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TMI Blog2017 (6) TMI 1358X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of negative reserve, which has been shown in report under Form-I (Actuarial Report). After examining the Actuarial Report made the addition of 81,000/-, while passing the order of assessment. The assessment order was passed with due application of mind. The assessing officer has not brought any tangible material on record to show that there was any failure on the part of assessee to disclose fully and truly all material on record necessary for assessment. As per our considered view, it was merely a change of opinion of assessing officer. On merit we have seen that similar issue arose in AY 2005-06 and the assessee filed appeal before Tribunal. The Tribunal on the basis of order of High Court in ICICI Prudential Life Insurance Co [ 2015 (7) TMI 1259 - BOMBAY HIGH COURT] remanded the issue to the file of AO - The AO in pursuance of order of Tribunal deleted the additions on account of negative reserve its order. - Decided against revenue. X X X X Extracts X X X X X X X X Extracts X X X X ..... income chargeable to tax has escaped from assessment. It was further contended that the assessee furnished correct income/loss chargeable to tax and filed all the necessary information at the time of filing the return of income. The assessee attached computation of taxable income, copy of annual account and audited report. Hence, there is no failure on the part of assessee in disclosing fully and truly all material facts necessary for the assessment. The assessee requested to drop the proceeding u/s 147 of the Act. The assessee also contended that the return of income filed on 24.11.2003 be treated as return filed u/s 148 of the Act. The following reasons were recorded and supplied to the assessee: "During the A.Y. 03-04, the assessee has negative reserves of ₹ 1,55,05,500/- This negative reserve has not formed part of the actuarial surplus which is not in order. To that extent, the actuarial surplus has been understated. The assessee not offering the incremental negative reserves as a part of surplus arrived at as per actuarial valuation, for the purpose of computing income from life insurance business, has resulted in income escaping assessment to the tune of ₹ 1,5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rved on 27.03.2010, admittedly after four years of end of AY. There was no failure on the part of assessee to disclose fully and truly while filing the return of income. The assessee furnished complete details and information at the time of furnishing return of income. The AO made complete/detailed enquiry and after satisfaction allowed the negative reserve. The assessee furnished actuarial report Form-I during the assessment proceeding which duly reflected the negative reserve. The AO made the addition of ₹ 81,000/- during the original assessment proceeding on account of actuarial surplus. The negative reserve was a part of the documents furnished during the assessment, thus, it cannot be said that there was non-disclosure of material fact relevant for assessment. The ld. AR of the assessee further argued that while passing the assessment order, the AO referred the actuarial report as on 31.03.2003, furnished by assessee ( para-2 of assessment order dated 21.03.2006 page No. 101 to 103 of PB). The ld. AR of the assessee further has shown us the report under Form-I (Actuarial Report) showing the negative reserve (page 96 of PB). It was argued that re-opening was based on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion issue and in the case of ICICI Prudential Case (supra) on merit of the case. It was argued that the reopening is invalid even otherwise the ground of appeal raised by revenue is covered in favour of assessee. 5. We have considered the rival submission of the parties and have gone through the orders of authorities below. We have seen that during the assessment proceedings the assessee furnished actuarial report Form-I, which shows the negative reserve. The AO made the addition of ₹ 81,000/- during the original assessment proceeding on account of actuarial surplus. The negative reserve was a part of the documents furnished during the assessment. Thus, it cannot be said that there was non-disclosure of material fact relevant for assessment. The assessing officer while passing the assessment order, the AO referred the actuarial report as on 31.03.2003, as reflected in para-2 of assessment order dated 21.03.2006 passed under section 143(3) (page No. 101 to 103 of PB). Thus, it is not the case where the assessing officer has not made inquiry in respect of negative reserve, which has been shown in report under Form-I (Actuarial Report) (page 96 of PB). The assessing officer a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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