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TMI Blog2022 (5) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal of the Revenue. - I.T.A. Nos. 317/Chny/2019 , 343/Chny/2019 - - - Dated:- 13-4-2022 - Shri V. Durga Rao, Judicial Member And Shri G. Manjunatha, Accountant Member For the Appellant : R. Sivaraman, Advocate For the Respondents : P. Sajit Kumar, JCIT ORDER Per V. Durga Rao, Judicial Member Both the cross appeals filed by the assessee and the Revenue are directed against the order of the ld. Commissioner of Income Tax (Appeals) 2, Chennai dated 26.11.2018 relevant to the assessment year 2013-14. The grounds raised by the assessee are reproduced as under: 1. The order of the CIT(A)-2 in ITA No. 118/2017-18 dated 26.11.2018 is against law and facts of the case. 2. The CIT(A) erred in confirming the proceedings initiated u/s. 147. 3. The CIT(A) erred in not appreciating the fact that the issue of interest payment has been considered in the course of original assessment proceedings u/s. 143(3) and interest of Rs. 39,29,531/- has been disallowed under rule 8D(2)(ii) in the assessment completed u/s. 143(3) on 10.12.2015 and, therefore, the initiation of proceedings u/s. 147 is due to change of opinion. In this connection the appellant rely on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowance under section 14A of the Act furnished by the assessee, the Assessing Officer has noted that the assessee has not included the value of investment in share application money made during the year. When the Assessing Officer pointed out, the AR of the assessee filed objections for making disallowance of proportionate interest with regard to investment in share application money on the following grounds: (a) The investments in share application money will not yield an income till it is converted into shares, whether exempt or not. As there is neither any possibility of earning income nor any right to a benefit is vested till shares are allotted, the provisions of Sec. 14A r.w. Rule 8D will not be attracted. (b) The ITAT 'D' Bench, Chennai considered similar points in our group cases and in their common order in ITA No. 1523/Mds/2012 and ITA No. 1524/Mds/2012 dated 17/12/2012 allowed the appeals in favour of our group cases. (c) The decision of Hon'ble ITAT, Mumbai Bench in the case of Rainy Investments P. Ltd. 30 taxmann.com 169 (2013) is also applicable to our case. 2.1. After considering the submissions of the assessee, the Assessing Officer has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s letter dated 08.03.2017, the Assessing Officer completed the assessment under section 143(3) r.w.s. 147 of the Act after making addition. 3. The assessee carried the matter in appeal before the ld. CIT(A) and challenged the reopening of assessment under section 147 of the Act. After considering the submissions of the assessee and by following the decision in the case of K. Somasundaram Bros v. CIT 238 ITR 939 (Mad), the ld. CIT(A) decided the reopening of assessment under section 147 of the Act against the assessee and directed the Assessing Officer to recompute the disallowance under section 36(1)(iii) of the Act at 17.58% of the actual interest received and after reducing the disallowance, if any, made under section 14A r.w. Rule 8D. 4. On being aggrieved, the assessee is in appeal before the Tribunal challenging the reopening of assessment under section 147 of the Act and submitted that during the course of original assessment proceedings under section 143(3) of the Act, the Assessing Officer has examined all the details and made disallowance under section 14A r.w. Rule 8D. Again, reopening of the assessment under section 147 of the Act for the same reasoning is not va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no tangible material available on record with the Assessing Officer after passing original assessment order under section 143(3) of the Act dated 10.12.2015. Moreover, on perusal of the rebuttal communicated by the Assessing Officer in his letter dated 08.03.2017, we find that the Assessing Officer assumed the power of review of the assessment already completed under section 143(3) of the Act, which is not permissible under the Act. 6.2. In the case of CIT v. Kelvinator of India Ltd. [2010] 320 ITR 561 (SC), the Hon'ble Supreme Court has observed and held as under: 6. On going through the changes, quoted above, made to Section 147 of the Act, we find that, prior to Direct Tax Laws (Amendment) Act, 1987, reopening could be done under above two conditions and fulfilment of the said conditions alone conferred jurisdiction on the Assessing Officer to make a back assessment, but in section 147 of the Act [with effect from 1st April, 1989], they are given a go-by and only one condition has remained, viz., that where the Assessing Officer has reason to believe that income has escaped assessment, confers jurisdiction to re- open the assessment. Therefore, post-1st April, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Amending Act, 1989, has again amended section 147 to reintroduce the expression 'has reason to believe' in place of the words 'for reasons to be recorded by him in writing, is of the opinion'. Other provisions of the new section 147, however, remain the same. For the afore-stated reasons, we see no merit in these civil appeals filed by the Department, hence, dismissed with no order as to costs. 6.3. Similarly, by following the decision in the case of CIT v. Kelvinator of India Ltd. (supra), the Hon'ble Bombay High Court in a Writ Petition No. 1917 of 2019 dated 21.08.2019 in the case of Marico Ltd. v. ACIT, the Hon'ble Bombay High Court has observed and held as under: 4. Mr. Pardiwala, learned Senior Advocate appearing in support of the Petition submits as under:-(a) Although the impugned notice for reopening has been issued within a period of four years from the end of Assessment Year i.e. 2014-15, yet the jurisdiction to reopen an assessment cannot be exercised on account of change of opinion. It is submitted that jurisdiction to re-open an assessment is not a jurisdiction to review an order as held by the Apex Court in CIT v. Kelvinator ..... 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