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TMI Blog2021 (12) TMI 1258X X X X Extracts X X X X X X X X Extracts X X X X ..... hen for identical reasons, reassessment proceedings cannot be initiated unless the rectification proceedings culminate into an order, duly framed as per the provisions of law - there is no evidence brought on record by the Revenue that the proceedings initiated u/s 154 of the Act are concluded or communication to that effect has been sent to the assessee. Therefore, under these circumstances, it cannot be said that the assessment proceedings were completed as the order passed u/s 154 is also an order which can be subjected to appeal and revision and as the proceedings have not been completed on record, it cannot be said that income has escaped assessment. Similar view has been taken by the co-ordinate bench at Mumbai in the case of Jet Speed Audio Pvt Ltd [ 2012 (8) TMI 332 - ITAT, MUMBAI] and Yasmin Texturing Pvt Ltd I [ 2012 (5) TMI 724 - ITAT MUMBAI] - Considering the totality of the facts as mentioned elsewhere, notice u/s 148 of the Act is bad in law and deserves to be quashed.- Decided in favour of assessee. - ITA No. 8238/DEL/2019 - - - Dated:- 24-12-2021 - SHRI AAKASH DEEP JAIN, VICE PRESIDENT AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER Assessee By : Shri R.S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case are that the original return of income was filed on 28.11.2014 declaring NIL income. Return was selected for scrutiny assessment and assessment was completed u/s 143(3) of the Income-tax Act, 1961 [hereinafter referred to as 'The Act'] vide order dated 31.03.2016. 5. Subsequently, vide notice dated 31.03.2018, issued u/s 148 of the Act, the Assessing Officer initiated reassessment proceedings. 6. In reply to the notice u/s 148 of the Act, the assessee submitted that the original return filed may be treated as return filed in pursuance to the notice. 7. Reasons for reopening of the assessment read as under: Original return in this case was filed on 28/11/2014 which was processed u/s 143(1) of the Income Tax Act, 1961. The assessment of the assessee company was completed u/s 143(3) of the Income Tax Act on 31/03/2016 determining a income of Rs. Nil/- against the returned income of Rs. Nil/-. 1. It was found that the assessee debited ₹ 1,12,54,637/- as provision for bad doubtful debts to his profit loss account which was added back while computing income of under normal provision of the IT Act. But while computing the income under special pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncurred for earning such income and quantify the disallowance u/s 14A r.w.r 8D of the Rules was asked by the Assessing Officer. 9. A detailed reply was filed by the assessee, which reads as under: In this context we are submitting following details:- 1. Point no 4, details of bank account maintained by the assessee along with Blank Reconciliation statement is enclosed as per Annexure-I. 2. Point no 11, details of advances received is enclosed as per Annexure- II. 3. Point no 12, details of loans and an advance given along with remarks on charging of interest thereon is enclosed herewith as Annexure-III 4. Point no 15. detail note on manufacturing process of electricity through windmills is as below: Basically Windmill converts Kinetic Energy into Electrical Energy Process:- When air collides with the Rotor Blades it rotates in the same direction as of the air, this energy is Kinetic Energy. Now when the rotor rotates the inner mechanism i.e energy conversion takes place in Nacelle; the nacelle is situated at the top of the tower the nacelle has specification of Gear box, Shaft, Yaw Gear etc. The air goes through all this parts for further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ROC Return is enclosed as per Annexure-VIII. 17. With reference to your query regarding large deduction claimed under Chapter-VI- A and high profit shown by the undertaking claiming deduction under section 80IA, we would like to inform you that during the relevant year the company has income from power generation business only. There is a deduction under section 80IA on the profit earned from power generation business. As the assessee company is having income only from the business on which Chapter VI-A deduction is available hence there is no question of claiming large deduction by showing high profit. The chartered accountant certificate in form no 10CCB is enclosed herewith for your information and perusal. 10. We further find that vide notice dated 14.06.2016, the Assessing Officer proposed to rectify the mistake apparent from record u/s 154 of the Act and the same reads as under: The assessment order u/s 143(3) of the Income Tax. Act, 1961 for the assessment year 2014-15 made on 31.03.2016 requires to be amended as there is a mistake apparent from the record within the meaning of Section 154/155 of the Income tax Act, 1961. The rectification of the mistake, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me is to be reduced from the Book Profit while computing the MAT liability. In our case there is no exempt Income earned during the relevant year and hence no addition and deduction has been made from the Book Profit while computing the MAT liability. Further both the above issues has been examined thoroughly while completing the assessment proceedings hence it is requested to drop the rectification proceedings initiated u/s 154 of the Income tax act. 1961 against the assessee company. We may accordingly request your goodself that rectification proceedings u/s 154 in respect of both issues may kindly be dropped. 12. The above facts show that before issuing notice u/s 148 of the Act, the Assessing Officer had already initiated rectification proceedings u/s 154 of the Act and the assessee had furnished detailed reply as mentioned elsewhere. We find that no rectification order has been framed by the Assessing Officer u/s 154 of the Act and yet, for the same reasons, reassessment proceedings were initiated. 13. In our considered opinion, once rectification proceedings have been initiated, then for identical reasons, reassessment proceedings cannot be initiated unles ..... X X X X Extracts X X X X X X X X Extracts X X X X
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