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2014 (11) TMI 1022 - ITAT MUMBAIReopening of assessment - advertisement expenditure incurred and the commission paid to non-resident disallowed - Held that:- It is not in dispute that during the course of original assessment proceedings the assessee furnished all the required details with regard to advertisement expenditure incurred and the commission paid to non-resident. The reason - as to why section 40(a) is not applicable - was also mentioned by taking support from the decision of the Apex Court in the case of Toshoku Ltd. (1980 (8) TMI 2 - SUPREME Court ) As can be noticed from the original assessment order the AO has thoroughly examined the facts of the case and had also noted that the assessee is having transactions with non-resident, which implies that the AO had taken note of Annexure-9 to Tax Audit Report. Thus it is not in dispute that the facts were present before the AO; more particularly, Annexure-9 to the Tax Audit Report and it could not have been overlooked by the AO at the time of making original assessment, since the AO had taken note of the fact that the assessee had business connection with certain foreign clients and some expenditure was also incurred in that connection. Thus mere subjective satisfaction of the AO, on the basis of the same set of material, would amount to change of opinion and cannot be equated to the expression "reasons to believe", in which event the reassessment proceedings, in our humble opinion, deserve to be treated as void abinitio. Having regard to the facts and circumstances of the case before us we respectfully follow the decision of the Hon'ble Apex Court in the case of Kelvinator India Ltd. (2010 (1) TMI 11 - SUPREME COURT OF INDIA ) to hold that the AO sought to reopen the assessment on mere change of opinion which is not permissible and hence we conclude that the notice issued under section 148 of the Act is not in accordance with law. Consequently we quash the reassessment proceedings - Decided in favour of assessee.
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