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TMI Blog2015 (10) TMI 2809X X X X Extracts X X X X X X X X Extracts X X X X ..... as not sustainable. For AY 2006-07 depreciation was claimed on goodwill which is not as per section 32(ii) of the Act - From the Fixed Assets Schedule filed by the ld. AR, he has clearly demonstrated that the goodwill was wrongly capitalized instead of clubbing the sales tax liability with the cost of plant machinery. We do not find any escapement of income to the revenue as the depreciation will be same when calculated on the revised plant machinery cost. AO has completed original assessment after making due enquiry and proper application of mind on the issues on which assessment was reopened. Even otherwise, the AO relied on the assessee s explanation on the issue vide letter No. TCPL/15/08, dtd. Nil, which was very much available on record before AO while completing the assessment u/s 143(3) on 19/12/2008. Hence, no new evidence has come to the notice of the AO. Hence, in our view, reopening in the present case was on change of opinion after passing of the assessment order. We dismiss the revenue appeal for this year also. - Decided in favour of assessee. - ITA Nos. 184 & 185/Hyd/2015 - - - Dated:- 30-10-2015 - Smt. P. Madhavi Devi, Accountant Member And Shri Rif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duction under the provisions of IT Act to the seller, claiming depreciation allowance on the same amount is not in order. 4. In response to notice u/s 148, the assessee filed its return of income on 11-03-2011 declaring the same loss as per the original return filed on 29-10-2005. Further, the assessee, vide letter dated 11-03-2011, requested for supply of the reasons for re-opening of the assessment. The reasons for re-opening of the assessment were communicated to the assessee vide letter dated 29-03-2011. Subsequently, notice u/s 143(2) dated 01-12-2011 was issued and served on the assessee. Assessee has objected to the reopening of assessment as the same was against the provisions of section 147 as the assessment was reopened after completion of four years from the relevant AY i.e. AY 2005-06. AO completed the assessment by making addition of ₹ 1,37,60,167 on account of depreciation claimed on goodwill. 5. Aggrieved by the order of AO, assessee has preferred appeal before the ld. CIT(A). 6. Before ld. CIT(A), assessee submitted that reopening of the assessment made by AO was bad in law for the AY 2005-06 as the same was reopened after expiry of four years from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income on 28/10/2005 and AO completed the assessment u/s 143(3) on 26/10/2007. The AO reopened the case by issuing notice u/s 148 on 25/02/2011. As per the first proviso to section 147, the AO can reopen the assessment after expiry of four years from the end of the relevant AY where the assessee is in default in filing of its return of income u/s 139 or failed to respond to notices u/s 142(1), 148 or failed to fully and truly disclose all information necessary to complete the assessment of its income. In the present case, AO could have reopened the assessment by the end of AY 2009-10. But, in fact, the AO has issued notice u/s 148 of the Act on 25/02/2011. Therefore, the AO has sought to reopen the assessment after the period of limitation prescribed u/s 147 of the Act, even though there was no failure of the assessee to disclose fully and truly all material facts necessary for the assessment of its income. The AO has not recorded any finding to such a default committed by the assessee and also assessee was not at fault. Hence, we dismiss the revenue appeal as not sustainable. 10.2 As far as AY 2006-07 is concerned, reopening proceedings are within the period of four years from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndividually. Some matters may require examination of the assessment order or queries raised by the Assessing Officer and answers given by the assessee but in others cases, a deeper scrutiny or examination may be necessary. The stand of the Revenue and the assessee would be relevant. Several aspects including papers filed and submitted with the return and during the original proceedings are relevant and material. Sometimes application of mind and formation of opinion can be ascertained and gathered even when no specific question or query in writing had been raised by the Assessing Officer. The aspects and questions examined during the course of assessment proceedings itself may indicate that the Assessing Officer must have applied his mind on the entry, claim or deduction etc. It may be apparent and obvious to hold that the Assessing Officer would not have gone into the said question or applied his mind. However, this would depend upon the facts and circumstances of each case. 10.3 Moreover, from the Fixed Assets Schedule filed by the ld. AR, he has clearly demonstrated that the goodwill was wrongly capitalized instead of clubbing the sales tax liability with the cost of plant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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