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2017 (9) TMI 671 - HC - Income TaxReopening of assessment - set off brought forward losses - eligible reasons to believe - Held that:- In the reasons for reopening of the assessment in the present case, the AO recorded that the Assessee was allowed to set off brought forward losses of ₹ 5,32,18,761/- whereas, according to the AO, as per the assessment records of the AY 2007-08, “no loss was available for set off in subsequent year” as the Assessee-company was assessed at an income of ₹ 19,73,01,700/- in AY 2007-08. Without indicating the manner in which there was failure on the part of the Assessee to disclose fully and truly, material facts necessary for the assessment, the AO has simply reproduced the words to that effect as occurring in the first proviso to Section 147 (1) of the Act. This, therefore, does not fulfil the mandatory requirement of the law. The fact of the matter is that for three AYs earlier to the AY in question, the assessments, after scrutiny under Section 143 (3) of the Act, were completed at a loss, although at a figure lower than that claimed by the Assessee. The assessment for AY 2005-06 was completed only on 25th November, 2008 whereas the Assessee filed its return for the AY in question on 30th September, 2008 and a revised return on 14th October, 2008. Consequently, the Assessee did not have benefit of the assessment order passed for AY 2005-06 at the time of filing its return for the AY in question. There was therefore no failure by the Assessee to make a full and true disclosure of the material facts relevant for the assessment.- Decided in favour of assessee.
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