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2021 (8) TMI 443 - HC - Income TaxValidity of the notice issued u/s 148 - non deduction u/s 195 - assessee has made payments to Associated Enterprise for shared service/cost sharing expenses - HELD THAT:- The facts of the case as narrated in the Appellate order would reveal that Assessment u/s.143(3) has been completed for A.Y.2011-12 after disallowing payments made to BASF Malaysia towards shared legal / administrative services u/s.40(a)(i) for failure to deduct tax at source u/s.195. The difference is that the disallowance of payments related to BASF Malaysia is stated in the appeal and the extent of disallowance is mentioned as ₹ 1,08,78,548/-. - in the reasons furnished for reopening in proceedings dated 12.10.2018 would state that the income escaped is ₹ 3,72,07,000/-. Therefore, there is a mismatching between the subject dealt with by the Appellate authority as well as the reasons furnished for reopening of assessment. Petitioner made an attempt to clarify certain transactions for the purpose of establishing that the subject matter is one and the same and the issue was relatable to the transactions from various countries. If the facts also, it is for the petitioner / assessee to place all such records before the Assessing Officer. Mere reopening of cannot be construed as conclusive. Still, the petitioner would get an opportunity to clarify these aspects and establish that there was no suppression or failure on the part of the assessee to furnish true and full disclosures. However, High Court cannot adjudicate these disputed aspects. Once there is a prima facie reason for reopening of assessment, which is essential under the provisions of Section 147 of the Act, rest of the adjudications are to be completed in all respects by affording opportunity to the assessee concerned. The initiation of proceedings cannot be crippled merely based on certain clarifications. Such clarifications as well as the documents relied upon are to be adjudicated in detail by the Assessing Officer for the purpose of arriving a decision during the course of 147/148 proceedings. This being the factum established, this Court is of the considered opinion that the petitioner has to co-operate for the completion of the assessment / reassessment proceedings by availing the opportunities to be provided and the respondents are bound to complete the proceedings as expeditiously as possible.
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