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TMI Blog2019 (10) TMI 916X X X X Extracts X X X X X X X X Extracts X X X X ..... rm an opinion that income escaped assessment. Furthermore, there is nothing on record to show that in the original assessment proceedings, the Assessing Officer has raised this issue of taxability of this item and formed an opinion in favour of the assessee. Therefore, it cannot be said that it is case of mere change of opinion as no such opinion was formed in original assessment proceedings. The proposition of law laid down by Hon'ble Supreme Court in the case of CIT vs. Kelvinator of India Ltd [ 2010 (1) TMI 11 - SUPREME COURT] has no application to the facts of the present case. Thus, the ground of appeal No. 2 raised by the assessee stands dismissed. Tax contribution of donation made by Ranstand Holdings, NV, Netherlands to Sornammal Educational Trust, Chennai as part of compensation paid to the assessee for breach of share purchase agreement - HELD THAT:- From the reading of the above clause, it is clear that goodwill is not part and parcel of compensation paid to the assessee and his wife by Ranstand Holdings, NV, Netherlands and it is separate and distinct transaction and voluntary payment. The fact that contribution was approved by the Government of India under Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) ought to have appreciated that addition made in the reassessment has arisen only due to change of opinion and not on account of concealment of any particulars by the Appellant; hence the order is to be quashed as being without jurisdiction. CIT Vs. Kelvinator of India Ltd- 320 ITR 561 (SC). 3. The Commissioner of Income Tax (Appeals) erred in holding/Confirming that the amount received by MI s. Sornammal Education Trust was nothing but the amount received by appellant and his wife for settling the dispute with respect to the sale of shares and compensation received. 3.1 The Commissioner of Income Tax (Appeals) ought to have appreciated that the payment was not part of the consideration paid by Randstad to the promoters but a voluntary payment made to M/s. Sornammal Education Trust as the word used in the goodwill paragraph is a onetime donation to the DISHA. 3.2 The Commissioner of Income Tax (Appeals) ought to have appreciated that in the Letter from Randstad consideration payable for purchase of shares, settlement of dispute and goodwill payment have been separately mentioned and the voluntary donation by Randstad to M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 1776/Mds/2012 for assessment year 2009-2010. 6. While matter stood thus, the Assessing Officer had come to know that M/s. Ranstand Holdings, NV, Netherlands had paid a sum of ₹ 6,40,09,975/- on 1st September, 2008 to Sornammal Educational Trust, Chennai in which assessee is a trustee. According to the Assessing Officer, this payment is actually due to the assessee and his wife Ms. Hemalatha Rajan and formed an opinion that income escaped assessment and issued notice u/s.148 of the Act on 04.04.2013 and it appears that assessee had not responded to the said notice and accordingly, the Assessing Officer had proceeded to frame assessment after furnishing reasons recorded for issuance of reassessment notice. On receipt of the reasons recorded, assessee had filed objections that reassessment proceedings are prompted by mere change of opinion and therefore very initiation of reassessment proceedings is invalid in law. The Assessing Officer rejecting the said argument had proceeded with framing of assessment order u/s.143(3) r.w.s. 148 of the Act vide order dated 20.06.2014, brought to tax the contribution paid to trust as income of appellant a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment of India and there is no income accrued in the hands of the assessee. 10. On the other hand, the ld. Sr. Departmental Representative placed reliance on the orders of lower authorities. 11. We heard the rival submissions and perused the material on record. 12. Grounds No.1 4 are general in nature therefore, does not require any adjudication. 13. Ground of appeal No.2 challenges the very validality of reassessment proceedings. One of the contention advanced on the validality initiation of the reassessment proceedings is that assessment was reopened by mere change of opinion and no new tangible material were brought on record by the Assessing Officer suggesting escapement of income to tax. This issue is to be adjudicated with reference to the reasons recorded by the Assessing Officer by issuance of reassessment notice u/s.148 of the Act. The Assessing Officer had extracted reasons recorded for issue of notice u/s.148 of the Act at para 1 of the assessment order. From the reasons so recorded it is clear that subsequent to the completion of the assessment u/s.143(3) of the Act vide order dated 27.12.2011, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income tax and tax accordingly, assessee replied vide letter dated 19.12.2011. Furthermore, the Assessing Officer had chosen to make addition on account of payment received by the assessee towards compensation for forging the right to sue. These two facts would suggest that MOU was very much part of record of the original assessment proceedings. However, there was no discussion in the assessment order as regards to the contribution of donation by the M/s. Ranstand Holdings, NV, Netherlands to Sornammal Educational Trust, Chennai, in terms of goodwill clause of the MOU. Even though MOU was referred to by the Assessing Officer in the assessment order, there is nothing on record to show that the issue of taxability of contribution of donation was raised and decided in favour of the assessee company. It is settled proposition of law as held by Hon'ble Supreme Court in the cases of Kalyanji Mavji Co vs. CIT, 102 ITR 287 and CIT vs. A. Raman and Co, 67 ITR 11 that to inform means to to impart knowledge and the detail available to the ITO in the papers filed before him does not by its mere availability become an item of information. It is transmuted into an item of informa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isputedly, assessee and his wife are interested in the said trust as a trustees. The donation was paid to the trust in order to create goodwill and change relationship in a positive lights, Randstand is prepared to make a one-time donation of one million to Disha in the event that it can reach quick agreement about the above. The publicity and the link to Randstad s CSR policy will be limited and must be agreed with Frans Cornelis, Managing Director group marketing communications . 15. From the reading of the above clause, it is clear that goodwill is not part and parcel of compensation paid to the assessee and his wife by Ranstand Holdings, NV, Netherlands and it is separate and distinct transaction and voluntary payment. The fact that contribution was approved by the Government of India under Foreign Contribution Act confirming the position. It prima facie proves that it is a voluntary contribution. Further, the mere fact that assessee and his wife are trustees in the trust does not ipso facto prove that they are beneficiaries of this fund nor there is no material on record brought by the Assessing Officer to say that the money was diverted to the trust by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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