9911796707
TMI Blog2024 (9) TMI 862X X X X Extracts X X X X X X X X Extracts X X X X ..... fore,we are of the considered view that if, there is no new tangible material or fresh information in the possession of AO, then if ld.AO assume jurisdiction u/s 147 of the Act it would be nullity and all consequential proceedings pursuant to section 147 is liable to be set aside. Also just before reopening of original assessment, an appeal affect order was given by AO pursuant to order of CIT. The revenue had chance to invoke there issues u/s 263 of the Act but failed to raised these issues in proceedings u/s 263 of the Act. Thus, reopening proceedings set aside - Decided in favour of assessee. - Hon ble Shri Manoj Kumar Aggarwal, AM And Hon ble Shri Manu Kumar Giri, JM For the Assessee : Shri. C. Naresh, C.A. For the Department : Shri. A. Sasikumar, IRS, CIT ORDER PER MANU KUMAR GIRI (JUDICIAL MEMBER) These cross appeals are arising out of the order dated 29.12.2017 of the Commissioner of Income Tax (Appeals)-5, Chennai (in short the ld. CIT(A) ). The assessment was framed by the DCIT, LTU-II, Chennai for the assessment year 2010-11 u/s. 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter the Act ), vide order dated 31.03.2016. 2. The assessee in ITA No. 775/Chny/2018 ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed and income was assessed at Rs. 1539,05,88,938/-. 20.09.2013 Order of CIT(A). 27.05.2014 Appeal affect order given by AO pursuant to order of CIT(A) dated 20.09.2013. Income was re-computed to Rs. 785,59,02,266/-. 12.02.2015 Order u/s 263 of the Act by the CIT. 13.02.2015 Appeal affect order given by AO pursuant to order of CIT dated 12.02.2015. Income was assessed at Rs. 760,36,40,367/-. 30.03.2015 Notice u/s 148 was issued. Case was reopened. 29.04.2015 Return filed pursuant to notice u/s 148 of the Act. 16.04.2015 Assessee requested for reasons for reopening assessment. 06.05.2015 Assessee filed objections / written submissions. 22.09.2015 Notice u/s 143(2) was issued. 15.10.2015 Reasons for reopening provided to assessee. 04.01.2016 Objections to reopening the case was disposed of. 31.03.2016 Order u/s 143(3) r.w.s.147 of the Act passed by AO. Computed assessed income as Rs. 1060,48,70,585/-. Following additions are made: (i) Disallowance of credit entries in the Nastro Accounts; (ii) Claim of amortisation of investments written off; (iii) Taxability of amount received under Agricultural Debt Waiver and Debt Relief Scheme. 29.12.2017 Impugned order passed by CIT(A) upholdi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment could be treated as revenue expense. 3 The assessee had received Rs136.44 crores (371.97-235.53) from Government of India under agricultural debt waiver and Debt Relief Scheme 2008 as second instalment during the year. This is required to be brought to tax. (The portion of debt which was already claimed and allowed as bad debt.) It is brought to notice, in the case of rural advances, the assessee could write off the bad debts without crediting the debits or without closing the debtors account in the assessee's Book. Such amount is required to be verified and same received from RBI/GOI should be brought to tax. 4. While computing the disallowance u/s. 14A only investment from which the income is received during the year alone taken as investments which is not correct. Similarly, the interest paid in total was not taken. This resulted in short disallowance under Sec 144. In view of the above, I have reason to believe that income chargeable to tax has escaped assessment and accordingly, the assessment needs to be reopened u/s 147 of the Income tax Act. 9. We may refer relevant portion of the judgment of the Hon ble Supreme Court of India in the case of Kelvinator of India Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade by the Amending Act, 1989, to reintroduce the expression `reason to believe' in Section 147.--A number of representations were received against the omission of the words `reason to believe' from Section 147 and their substitution by the `opinion' of the Assessing Officer. It was pointed out that the meaning of the expression, `reason to believe' had been explained in a number of court rulings in the past and was well settled and its omission from section 147 would give arbitrary powers to the Assessing Officer to reopen past assessments on mere change of opinion. To allay these fears, the 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. 10. Gainfully, we may also refer relevant portion of the order of co-ordinate bench of Tribunal in Assessee s own case in ITA No.782/Chny/2001 and ITA No.1991/Chny/2002 dated 15. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e had disclosed full details of its claim in respect of interest accrued but not due in the computation of income furnished along with the return of income. The whole basis of reopening was the aforesaid computation along with notes thereon as furnished by the assessee along with the return of income. In other words, there was no new tangible material before Ld. AO to reopen the case of the assessee and the reopening was based on existing material already available on record. In such a case, the reopening would become mere review of the order which is impermissible as per the decision of Hon ble Supreme Court in CIT V/s Kelvinator of India Ltd. (320 ITR 561). We are of the opinion that the formation of belief has to be on the basis of some fresh tangible material or new information which is not the case here. This being so, reassessment proceedings are liable to be quashed on legal grounds. 9. The aforesaid conclusion also find support from the decision of Hon ble High Court of Madras in Tanmac India V/s DCIT (78 Taxmann.com 155) wherein reassessment was held to be not justified since the same was sought to be initiated on the basis of return of income and enclosures thereto which ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
