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TMI Blog2025 (3) TMI 1123X X X X Extracts X X X X X X X X Extracts X X X X ..... fication seems to be that the TDS was deducted in some cases @10% and not @2%. This is a very vague reply, and indeed, this reply was not presented during the assessment proceedings. We upheld the reopening of the assessment regarding the difference in rental figures. Non-deduction of TDS on staff salary - In the letters filed by the petitioner during the assessment proceedings, there are no details concerning the deduction of TDS on salary. The letter dated 17 August 2015 states that the ledger copy of the salary expenses is attached. However, such ledger copy has not been annexed in the writ petition, but the same appears to have been annexed with the rejoinder. On a perusal of the salary ledger account, it is unclear whether the TDS has been deducted. There is no mention in the objections on this issue and, therefore, the only inference which could be drawn is that there has been no disclosure during the regular assessment proceedings on this issue. Hence, the reopening is upheld even on this account. Claim of depreciation - Reasons recorded show that the petitioner has claimed depreciation on printers @60% in the audit report and the balance sheet, whereas according to the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide notice under section 142 (1) of the Act dated 29 May 2015. The petitioner vide letters dates 15 June 2015 and 17 August 2015 filed details and also submissions. On 19 October 2015, an assessment order under Section 143 (3) of the Act was passed assessing income at Rs. 13,92,550/-. 4. On 30 March 2021 i.e. after a period of 4 years from the end of the assessment year, the respondents issued a notice under Section 148 of the Act calling upon the petitioner to file its return of income since he had reason to believe that income has escaped assessment. The petitioner was furnished with reasons for reopening the assessment vide communication dated 19 January 2022. Briefly, the reason states difference between figures appearing in the AIR details and profit and loss account with respect to total receipts and rent and the said difference has not been disclosed. One of the issue for which reopening was sought also related to excess depreciation claimed on printers and non deduction of TDS on staff salary. The petitioner, objected to these reasons vide letter dated 24 January 2022 and requested for dropping the proceeding. However, the respondent vide order dated 23 February 2022 rejec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee has not disclosed income to the extent of Rs. 43,98,899/-. On verification of balance sheet and audit report, it is seen that during the year assessee has claimed depreciation for Canon Printers at @60% at Rs.1,89,198/-. However, the allowable depreciation on printer is @15% and 7.5% for less than 180 days which comes to Rs.47,300/-. The assessee has claimed excess deprecation of Rs. 1,41,898/-. Further, it is seen that the Assessee has not deducted TDS on staff salary. Assessee has shown rent of Rs.2,50,60,110/- in the Profit & Loss Account. As per AIR details assessee received rent of Rs.3,78,00,928/-. The assessee has not disclosed rental income of Rs. 1,27,31,818/- In view of the above facts, I have reason to believe that an amount of Rs. 1,72,72,615/-has escaped assessment for A.Y. 2013-14, within the meaning of provisions of section 147 of the Income Tax Act, 1961, due to failure on the part of the assessee to disclose true and correct income." 9. The reopening is sought on following four issues :- (i) Difference between the AIR details and profit and loss account towards total receipt amounting to Rs. 43,98,899/-; (ii) Excess depreciation claim on printers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etails, the same were not disclosed in the course of the regular assessment proceedings and, therefore, we cannot find any fault in the AO issuing notice under Section 148 of the Act beyond a period of 4 years from the end of the relevant assessment year. 12. Learned counsel for the petitioner submitted that the difference in rental income had been explained in response to a clarification on the audit memo. Firstly, we are surprised as to how the audit memo came to the attention of the petitioner since the audit memo is internal correspondence between the audit department of the revenue and the AO. Be that as it may, an explanation in response to the audit memo cannot be treated as disclosure during the assessment proceedings, but it is post the assessment proceedings. Therefore, the response to the audit memo cannot be considered for adjudicating whether there was a failure on the part of the petitioner to disclose fully and truly all material facts necessary for the assessment. In any case, in the clarification to the audit memo on page 54 of the petition, there is no explanation of the difference between rental figures. However, it appears that the petitioner's contention i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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