2023 (1) TMI 765 - AT - Income Tax
Reopening of assessment u/s 147 - undisclosed work in progress - HELD THAT:- As evident from the perusal of the case file that the assessee was found to have not disclosed “fully” and “truly” all the material facts once it is an admitted position that the work in progress had seen light of the day only as per his letter dated 04.01.2008 addressed to M/s. Samcon Infrastructure Corp. We thus reject the assessee’s instant last legal argument, not raised before the CIT(A), in the Revenue’s appeal.
Addition of the assessee’s work in progress - Also no merit in the assessee’s instant arguments on merits as well. Suffice to say, it is an admitted fact that the assessee has nowhere declined the department’s clinching stand all along that he had never disclosed the work in progress at all in his books through-out.
AO foregoing detailed discussion has also not invoked the so-called accrual principle which could be held to have been rightly appreciated in the CIT(A)'s impugned order. This is thus a clearcut instance wherein the impugned addition ought had been assessed as “unexplained” work in progress only.
Question as to whether such a change in the head of income, if at all, could be allowed to be made in sec.254 proceedings is concerned, we find that not only the hon'ble jurisdictional high court’s landmark decision in Ahmedabad Electricity Co. Ltd. [1992 (4) TMI 29 - BOMBAY HIGH COURT] has settled the law long back that the clinching statutory expression “may pass such orders thereon as it thinks fit” has to be interpreted in wider than in narrower terms but also their lordships hold in CIT vs. Gilbert & Barker Manufacturing [1976 (12) TMI 39 - BOMBAY HIGH COURT] indeed affirm our jurisdiction to change even head of income, as the case may be, after putting the parties to notice.
Assessee’s further contention that the impugned vouchers does not relate to F.Y. 2007-08 also fails to cut any ice as we can very well direct the Assessing Officer to assess the same in the concerned earlier assessment years u/s.153(6) of the Act. And also the impugned sum stood crystalised and became due on demand only in assessment year 2008-09 in issue. Faced with this situation, we restore the Assessing Officer’s action adding the impugned sum in assessee’s hands in above terms - Decided in favour of revenue.