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2012 (11) TMI 538 - ITAT CHENNAIQuantum of loans less than the investments made - Disallowance u/s 14A r.w.r. 8D is warranted - reopening of assessment - Held that:- AO had finalized assessment u/s 143(3) on 31.3.2005 wherein amount of loss claimed in return of Rs.3,73,69,044/- was modified to Rs.3,02,01,092/-. No doubt, in the assessment order, the issue of disallowance u/s.14A was not considered. However, the assessment was completed after considering assessee’s claim of Rs.1.55 crores as exempt u/s.10(33). The assessment finalized on 31.3.2005 was reopened by notice u/s 148 after more than five years from the end of relevant Asst. Year and it is evident that in the notice of reopening there is not even an iota of allegation that any income had escaped assessment attributable to failure on the part of the assessee in not disclosing full particulars. Thus except bald reference, there are no such reasons forthcoming in reopening notice. The notice was based on the assumption that on the opening and closing dates of balance sheet quantum of loans turned out to be less than the investments made & it suggested that loans were obtained for purpose of meeting and sustaining investments leading to exempt income but it cannot be accepted as it can be easily implied in such circumstances that the assessee had its own funds available for investment. Thus mere escape of income is insufficient to justify the initiation of action after the expiry of four years from the end of the assessment year - in favour of assessee.
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