9911796707
TMI Blog2016 (7) TMI 1671X X X X Extracts X X X X X X X X Extracts X X X X ..... sis that there is no evidence to show that the assessee has furnished all the necessary details, including bills and vouchers for purchase of the equipments or their specification or technical expert reports, etc. during the course of the original assessment proceedings, so that the A.O. forming a view that the assets under reference may not qualify to be computers, cannot be entirely faulted. We cannot agree. No sound reason with the A.O., but merely a reason to suspect that the assessee s claim may not be correct. Two, the assessee had furnished all the details as were called for during the original proceedings, including details of computer based equipments. There is nothing to show that these details were not true or correct in any respect, much less material. Thirdly, the assessing authority forming a view on the basis of the material not found incorrect or untrue, is nevertheless a view, so that it becomes a case of review. Rather, as it appears, the A.O. s action is guided by the consideration of being consistent in-as-much as like claim was not accepted by the Revenue for the immediately preceding year, i.e., A.Y. 2004-05. That by itself cannot be a ground for reopening. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee on computer based editing equipments. The A.O. issued notice u/s. 154 of the Act in September, 2008, in response to which the assessee submitted relevant details along with the documents on 18.9.2008. The assessee further submitted explanation and broachers pertaining to the computer based assets on 12.12.2008. Subsequently, a remand notice from A.O. was also sent u/s. 154 of the Act on 04.8.2010. However, no order u/s. 154 was passed. Subsequently, a notice u/s. 148 of the Act was issued on 03.5.2011. The reopening was made on the basis of the reason that the assessee has claimed excess depreciation on editing equipments and for this the A.O. recorded the following reasons: Reasons for the belief that income has escaped assessment in the case of M/s. Prime Focus Ltd. (PAN: AAACP6811B) for A.Y. 2005-06 within the meaning of Section 147 of the Income Tax Act. 1961. The assessee has filed its return of income for Assessment Year 2005-06 on 25/11/2005 declaring total income of Rs.6,66,64,980/ -. The assessment was completed u/s.143(3) of the Income Tax Ad, 1961 on 28.12.2007 determining total income at Rs.7,62,30,130/- On verification of the depreciation statemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re clearly applicable as there is failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment. The A.O. framed the reassessment u/s. 143 r/w s. 147 of the Act by allowing depreciation on computer based editing equipments at 25%, as against @ 60% claimed by the assessee treating the same as computer. Aggrieved, the assessee preferred an appeal before the CIT(A), whereby the assessee challenged the reopening also. The CIT(A) however confirmed the action of the A.O. vide para 18 of his appellate order, as under: 18. In the second ground, the assessee has contended that the AO erred in reopening the assessment by issuing of notice u/s.148 of the Act. It has to be noted here that rightly or wrongly, the AO was under the bona fide impression that the assessee is not entitled to claim depreciation at the rate of 60% in respect of editing equipments. He was of the belief that those equipments may be computer-based, but they themselves were not computers. In such a situation, the AO thought it necessary to invoke the provisions of Sec.147 of the Act and to issue a notice u/s.148 of the Act. Such an impression of the AO cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt utilized for making payment. The ld. Counsel further explained that these details, filed before the A.O. were available with him during the course of the original assessment proceedings, and that nothing new has come to light after the assessment. According to him, the assessee had filed all the details, disclosing fully and truly all the material facts relating to the claim of depreciation on computer based editing equipments necessary for its assessment for the relevant year. There was, as such, no failure on the part of the assessee to disclose fully and truly any material facts necessary for its assessment. In view of these facts, it was submitted that the reopening is bad in law. The ld. DR relied on the orders by the Revenue authorities and could not controvert any of the contentions made (with reference to the record) by the ld. AR. 6. We have heard the parties, and perused the material on record. The reassessment in the instant case is clearly beyond a period of four years from the end of the relevant assessment year. We firstly note that the reasons recorded state that the computer is a part comprising the editing equipment and not the whole of it, so th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed the reopening on the basis that there is no evidence to show that the assessee has furnished all the necessary details, including bills and vouchers for purchase of the equipments or their specification or technical expert reports, etc. during the course of the original assessment proceedings, so that the A.O. forming a view that the assets under reference may not qualify to be computers, cannot be entirely faulted. We cannot agree. There is, as afore-stated, firstly, no sound reason with the A.O., but merely a reason to suspect that the assessee s claim may not be correct. Two, the assessee had furnished all the details as were called for during the original proceedings, including details of computer based equipments. There is nothing to show that these details were not true or correct in any respect, much less material. Thirdly, the assessing authority forming a view on the basis of the material not found incorrect or untrue, is nevertheless a view, so that it becomes a case of review. Rather, as it appears, the A.O. s action is guided by the consideration of being consistent in-as-much as like claim was not accepted by the Revenue for the immediately preceding year, i.e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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