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TMI Blog2022 (6) TMI 960X X X X Extracts X X X X X X X X Extracts X X X X ..... there is not even a whisper as to what was not disclosed. This is not a case where the assessment is sought to be reopened on the reasonable belief that income had escaped assessment on account of failure of assessee to disclose truly and fully all material facts that were necessary for computation of income but this is a case wherein the assessment sought to be reopened on account of change of opinion of the Assessing Officer about the manner of computation of income. The same is not permissible, in view of proviso to Section 147. - Decided in favour of assessee. - WRIT PETITION NO. 1467 OF 2022 - - - Dated:- 14-6-2022 - NITIN JAMDAR N.R. BORKAR, JJ. Mr. Dharan Gandhi for the Petitioner. Mr. Akhileshwar Sharma a/w. Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eafter on 26 March 2021 issued impugned notice under Section 148 of the Act stating therein that he has reason to believe that the Petitioner s income chargeable to tax for A.Y. 2014-15 has escaped assessment within the meaning of Section 147 of the Act. 7. According to the Petitioner on 18 November 2021, the Respondent No.1 issued notice under Section 143(2) of the Act and along with the said notice, provided the Reasons recorded for reopening the assessment. The Petitioner on 2 December 2021 submitted its objections to the proposed reassessment. The Respondent No.4, thereafter, by impugned order dated 25 January 2022 rejected the objections of the Petitioner. 8. We have heard Mr. Gandhi, the learned Counsel for the Petitioner and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the proviso and the record would clearly show that the entire issue with respect to sales and advertisement expenditure was duly scrutinized in the original proceedings. 12. It is further submitted that, in the reasons for reopening reliance has been placed on Circular No. 5/2012 dated 1 August 2012 issued by the Central Board of Direct Taxes which was very much in existence when original assessment order was passed and therefore, it cannot be considered as new tangible materials. It is submitted that even otherwise the said Circular is not applicable as the Petitioner has not given any freebies to the Doctors governed by the Indian Medical Council, but has given items for business promotion to the veterinary Doctors governed by Vete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from taking any Gift, Travel facility, Hospitality, Cash or monetary grant from the pharmaceutical and allied health sector industries. Section 37(1) of Income Tax Act provides for deduction of any revenue expenditure (other than those falling under sections 30 to 36) from the business Income if such expense is laid out/expended wholly or exclusively for the purpose of business or profession. However, the explanation appended to this subsection denies claim of any such expense, if the same has been incurred for a purpose which is either an offence or prohibited by law. Thus, the claim of any expense incurred in providing abovementioned or similar freebees in violation of the provisions of Indian Medical Council (Professional Conduct, E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see has e-filed the audited P L Account and Balance Sheet or other details/schedules, the requisite material facts as noted above in the reasons for reopening were embedded in such a manner that material evidence could not be discover by the AO and could not have been discovered with due diligence. For the above reasons, it is not a case of change of opinion. Therefore, I am satisfied that the assessee had failed to disclose fully and truly all material facts necessary for its assessment for the assessment year under consideration. 4. In view of the above, it is a fit case for initiation of proceedings u/s. 147 of Income Tax Act, 1961, in order to frame proper assessment to bring to tax appropriate income attributable to the above, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondents based on the available financial information of Petitioner Assessee recorded reasons, obtained necessary satisfaction / sanction u/s. 151 of the act and issued the present notice dated 26.03.2021 u/s. 148 of the act thus the inferences drawn by the Petitioner Assessee in these paragraphs that the proceedings conducted pursuant to present notice dated 26.03.2021 are illegal and bad in law is/are untenable. I crave leave to refer and rely upon the true import of these proceedings at the time of hearing. 16. It is evident from the affidavit-in-reply that the Assessing Officer had all material facts before him when he made the original assessment. Apart from it, specific query in respect of expenditure in question was raised a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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