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2016 (5) TMI 624 - AT - Income TaxReopening of assessment - non explanation of working of the book profit - Held that:- We are of the considered view that assuming of jurisdiction by the AO in this case is bad in law for the reasons inter alia that when the assessee had specifically placed on record profit and loss account and books of account, audited balance sheets, tax audit report and certificate in Form No.29B in response to the query raised by the AO during the assessment proceedings that, “as to why assessment be not made at the book profit u/s 115JB of the Act”, the assessee has duly explained the working of the book profit and it certainly amounts to change of opinion. A bare perusal of the order passed by the CIT according approval for reopening goes to prove that he has accorded the approval in mechanical manner without applying his mind particularly when AO himself has not enunciated the reasons except quoting the language of section 147, the approval accorded by CIT is not sustainable. Where Commissioner approved suggestions made by the audit party, such approval could not be seen as substantial compliance of section 151 where notice for reopening was issued after a period of four years from end of the assessment year. Judgment of Vijay Rameshbhai Gupta vs. ACIT – (2013 (5) TMI 157 - GUJARAT HIGH COURT ) is applicable to the facts and circumstances of this case. Moreover, all the three adjustments on account of provision of diminution of value of assets, loss u/s 10B and provision for doubtful debts and advances respectively have been made by invoking the retrospective amendments made to section 115JB which is not permissible as has already been discussed by us in the preceding paras. - Decided in favour of assessee.
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