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2014 (4) TMI 70 - AT - Income TaxReopening of Assessment – Whether, reopening of assessment of assessee u/s 147 justified when CIT (Appeals) had not adjudicated grounds relating to reopening - Held that:- CIT(Appeals) was duty-bound to adjudicate on each and every ground raised by assessee unless assessee had given in writing that he was not pressing grounds - When there is a non-disposal of ground by CIT(Appeals), level of adjudication is lost - If Tribunal proceeds to adjudicate issue straightaway, it is loosing wisdom of an intermediary level of adjudication - Issue regarding reopening of assessment was never adjudicated by CIT(Appeals) - Matter has to go back to file of CIT(Appeals) and he has to adjudicate ground raised by assessee regarding jurisdiction of A.O. to reopen assessments – Decided in favour of assessee. Depreciation on Securities – Investments - Whether differentiation attempted by CIT(Appeals) between “permanent” and “current” categories of investments warranted interference - Held that:- in case of Nedungadi Bank Ltd. and CIT v. Karnataka State Cooperative Apex Bank [2001 (8) TMI 9 - SUPREME Court], no bifurcation was attempted between “permanent” and “current” category for valuation - Differentiation attempted by CIT(Appeals) between “permanent” and “current” categories of investments was not warranted - Its investments can be valued at cost or market value whichever is lower and depreciation arising can be deducted from its profit before arriving at its total income - Similarly, if such valuation results in appreciation, profits would also go to increase its total income - Issue regarding depreciation on securities is decided in favour of assessee. Validity of decision taken by the committee of disputes (COD) prior to decision of Apex Court - Held that:- Once a decision has been taken by the COD, during its period of utility, after exercising its mind, that certain issues need not be taken up in appeals, it cannot be given a go-bye. Decision of Hon'ble Apex Court in Electronics Corporation of India’s case [2011 (2) TMI 3 - Supreme Court] cannot be so interpreted to render nugatory decisions already taken by COD. In other words, net effect of the Apex Court decision, in our opinion, is that all applications pending before COD as on 17th February 2011 shall abate, all permissions already granted and all denial of permission already communicated will have to be taken cognizance and effect given. - the ground relating to disallowance under Section 80M of the Act stands dismissed. Provisions for Bad debts relating to foreign branch - Held that:- There is no dispute that income from foreign branches was not included in the total income of the assessee taxable in India. Therefore, there is no relevance for any addition for provision of bad debts made of such foreign branches in their accounts. - This issue need verification by AO - matter remanded back.
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