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TMI Blog2018 (4) TMI 454X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. - I.T.A. Nos.5767 & 5768/Del/2016, I.T.A. Nos.5347 And 5348/Del/2016 - - - Dated:- 6-4-2018 - SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER For The Assesseet : Shri K.R. Rastogi Shubham Rastogi For The Respondent : Shri S.S. Rana, CIT- DR ORDER PER BENCH I.T.A Nos.5347/Del/2016 and 5767/Del/2016 relate to the assessment year 2008-09 filed by the revenue and the assessee respectively challenging the order dated 28.7.2016 passed by the learned Commissioner of Income-tax(A), Haldwani Delhi {for short ld.CIT(A) ) in Appeal No.191/CIT(A)/HLD/2015-16; whereas ITA Nos. I.T.A Nos.5348/Del/2016 and 5768/Del/2016 relate to the assessment year 2009-10 filed by the assessee and the revenue respectively challenging the order dated 28.7.2016 passed by the ld. CITA) in Appeal No.192/CIT(A)/HLD/2015-16. Since the parties and the question of fact involved in this matter was substantially the same, we deem it just and convenient to pass a common order. 2. Briefly stated facts are that after conclusion of the assessment u/s 143(3) of the Income-tax Act, 1961 (for short the Act ) for respective years, learned AO re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... validity of reopening of proceedings as sustained by the learned CIT(A), the assessee is before us in the other two appeals. 5. It is the argument of the learned AR that the reopening proceedings are bad because in both the years, the AO was aware of the earning of the tax free amount by the assessee and also incurring the administrative expenses which was disallowed for both the years at 0.5% of the average investment. As a matter of fact, for the AY 2008-09, there was a query in this respect which was answered by the assessee and basing on that learned AO disallowed a sum of ₹ 17,16,318/-. And also in that process the assessee brought it to the notice of the learned AO that in respect of Asstt. Year 2009-10, the assessee themselves complied with the requirement of disallowance under Rule 8D of the Rules. Inasmuch as this issue was considered while framing the assessment u/s 143(3) of the Act, it is not open for the learned AO to propose reopening in respect of very same issue without coming into possession of any fresh tangible material. 6. The learned DR placed reliance on the decisions reported in the cases of Greenwell Orchard vs ITO (2017), 82 taxmann.com 461 (Gu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een paid as our Refund amount will become less accordingly. It is prayed that the mistake is unintentional as we are confused with the New Provision brought on Record w.e.f. 24.03.2008. Accordingly it is prayed to kindly do not initiate penalty proceedings. Thanking You, Yours faithfully, ( RAVINDRA SAXENA) Chief Manager, Taxation Place: Nainital Without prejudice to my separate finding on the issue of initiation of penalty the disallowance u/s 14A is computed as under: - As on 1.4.2007 As on 31.3.2008 MF 1,40,000/- 4,63,087/- Tax Free bonds 42,970/- 40,470/- Total 1,82,970/- 5,03,557/- 6,86,527/- Average Investment 687527/2 3,43,264/- Inadmissible exp. u/s 14A @0.5% 17,16,318/- As the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tances, we are of the considered opinion that the entire material is available before the AO when he framed the assessment u/s 143(3) of the Act and being aware of the assessee earning tax free income and incurring some expenditure, the AO accepted the expenditure offered by the assessee under Rule 8D of the Rules, as such, in the absence of any fresh tangible evidence to suggest that the assessee is guilty of not disclosing fully and truly all the material facts necessary for the assessment, it is not open for the AO to reopen the proceedings. Facts are revealed by the assessee and the method is contemplated by the Statute, as such, the assessee not revealing the method of calculation in no way resulted in any income being escaped from assessment. Any reason recorded by the AO on this aspect at a later point of time is only a change of opinion. 11. We are fortified our this conclusion by the decisions of the Hon ble jurisdictional High Court in the case of M/s Sun Pharmaceuticals Industries Ltd., 381 ITR 387 (Del); H.C.L. Technologies Ltd., 397 ITR 469 (Del); decision of Hon ble Gujarat High Court in the case of Kumari Aditi Janmejay Vyas, 89 taxmann.com 336; and the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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