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TMI Blog2024 (7) TMI 1471X X X X Extracts X X X X X X X X Extracts X X X X ..... ssary for its assessment. Once this is a fact, this issue is fully covered by the decision of Foramer France [ 2003 (1) TMI 101 - SC ORDER] wherein the Hon ble Supreme Court has affirmed the decision Foramer France [ 2000 (8) TMI 45 - ALLAHABAD HIGH COURT] wherein as held it is the new Section 147 which will apply to the facts of the present case. In the present case, there was admittedly no failure on the part of the assessee to make a return or to disclose fully and truly all material facts necessary for the assessment. Hence, the proviso to the new Section 147 squarely applies, and the impugned notices were barred by limitation. In the absence of any failure on the part of the assessee to disclose fully and truly all material facts and assessment framed u/s. 143(3) of the Act and reopening is beyond 4 years, the issue is squarely covered in favour of the assessee - Shri Mahavir Singh, Vice President And Shri Jagadish, Accountant Member For the Appellant : Shri P. Sajit Kumar, JCIT For the Respondent : Shri Vijay Kumar, CA ORDER PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by the Revenue is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and made additions to the tune of Rs. 1,43,83,139/- under various heads. Aggrieved, assessee preferred appeal before CIT(A). 4. The assessee before CIT(A) raised the issue of assumption of jurisdiction and challenged the reopening of assessment as bad in law and without jurisdiction. The CIT(A)-NFAC adjudicated the ground of reopening and held that reopening is bad in law by observing in para 5.3.4 as under:- 5.3.4 I have carefully perused the recording a reason to believe by the AO which is part of the submissions made by the assessee. There are 5 grounds on the basis of which the reason to believe has been formed. All these grounds have its origin in the documents filed by the assessee along with the return of income or at the time of making replies to the notices issued to the assessee during the original proceedings of regular assessments. In the recorded reason there is no mention of the return having being assessed earlier nor there is any mention that the assessee had with held any information which he ought to have filed along with return of income or in response to notices issued u/s 142(1) at the time of original assessment proceedings which the AO came to know from any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relied on the assessment order and also relied on reasons recorded for reopening of assessment. The ld. Senior DR filed copy of audit objection that audit has raised objections for non-deduction of TDS, payment of loan was claimed as business expenditure, claimed excess advertisement expenses also debited consulting charges, interpretation charges, lab testing charges and reporting charges to the profit loss account in addition to other expenses. In view of this audit objection, the AO recorded the reasons and hence according to ld. Senior DR, the reopening is within the framework of law. 6. On the other hand, the ld.AR for the assessee argued that from the very reason recorded it is clear that the AO has inferred the information from profit loss account and balance sheet i.e., audited accounts of the assessee filed along with return of income for the year ended 31.03.2012. The ld.AR stated that there is no allegation in the reasons recorded that there is any failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment for the relevant assessment year 2012- 13. The ld.AR stated that once there is no reason recorded in term of prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bad and paying it was also bad. Such commission charges paid to doctors was opposed to public policy. The payment of commission/referral charges by the assessee for referring patients to it could not be accepted to be legal or in accordance with the public policy and it requires to be disallowed and brought to tax. (e) The assessee had claimed depreciation allowed of Rs. 3,36,47,707/- to the P L account which includes Rs. 1,50, 78,201/- for the CT machinery @ 40% on the WDV of Rs. 3,76,95,503/-. The CT machinery used by the assessee to conduct various tests in the scan centre and not a life saving device moreover it had not been classified in (xia) life saving medical equipment under the head III machinery and plant in the New Appendix-I, Table of rates at which depreciation was admissible w.e.f AY 2006-07 onwards under the IT Rules. The allowable depreciation was @ 15% and the excess depreciation of Rs. 84, 11,927/- claimed by the assessee required to be disallowed and brought to tax. Hence, I have the reasons to believe that the income of chargeable to tax has escaped assessment for the assessment year 2012-13. In view of the above, the approval for the reopening of the Assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e original Section 147 have been deleted and a new proviso added to Section 147. 17. In Rakesh Aggarwal v. Asst. CIT (1997] 225 ITR 496, the Delhi High Court held that in view of the proviso to Section 147 notice for reassessment under Section 147/148 should only be issued in accordance with the new Section 147, and where the original assessment had been made under Section 143(3) then in view of the proviso to Section 147, the notice under section 148 would be illegal if issued more than four years after the end of the relevant assessment year. The same view was taken by the Gujarat High Court in Shree Tharad Jain Yuvak Mandal v. ITO [2000] 242 ITR 612. 18. In our opinion, we have to see the law prevailing on the date of issue of the notice under Section 148, i.e., November 20, 1998. Admittedly, by that date, the new Section 147 has come into force and, hence, in our opinion, it is the new Section 147 which will apply to the facts of the present case. In the present case, there was admittedly no failure on the part of the assessee to make a return or to disclose fully and truly all material facts necessary for the assessment. Hence, the proviso to the new Section 147 squarely appli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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