assessee explained that it had neither earned any exempt income nor incurred any expense to earn the exempt income. It was further pointed out that, in the appeal filed by the Petitioner against the original assessment order dated 22nd March, 2013 for AY 2010-11, the Commissioner of Income Tax (Appeals) [ CIT (A) ] had deleted the disallowance made by the AO on account of Section 14A of the Act. Consequently, it is po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic query was raised in this regard by the AO, revisiting the same issue on the basis of the same material was not justified. Consequently, the first reason for reopening the assessment appears not to be sustainable in law. 14. The second reason is that excess depreciation was claimed by the Petitioner @ 15% in respect of the electrical installation instead of at the eligible rate of 10% and, therefore, excess depreciation ought to be disallowed. Here again, the explanation offered by the Assessee that the electrical installation was part of the plant and machinery and could not operate independent of it was not even adverted to by the AO in the order dated 11th January, 2016 which disposed of the objections. It is argued that the Petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt that should explain the basis for forming reasons to believe that income had escaped assessment. 18. The next reason provided by the AO for reopening the assessment is that the Assessee had claimed expenses of ₹ 1,98,06,804/- on account of payment made to approved gratuity fund related to earlier years whereas, in Form 3CD under Clause 21(i)(a) Annexure-8A, the amount shown on account of actual gratuity paid during the AY in question was ₹ 1,79,53,799/-. It is, accordingly, stated that the excess deduction of ₹ 18,53,005/- should be disallowed. 19. The Petitioner, in its objections, pointed out that the above reason was based on the original income tax return and not the revised return filed by the Petitioner in w ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
