9911796707
TMI Blog2025 (3) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Appeal. 3. In the facts of the matter and in law, the Learned Commissioner Income Tax (Appeal) erred in confirming the assessment order on an erroneous appreciation of the factual matrix of the transaction of remuneration for the feature film - RA One. 4. In the facts of the matter and in law, the Learned Commissioner Income Tax (Appeal) erred in re-adjudicating the issue of DTAA credit that had already been the subject matter of Appeal and that was to be allowed to the Appellant after verification by the Assessing Officer. 5. In the facts of the matter and in law, the Learned Commissioner Income Tax (Appeal) erred in upholding the validity of the re-assessment proceedings and notice issued u/s 148 of the Income-tax Act, 1961, in a clear case of 'change of opinion' by the Assessing Officer as the subject of double taxation relief claimed had already been examined by the Assessing Officer in the original 143(3) proceedings. He further erred in concluding that the Appellant has not disclosed fully and truly all material facts necessary for the assessment and that there has been a failure on part of the Appellant in warranting reassessment. 6. In the facts of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - was not proved to be genuine by the appellant. 13. In the facts of the matter and in law, the Learned Commissioner Income Tax (Appeal) erred in holding that the Appellant had himself treated the entire receipts as having arisen out of India. 14. In the facts of the matter and in law, the Learned Commissioner Income Tax (Appeal) erred in concluding that the professional income from Indian Source cannot attract any foreign TDS or foreign tax liability though the performance of services is rendered partly outside India. 15. In the facts of the matter and in law, the Learned Commissioner Income Tax (Appeal) erred in upholding the interest imposed in the Assessment Order under Section 234A, 234B, 234C and 234D of the Income-tax Act, 1961." 3. In this appeal, the assessee has challenged the validity of the reopening of the assessment under section 147 of the Act and has also raised the grounds on merits, challenging the additions made by the Assessing Officer ("AO"). Since the ground challenging the reopening of assessment under section 147 of the Act has raised a jurisdictional issue, therefore, the same is considered at the outset. 4. As far as the issue relating to the valid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial existed. 23. It is therefore, clear that the basis for a valid re-opening of assessment should be availability of tangible material, which can lead the AO to scrutinize the returns for the previous assessment year in question, to determine, whether a notice under Section 147 is called for. 29. Another aspect which should not be lost sight of is that the information or "tangible material" which the assessing officer comes by enabling re-opening of an assessment, means that the entire assessment (for the concerned year) is at large; the revenue would then get to examine the returns for the previous year, on a clean slate - as it were. Therefore, to hold- as the High Court did, in this case, that since the assessee may have a reasonable explanation, is not a ground for quashing a notice under Section 147. As long as there is objective tangible material (in the form of documents, relevant to the issue) the sufficiency of that material cannot dictate the validity of the notice." 7.4. One of the arguments of the appellant is that the re-assessment proceedings were done beyond the period of 4 years and that there is no failure on the part of the appellant to disclose all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sclose is on the assessee and the burden of making a full and true disclosure of material facts does not shift to the Assessing Officer. The assessee has to disclose fully and truly all material facts. Producing voluminous records before the Assessing Officer does not absolve the assessee of the obligation to disclose material facts and the assessee cannot be heard to say that if the Assessing Officer would have conducted a further enquiry, he would have come into possession of material evidence with the exercise of due diligence. An assessee cannot throw reams of paper at the Assessing Officer and rest content in the belief that the Officer better beware or ignore the hidden crevices in the pointed material at his own peril." 7.10. Further, in the case of P.V.S. Beedies (P.) Ltd. (237 ITR 13), the Apex Court held that even the audit party can point out a fact, which has been over looked by the ITO in the assessment. Though there cannot be any interpretation of law by the audit party, it is entitled to point out a factual error or omission in the assessment and reopening of a case on the basis of factual error or omission pointed out by the audit party is permissible under law. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he film Raone which was routed through Winford Production Ltd.(WPL) (United Kingdom based Line producer). RECPL paid Rs. 10 crore to WPL after deducting TDS of Rs. 1 crore which ultimately paid Rs. 7.60 Crore to the assessee after deducting FEU (UK Tax deduction) of Rs. 1.40 Crore. The assessee offered this amount as income earned in UK and paid additional tax in UK of Rs. 2,70,17,977. This it is evident that such arrangement of payment has caused revenue loss to the government of India. In view of the facts mentioned above, I have reason to believe that income of more than Rs. 1 lakh has escaped assessment within the meaning of section 147.of the I.T. Act. As the income chargeable to tax has been under assessed u/s. 143(3) of the IT Act, the case of the assessee is required to be reopened u/s.147 of the IT Act, so as to reassess the assessee's correct income for A.Y.2012-13. In view of the above, a proposal in the prescribed proforma for your kind perusal and necessary approval within the provisions of section 151(1) of the I.T. Act, 1961 for the issue of notice u/s.148 of the IT Act for A.Y.2012-13 is put-up." 10. As per the assessee, in the aforesaid reasons recorded by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not even an allegation by the AO that income chargeable to tax has escaped assessment due to failure on the part of the assessee to disclose fully and truly all material facts. 13. From the perusal of the order disposing the assessee's objections against the reopening of assessment, forming part of the paper book from pages 204-210, we find that it was for the first time there was any whisper of the allegation that there was gross failure on the part of the assessee to disclose all the material facts fully and truly. Therefore, it is ostensible that the reasons recorded while initiating the re-assessment proceedings were completely silent as regards the allegation that income chargeable to tax has escaped assessment due to failure on the part of the assessee to disclose fully and truly all material facts, and vide order disposing the assessee's objections, the AO tried to improve upon the reasons by making the allegation, which is completely impermissible. 14. In this regard, it is relevant to note the following observations of the Hon'ble Jurisdictional High Court in Hindustan Lever Ltd v/s R.B. Wadkar, reported in [2004] 268 ITR 332 (Bom.): - "20. The reasons recorded by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d assessment during the year under consideration. We find that the entire edifice of the impugned re-assessment proceedings is based on the perusal of case records which were already considered during the scrutiny assessment proceedings concluded under section 143(3) of the Act. This aspect is further evident from para 3.4 of the order passed under section 143(3) r/w section 147 of the Act, wherein the AO completely denied the claim made under section 90 of the Act, after noting that partial relief was granted to the assessee vide order dated 16/03/2015 passed under section 143(3) of the Act. Thus, the decision of the Hon'ble Supreme Court in Phool Chand Bajrang Lal v/s ITO, reported in (1993) 203 ITR 456 (SC), relied upon by the learned DR, also does not support the submissions of the Revenue as, in the present case, there were neither any fresh facts nor some information with regard to the facts previously disclosed, which came to the possession of the AO after conclusion of the scrutiny assessment proceedings, and the entire re-assessment proceedings were initiated on re-appraisal of facts already available on record. 16. Therefore, in view of the facts and circumstances of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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