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2023 (2) TMI 468 - BOMBAY HIGH COURTReopening of assessment u/s 147 - notice issued beyond the period of four years from the end of the relevant assessment year - Disallowance on account of gift expenses - admissibility of expenses incurred in providing freebees to Medical Practitioner by Pharmaceutical and allied Heath Sector Industry - HELD THAT:- Although in the Order of assessment, the assessing officer had entertained a doubt regarding genuineness of the expenses, which as per him had not at all been established to have been incurred wholly and exclusively for the purpose of business, yet he had proceeded to disallow on an estimate basis expenses to the tune of 10 per cent and made an addition of Rs.2,31,82,889/- to the total income of the assessee. Therefore, it cannot be said that the Petitioner had not disclosed the relevant material facts during the assessment proceedings. The Petitioner was only obliged to disclose the material primary facts and was certainly not obliged to refer to the statutory provisions or the regulations of 2002 at the time of fling the return or during the course of the assessment proceedings. Circular No.5/2012 referred to the position of the regulations of 2002 after its amendment in the year 2009 and, therefore, neither the circular nor regulation 6.8 incorporated w.e.f. 10 December 2009 would be applicable to the instant case pertaining to assessment year 2008-09. It is settled that law to be applied is the one that is in force in the relevant assessment year, unless otherwise provided expressly or by necessary implication - CIT Vs. Insthmian Steamship Lines [1951 (11) TMI 1 - SUPREME COURT] and Reliance Jute & Industries Ltd. Vs. Commissioner of Incometax [1979 (10) TMI 2 - SUPREME COURT]. Since the CBDT Circular No.5/12 as also Regulation 6.8 of 2002, were not applicable to the case of the Petitioner for the relevant assessment year 2008-09, there would be no tangible material or basis for the assessing officer to have ‘reason to believe’ that income for the said assessment year 2008-09 had escaped assessment. Decided in favour of assessee.
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