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2021 (10) TMI 411 - Income Tax
Reopening of assessment u/s 147 - Reopening based on rectification notice - Whether A.O had wrongly assumed jurisdiction u/s 147 of the Act, for the reason, that he had reopened his concluded assessment on the very same reason on which notice u/s 154 of the Act was issued to him? - HELD THAT:- In the present case, it is a matter of fact borne from the record that the notice issued u/s 154 by the A.O had neither been dropped nor culminated in an order till date. Accordingly, the support drawn by the ld. A.R from the aforesaid proposition that having issued a notice u/s 154 which thereafter had been dropped/vacated by the A.O, the case of the assessee on the very same basis cannot be reopened u/s 147 of the Act would be of no avail in the backdrop of the facts involved in the case before us.
Unlike the case of the assessee before us in the case of Berger Paints India Ltd. [2009 (8) TMI 557 - CALCUTTA HIGH COURT] the rectification proceedings that were initiated by the A.O had thereafter been dropped. On a similar footing, in the case of M/s Nawany Corp (I) Ltd. [2012 (5) TMI 202 - ITAT MUMBAI] the proceedings u/s 154 are stated to have been concluded after the assessee had submitted its reply. Backed by the aforesaid facts, not being able to persuade ourselves to subscribe to the contention of the ld. A.R that the A.O having issued a notice u/s 154 of the Act could not have on the same basis validly reopened its case u/s 147 of the Act, we, thus, dismiss the same. The Grounds of appeal Nos. 2 & 3 are dismissed.
Disallowance u/s 14A r.w.r. 8D - non recording his satisfaction that as to why the claim of the assessee that no part of the expenses could be attributed to earning of the exempt income - HELD THAT:- A.O in the case before us had dislodged the aforesaid claim of the assessee that no part of the expenditure was attributable to earning of its exempt income without recording his satisfaction as to why the same was not to be accepted having regard to the accounts of the assessee which were placed before him - we are of a strong conviction that the A.O had wrongly assumed jurisdiction and worked out the disallowance in the hands of the assessee u/s 14A - We, thus, in terms of our aforesaid observations respectfully follow the judgments of Godrej & Boyce Manufacturing Company Ltd. [2017 (5) TMI 403 - SUPREME COURT] and Maxopp Investment Ltd.[2018 (3) TMI 805 - SUPREME COURT] and vacate the disallowance made by the A.O under Sec.14A of the Act. -Decided in favour of assessee.