9911796707
TMI Blog2024 (9) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... case are that the petitioner - company filed its return of income on 27th November 2012 for the Assessment Year 2012-13 declaring total income at Rs. 10,86,70,260/- under the normal provisions of the Act and book profit of Rs. 10,79,13,516/- under Section 115JB of the Act. [4.1] Along with the return of income, the petitioner also filed balance-sheet and profit and loss account. The case of the petitioner was taken up for scrutiny assessment and notices under Section 142 (1) / 143 (2) of the Act were issued which were complied with by the petitioner giving reply in detail. [4.2] During the course of regular assessment, the petitioner filed reply dated 15th February 2016 wherein justification of various expenses amounting to Rs. 30,75,80,968/- framed in the computation of income with documentary evidence was submitted. It was contended that such expenses were claimed as stated in the Audit Report in Form No.3CD and it comprises of depreciation under Section 32 of the Act of Rs. 21,44,61,679/-, claim under Section 43B of the Act of Rs. 27,99,737/- and claim admissible under Section 40a of the Act of Rs. 39,05,807/- as TDS has been paid for the year under consideration and claim adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss arising from depreciation in its value on account of alteration in the rate of exchange would be a trading loss, but if the amount is held as a capital asset, loss arising from depreciation would be a capital loss. In other case of CIT Vs. Dempo & Co Pvt. Ltd (206 ITR 291) which has specifically laid down principles in order m decide whether loss/gain arising out of foreign exchange fluctuations is in nature of revenue or capital of which at para 5 of said principles which says as follows: Loss resulting from depreciation of the foreign currency which utilized or intended to be utilized in business and is part of the circulating capital, would be trading loss but depreciation of fixed capital on account of alteration in exchange rate would be capital loss. As the loans were utilized for acquisition of indigenous assets, such expenses are capital in nature and in view of the above decision of Hon'ble Supreme Court would not be allowable as revenue expenses, Basis of forming reasons to believe and details of escapement of income:- In view of the above facts, I have reasons to believe that the income to the extent of Rs. 1,20,50,206/- and any other income are chargeab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccording to learned advocate Mr. Shah, the impugned notice deserves to be quashed and set aside. [6.3] Learned advocate Mr. Shah further submitted that the foundation of notice by considering Section 43A of the Act itself is erroneous and thereby, the impugned notice deserves to be quashed and set aside. [6.4] By making above submissions, learned advocate Mr. Shah prayed before this Court to allow the present petition by quashing and setting aside the impugned notice and all consequential proceedings. [7] Per contra, learned advocate Mr. Karan Sanghani for the respondent, while supporting the impugned notice, made the following submissions: [7.1] Learned advocate Mr. Sanghani for the respondent submitted that notice under Section 148 of the Act issued by the revenue authority is perfectly justified and being issued after following the due procedure of law and thereby, no illegality can be said to have been committed by the respondent which requires interference by this Court and thereby, he prayed this Court to dismiss the present petition. [7.2] Learned advocate Mr. Sanghani submitted that deduction of foreign exchange loss of Rs. 1,20,50,206/- pertaining to indigenous assets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue in nature. Learned advocate Mr. Sanghani emphatically submitted that the issue of deduction of foreign exchange loss on acquisition of indigenous asset was neither part and parcel of issues involved in order under Section 143 (3) of the Act nor in the office note appended to order under Section 143 (3) of the Act. Under the circumstances, reopening of assessment can be said to be perfectly justified and therefore, present petition deserves to be dismissed. [7.6] Learned advocate Mr. Sanghani lastly submitted that notice under Section 148 of the Act has been issued after taking necessary approval from the Principal Commissioner of Income Tax, Vadodara - 3, Vadodara and sanction was granted after due application of mind and therefore, it cannot be said that notice under Section 148 of the Act was issued in absence of any valid sanction. [7.7] By making above submissions, learned advocate Mr. Sanghani requested this Court to dismiss this petition. [8] Having considered the submissions of the learned advocates appearing for the respective parties and considering the reasons recorded as well as the facts on record, it emerges from the facts of the case that during the regular as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar or to disclose fully and truly all material facts necessary for that assessment year. In the present case, the entire material was available with the Assessing Officer during the original assessment and therefore, there was no failure on part of the assessee to disclose truly and fully all material facts necessary for assessment and based upon such material supplied by the petitioner, the Assessing Officer passed the original assessment order. Further, it appears that the notice for reopening is based upon the audit objection and there is nothing on record to suggest that such reopening is made on account of new tangible material available on record. It is therefore, apparent that there is change of opinion by the Assessing Officer to reopen the assessment for the Assessment Year 2011-2012, more particularly, when the issue raised in the reopening assessment is already considered during the original assessment proceedings. The Assessing Officer cannot have any jurisdiction to issue the notice under section 148 of the Act, 1961 for reopening the assessment for the year under consideration more particularly, when the assessment is sought to be reopened beyond a period of four year ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
