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TMI Blog2021 (12) TMI 1183X X X X Extracts X X X X X X X X Extracts X X X X ..... of 4 years from the end of the relevant assessment year 2012-13 is bad and not tenable in the eye of law in view of non-fulfilment of criteria under the first proviso to Section 147 of the Act and in view of the fact that there was no omission or failure on the part of the petitioner in disclosing fully and truly all relevant material facts necessary in course of scrutiny assessment under Section 143 of the Income Tax Act, 1961? (ii) Whether on the facts and in the circumstances of the case invoking of the provision of Section 147 read with Section 148 of the Act by the Assessing Officer on the self-same material which were very much available to the Assessing Officer at the time of scrutiny assessment under Section 143 (3) of the Income Tax Act, 1961, is justified by taking a view different from his predecessor who had allowed to tax the non-compete fees in question as "Long Term Capital Gain" in scrutiny assessment and by taking a view that the same should be treated as income from business under Section 28 (V-A) of the Income Tax Act, 1961 instead of "Long Term Capital Gain"? (iii) Whether on the facts and in the circumstances of the case the respondent assessing Officer is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-compete fees in question was treated as "Capital Gain". A rectification petition under Section 154 of the Act was filed by the petitioner before the Assessing Officer requesting him to correct the taxation of Long Term Capital Gain of Rs. 411.69 Crores from the sale of shares of Andhra Pradesh Paper at the rate of 20% instead of 10% as provided in Section 12 of the Act and on 16th April, 2015 order on the aforesaid rectification application order was passed by correcting computational error accordingly. The respondent Assessing officer issued impugned notice under Section 148 of the Act on 29th March, 2019 relating to the relevant assessment year 2012-13 admittedly after expiry of 4 years from the end of relevant assessment year on the ground of escapement of income chargeable to tax on the noncompete fees in question by contending that it was taxable as business income under Section 28 (V-A) of the Act instead of income under the head "capital gain" and recorded reason was furnished to the petitioner on 19th June, 2019 to which the petitioner had made an objection on 19th September, 2019 which was rejected by the respondent Assessing Officer by his order dated 19th Septembe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer from time to time in course of regular assessment under Section 143 (3) of the Act. Invoking of Section 147 of the Act for the purpose of charging the tax under a different heading on the self-same material and the documents which were already available and considered during the course of regular assessment by the Assessing Officer is nothing but a mere change of opinion and the contention of the Assessing Officer that the materials upon which it wants to rely was the information received from the investigating wing subsequent to the regular assessment, is nothing new and it is the same material which were already available at the time of regular assessment and were considered. It also appears from the order of rejection of the petitioner's objection to the impugned notice under Section 148 of the Act that the Assessing Officer himself has not referred or discussed at all or reiterated about his stand of reliance on the information received from the office of the investigating wing in his recorded reason and the Assessing Officer in this regard is totally silent in its order of rejection of the objection of the petitioner against the impugned notice under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e development and human resource development, on which it has declared income separately. However, a bare perusal of notice dated 09.03.2004 which was issued in the original assessment proceedings under Section 143 makes it clear that the point on which the re-assessment proceedings were initiated, was well considered in the original proceedings. In fact, the very basis of issuing the show cause notice dated 09.03.2004 was that the assessee was not maintaining any separate books of account for the said two categories and the details filed do not reveal proportional allocation of common expenses be made to these categories. Even the said show cause notice suggested how proportional allocation should be done. All these things leads to an unavoidable conclusion that the question as to how and to what extent deduction should be allowed under Section 10A of the IT Act was well considered in the original assessment proceedings itself. Hence, initiation of the re-assessment proceedings under Section 147 by issuing a notice under Section 148 merely because of the fact that now the Assessing Officer is of the view that the deduction under Section 10A was allowed in excess, was based on noth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 28 (V-A) of the Income Tax Act, 1961 instead of Long Term Capital Gain. (iii) In the facts and in the circumstances of the case the respondent assessing authority is legally not justified in reopening the assessment in question under Section 147 of the Income Tax Act, 1961 by ignoring the fact that non-compete fees in question had already been treated and taxed as capital gains by the Assessing Officer during the scrutiny assessment proceedings under Section 143 (3) of the Act by accepting the claim of the petitioner after examining, verifying and scrutinising all the facts, relevant documents, details and particulars which were requisitioned by the assessing officer in course of scrutiny assessment and which are matters of records. (iv) In the facts and in the circumstances of the case reopening of assessment by invoking Section 147 and issuance of notice under Section 148 of the Income Tax Act, 1961, after expiry of 4 years from the end of relevant assessment year on the basis of information received from investigation wing which are nothing new and are the same material which were already available before the Assessing Officer and were considered at the time of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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