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TMI Blog2019 (8) TMI 409X X X X Extracts X X X X X X X X Extracts X X X X ..... ly annulled the re-assessment proceedings ITAT noted that this was not challenged by the Revenue. It only challenged the deletion of the addition on merits. In the absence of any challenge to the quashing of the re-assessment proceedings by the Revenue, the ITAT found no ground to interfere. Revenue sought to contend that the ITAT adopted the technical view in precluding the Revenue from urging the merits of the issue only because it had not challenged the order of the CIT (A) annulling the re-assessment proceedings. In the considered view of the Court, this is not a mere technical approach . The fact of the matter is that there was no basis for the re-opening of the assessment except the presumptive observation of the Revenue audit whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not specify which limb of Section 271(1) (c) the penalty proceedings had been initiated under i.e. whether for concealment of particulars of income or for furnishing of inaccurate particulars of income. The Karnataka High Court had followed the above judgment in the subsequent order in Commissioner of Income Tax v. SSA s Emerald Meadows [ 2015 (11) TMI 1620 - KARNATAKA HIGH COURT] the appeal against which was dismissed by the Supreme Court of India [ 2016 (8) TMI 1145 - SC ORDER] - No substantial question of law arises. - ITA 475/2019, ITA 426/2019, ITA 427/2019, AND ITA 429/2019 - - - Dated:- 2-8-2019 - S. MURALIDHAR AND TALWANT SINGH JJ. Appellant Through: Mr. Sagar Suri, Standing counsel and Ms. Lakshmi Gurung, Advo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her the ITAT was justified in upholding the order of the Commissioner of Income Tax (Appeals) [ CIT (A) ] accepting the Respondent/Assessee s revised computation of income in terms of Section 44 read with First Schedule to the Act? There are certain other incidental questions urged which will be discussed hereafter. 6. The facts as far as AY 2004-2005 is concerned, are that the Respondent, which is carrying on life insurance business, filed its return of income which was picked up for scrutiny. Initially the assessment was completed by the Assessing Officer (AO) under Section 143 (3) of the Act on 30th November, 2006. Subsequently, after the expiry of four years thereafter, a notice dated 28th March, 2012 was issued under Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eafter Act ), the AO computed the income under the head Business at an assessed loss of ₹ 5,48,20,431/-. 10. Subsequently, the AO claimed to have noted that the Respondent had claimed excessive deductions/allowances. In its appeal against this assessment order before the CIT (A), the Respondent raised an additional ground that its income from the insurance business had to be computed in terms of Section 44 of the Act which was applicable exclusively to income derived from such insurance business. Accordingly, it also furnished a revised computation of loss at ₹ 7,47,31,918/-. This was accepted by the CIT (A) and a direction was issued to the AO to compute the income accordingly. 11. During this second comput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the CIT (A) who upheld the imposition of penalty upon the Assessee under Section 271 (1) (c) of the Act. Against this, the Respondent filed an appeal before the ITAT. 15. The ITAT has in the impugned order noted that for AY 2004-2005 there was no material in possession of the AO other than the observation of the Revenue audit to proceed against the Assessee under Section 147 of the Act. The CIT (A) noted that the case fell squarely within the realm of change of opinion which was impermissible as a basis for re-opening of assessments after a lapse of four years. The CIT (A) expressly annulled the re-assessment proceedings. The ITAT noted that this was not challenged by the Revenue. It only challenged the deletion of the addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of Profit and Gains from life insurance business. These provisions, which begin with non-obstante clauses, override other provisions of the Act. There was no option but to compute income for insurance business in terms thereof. Therefore, the Respondent was justified in filing the revised computation under Section 44 of the Act and claiming this as an additional ground before the CIT (A). In the circumstances, the direction given by the CIT (A) to the AO to compute income in terms of Section 44 of the Act was justified. 20. The Court is unable to find any error having been committed in the ITAT in this regard. No substantial question of law arises on this issue as well. 21. The Respondent had challenged the upholding of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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