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TMI Blog2025 (2) TMI 871X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 37. Petitioner has, however, claimed deductions under Section 35AC. No provision was shown to us based on which we could infer that such a deduction could not, at least prima facie, be claimed. On the contrary, Mr Kamdar referred us to the statement of objects and reasons accompanying the Finance (No. 2) Bill, 2014 by which these amendments were introduced.
In any event, we do not propose to go into the merits of the matter. This Petition must be allowed because there was no tangible fresh material based upon which the AO could have reason to believe that any income had escaped assessment. This is, as noted earlier, a scrutiny case where several queries, including queries particular to this issue, had been raised. The queries were answered by the Petitioners, and upon consideration of all these materials, an assessment order was made u/s 143 (3) of the IT Act.
On the ground that some other view was possible, the AO could not have changed his earlier opinion and, based upon such change of opinion, issued the impugned notice seeking to reopen the assessment. For all these reasons, the impugned notice and the consequential orders will have to be set aside. X X X X Extracts X X X X X X X X Extracts X X X X ..... e context of the issue raised in this Petition: ". Details of deductions under section 80G amounting to Rs. 31,931,237 in respect of donations made during the year is enclosed at Annexure C and hardcopies of donation receipts and 80 G Certificates will be submitted at your office, as the data is large. During the year under assessment, the Company has claimed deduction of Rs. 181,297,969 under sec 35AC of the Act. Copies of Form No.58A for claiming deduction under sec 35AC in respect of payments made to Lupin Human Welfare & Research Foundation ("LHWRF") and People for Animals is enclosed at Annexure D." 9. After assessing the Petitioner's return, an assessment order under Section 143 (3) was made on 28 December 2018, accepting the claims made by the Petitioner inter alia under Section 35AC and deductions under Section 80G of the IT Act. 10. On 31 March 2021, the impugned notice was issued for the reopening of this assessment. Upon the Petitioner's request for reasons for reopening, the same was furnished on 05 August 2021. Those reasons read as follows: - "The assessee has filed the e-return on 23.11.2016 declaring its income at Rs. 2636,01,64,390/- under normal prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by 30 November 2021. Hence the present Petition. 12. From the reasons furnished to the Petitioner, we find that no fresh tangible material could be said to have come to the knowledge of the assessing officer for reopening of the assessment. Admittedly, the Petitioner's case was selected for scrutiny, and several queries were raised. In particular, the queries were raised regarding the claims under Section 35AC and deductions under Section 80G of the IT Act. Upon considering the Petitioner's response, these claims were allowed in the assessment order under Section 143 (3) of the IT Act. 13. Though, this was a case of reopening within 4 years, still, in the absence of any fresh tangible material coming to the knowledge of the assessing officer, reopening of the assessment only on re-examination of the very same material based on which the original assessment order was passed cannot be permitted. In a similar fact situation, the coordinate bench in Castrol India Ltd. Deputy Commissioner of Income-tax [2024] 161 taxmann.com 18 (Bombay), struck down the notice seeking to reassess. 14. The coordinate bench relied upon several precedents emanating from the Hon'ble Supreme Court and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emed to have been incurred for the purpose of business and hence shall not be allowed as deduction under section 37. However, the CSR expenditure which is of the nature described in section 30 to section 36 of the Act shall be allowed deduction under those sections subject to fulfilment of conditions, if any, specified therein." 18. Objects and reasons do suggest that the CSR expenditure, which is of the nature described in Sections 30 to 36 of the Act, shall be allowed as deductions under those Sections subject to the fulfilment of conditions, if any, specified therein. 19. The above-referred extract from the statement of objects and reasons finds echo in the circular dated 21 January 2015 issued by the CBDT. Clause 13.3 of this circular also clarifies that the CSR expenditure, which is of the nature described in Sections 30 to 36 of the IT Act, shall be allowed as deductions under those Sections subject to fulfilment of conditions if any specified therein. The Delhi High Court, in the case of the Principal Commissioner of Income Tax-7 Vs. PEC Ltd. has taken cognisance of the CBDT circular dated 21 May 2015 and observed that it was well established that the circulars of CBDT ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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