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2020 (12) TMI 46 - AT - Income TaxValidity of re–opening of assessment u/ 147 - as argued assessment under section 147 of the Act was made after expiry of four years - claim of depreciation on various categories of securities AND deduction claimed under section 36(1)(viia) - HELD THAT:- As regards the first reason, admittedly, no disallowance or addition has been made in the re–assessment order. This, in other words, means the Assessing Officer himself was satisfied that there is no escapement of income on this issue. Claim of deduction under section 36(1)(viia) - specific allegation of AO that some of the branches in respect of which the assessee claimed deduction, did not qualify as rural branches as per Censes Department - It is a fact on record that while disposing off assessee’s appeal, Commissioner (Appeals) has deleted the disallowance made by the AO - essentially, the dispute relating to assessee’s claim of deduction under section 36(1)(viia) of the Act has attained finality after the decision of learned Commissioner (Appeals) on the issue arising out of the original assessment proceedings. Though, these events have happened much prior to the initiation of re–assessment proceedings and, in effect, the original assessment order has merged with the order of learned Commissioner (Appeals), still the Assessing Officer went ahead to not only initiate the proceeding under section 147 of the Act on the very same issue, but has also passed an assessment order under the said provision. This, in our view, is contrary to the settled legal position. On a perusal of the objections raised by the assessee, a copy of which is at Page–70 of the paper book, it is noticed that one of the grounds raised by the assessee is, on the basis of a census report of 2004 which is not applicable to the impugned assessment year, it cannot be said that some of the branches have exceeded certain population limit, hence, would not qualify as rural branches. However, it is a fact on record that the objection filed by the assessee raising such a vital issue has not been disposed off by the Assessing Officer independently prior to completion of assessment under section 143(3) r/w section 147 of the Act - Decided in favour of assessee.
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