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2014 (7) TMI 345 - GUJARAT HIGH COURTReopening of notice u/s 147 r.w. section 148 of the Act – additions on some other grounds - Filing of separate reports - Deduction u/s 80IA(iv) of the Act on generation of electricity – Held that:- In Income-tax Officer v. VXL India Ltd. [2008 (8) TMI 273 - GUJARAT HIGH COURT] it has been held that provision of section 80HHC of the IT Act requires that the report of a chartered accountant in the prescribed form should be attached along with the return of income, certifying that the deduction has been correctly claimed in accordance with the provisions of this section, but, that would not mean that such report if is not attached along with the return of income and if is produced before the Assessing Officer during the course of assessment proceedings, the entitlement of the assessee for deduction u/s 80HHC would go away - to obtain the report of the chartered accountant is a condition precedent and it is mandatory in nature. The assessee had submitted a separate report for all the undertakings claiming deduction u/s 80IA, during the course of assessment proceedings - the first ground of reopening, interest from the trade debtors would be qualified for deduction u/s 80IA only on the furnishing of separate reports cannot be upheld - once the notice for reopening is issued and is allowed to be proceeded, the AO can also open other issues, other than those for which the reasons have been recorded and, therefore also, ordinarily in a writ petition, the Court would be slow in interfering with such notices - for assuming jurisdiction u/s 147 of the Act what is essential is a valid reopening of a previously closed assessment and If the very foundation of the reopening is knocked out, any further proceeding in respect to such assessment naturally would not survive. As both the grounds in respect of which the notice has been issued fall and both these reasons recorded in the reopening of the assessment - the AO would not be in a position to make any additions on some other grounds which never formed part of the reasons recorded by him - a valid reopening of previously closed assessment is a must for assuming jurisdiction u/s 147 of the Act - When the very foundation of such reassessment are both the reasons recorded and by virtue of binding decisions, neither of the grounds is sustainable, permitting such notice to be pursued would be an exercise in futility and the Court cannot disregard such vital aspects while addressing the challenge to the notice of reopening – thus, the notice for reopening of assessment is set aside – Decided in favour of Assessee.
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