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2020 (9) TMI 459 - AT - Income TaxReopening of assessment u/s 147 - non deduction of tds u/s 195 - disallowing expenses u/s.40(a)(i) observing that the assessee could neither prove that it had made application to the AO to determine the appropriate portion of the sum so chargeable u/s 195(1) and neither the undertaking nor the CA certificate for the FY 2010-11 as envisaged in the CBDT circulars was referred to - CIT-A deleted both reopening and addition u/s.40(a)(i) - HELD THAT:- From a bare perusal of the reasons recorded by the AO for reopening of assessment it is clear that the AO has reopened the assessment on the ground that the foreign currency was incurred without making TDS u/s.195 and no application under section 192(2), 192(3) or 197 of the Act was made by the assessee for non-deduction of tax u/s.195. On perusal of the relevant materials placed on record, we find that the during the original assessment proceedings, the AO had considered the issue of non-deduction of tax u/s.195 on payment made to foreign parties and had not made any disallowance. After that no new fact has come to the knowledge of the AO after the original assessment was framed under Section 143(3) of the Act vide Order dated 14.03.2014. The AO has merely re-examined the profit and loss account of the assessee to initiate the reassessment proceedings. In any case, the CIT(A) has in the impugned order at page 8 has recorded a finding of fact that the very same payment has been discussed elaborately in the original assessment order passed under Section 143(3) of the Act. CIT(A) has followed the decision of Kelvinator of India ltd [2010 (1) TMI 11 - SUPREME COURT] wherein, it was held that the concept of change of opinion must be treated as an inbuilt test to check the abuse of power by the AO and that even after 1.4.1989, the date from which the amended provisions of section 147 came into force, the AO has power to reopen an assessment, provided there is tangible material to come to the conclusion that there is escapement of income from assessment. In this case, no tangible material has come to the knowledge of the AO to reopen the assessment. Ld CIT(A) has also followed the decisions of this Tribunal in assessee’s own case under similar facts in quashing the reassessment order. In the reasons recorded for reopening of assessment, there is no whisper, what to speak of any allegation, that the assessee had failed to disclose fully and truly all material facts necessary for assessment and that because of this failure there has been an escapement of income chargeable to tax. Merely having a reason to believe that income had escaped assessment, is not sufficient to reopen the assessment - there was no new tangible materials, as discernible from the reasons recorded by him for initiation of reassessment proceedings in his hands, thus, it is a case of change of opinion. - Decided in favour of assessee.
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