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2016 (5) TMI 1129 - AT - Income TaxReopening of assessment - non-deduction of TDS - Held that:- If the Assessing Officer for whatever reason has reason to believe that income has escaped assessment it confers jurisdiction to reopen the assessment. It is, however, to be noted that both the conditions must be fulfilled if the case falls within the ambit of the proviso to section 147. The case at hand is covered by the main provision and not the proviso. So long as the ingredients of section 147 are fulfilled, the Assessing Officer is free to initiate proceeding under section 147 and failure to take steps under section 143(3) will not render the Assessing Officer powerless to initiate reassessment proceedings even when intimation under section 143(1) had been issued.In our opinion, the assessment was re-opened to consider the issue of non-deduction of TDS and we do not find any infirmity in reopening assessment , which was duly re-opened after recording the reasons, s such we confirm the same. - Decided against assessee. Disallowance u/s.40(a)(ia) - Held that:- The issue in dispute is squarely covered by the decision of Co-ordinate Bench of Tribunal in the case of Shri N.Palanivelu Vs. ITO [2015 (10) TMI 1415 - ITAT CHENNAI] wherein held that section 40(a)(ia) is not applicable when there is no outstanding balance at the end of the close of the year relevant to the assessment year in respect of these payments. However, the assessee has not brought on record, the details of outstanding expenses or schedule of sundry creditors showing whether the impugned amount is outstanding at the end of the close of the previous year relevant to the assessment year either in the name of the party or outstanding expenses. Hence, in the interest of justice, we are remitting the issue back to the file of the Assessing Officer with direction to verify the claim of the assessee and the assessee shall place necessary evidence in support of his claim. Disallowance u/s 14A - Held that:- Assessee has considerable investments at the opening as well the close of the year under consideration. Therefore, the portion of expenditure attributable to the investments made by the assessee has to be computed as per Rule 8D of the I.T Rules. Therefore, the Assessing Officer was of the opinion that it is a clear diversion of interest bearing funds to other purposes. The assessee would be entitled to claim deduction of interest under section 36(1)(iii) of the Act on the borrowed funds utilized for business purpose. The only benefit the assessee derived was the dividend income which was not assessable under the Act, we are of the opinion that the disallowance under section 14A of the Act was squarely attracted and the Assessing Officer has rightly disallowed the claim. - Decided against assessee Treatment to rent received from two properties - income from house property or business income - Held that:- As decided in assessee's own case for assessment year 2005-06 to 2008-09 that income from the above properties to be assessed as business income and not as income from house property. - Decided against revenue
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