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2013 (3) TMI 463 - AT - Income TaxReopening of assessment - purchase of designs and drawings treated as revenue are of Capital nature - Held that:- It is evident that in the original assessment, the assessee claimed certain expenses which are in the nature of purchase of designs and drawings to be revenue expenditure and the same were disallowed as such. Now, in the opinion of the AO it is in the nature of capital expenditure. Thus, as per the AO himself, there is no failure on the part of the assessee to disclose any material fact necessary for assessment. It is a clear case of change of opinion wherein the succeeding AO is of the opinion that the expenditure which was allowed in the original proceedings as revenue expenditure is in the nature of capital expenditure. However, as per the proviso to Section 147, unless there is any failure on the part of the assessee to disclose any material fact, the assessment cannot be reopened. See Atma Ram Properties Pvt.Ltd. Vs. DCIT (2011 (11) TMI 51 - DELHI HIGH COURT) if AO had failed to apply legal provisions/section of the Income-tax Act, 1961, the fault cannot be attributed to the assessee - in favour of assessee.
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