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2017 (11) TMI 1737 - AT - Income TaxReopening of assessment - Addition on account of change in accounting policy with respect to recovery of non-performing advance where assessee has filled suits, decree or compromised accountsbonafide belief - Held that:- Reopening is with respect to reappraisal of the "notes on accounts" of the assessee which was there at the time of original assessment also. The bank has disclosed all material facts to the LD AO at the time of original assessment. There was no failure on the part of the assessee to disclose fully and truly material fact of the computation of total income. This stand of the assessee is also supported by the order of the Hon'ble Supreme Court in case of CIT Vs. Corporation Bank [1999 (2) TMI 16 - SUPREME COURT]. Thus assessee has not failed to disclose fully and truly the material facts Addition on account of change in method appropriating partial recovery with respect to NPA account where suits filed or accounts are compromised - Held that:- In the present case the revenue has failed to establish that how the change in the method of accounting is not permissible. The finding of fact which was arrived at by the Commissioner (Appeals) was that the change in the method of accounting was bona fide and it has been followed regularly and consistently. The changed method has been held to be a better method for preparing and presenting financial statements of income of the assessee. DR could not show us any reason that the change in the method of accounting is detrimental to the interest of the Revenue. DR also could not controvert that the change was bona fide and consistently followed after the year in which it was changed - addition of ₹ 10.43 crores on account of change in method appropriating partial recovery with respect to NPA account where suits filed or accounts are compromised to be deleted - Appeal decided against revenue.
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