Case Laws
Acts
Notifications
Circulars
Classification
Forms
Manuals
Articles
News
D. Forum
Highlights
Notes
🚨 Important Update for Our Users
We are transitioning to our new and improved portal - www.taxtmi.com - for a better experience.
⚠️ This portal will be discontinued on 31-07-2025
If you encounter any issues or problems while using the new portal,
please
let us know via our feedback form
so we can address them promptly.
Home
2023 (12) TMI 407 - AT - Income TaxMaintainability of the reassessment proceedings - deduction u/s. 35(2AB) - non furnishing Form 3CL quantifying eligible expenditure u/s. 35(2AB) regarded in law as non-disclosure within the meaning of proviso to section 147 r/w Explanation 1 thereto - Notice issued beyond 4 years - HELD THAT - The procedure of communication of Form 3CL direct by the prescribed authority to the Revenue giving rise to the presumption that the same would stand communicated to the AO is as afore-noted not supported by the rule. The presumption nevertheless fails on facts i.e. on the assessee receiving Form 3CL approving a reduced deduction u/s. 35(2AB) (w.r.t. that claimed) on which the assessee is not questioned during assessment. And which ought to have impelled the assessee to in discharge of it s primary obligation furnishing Form 3CL either revise it s claim downward or state it s reasons for persisting with it s claim or both i.e. in case of partial scaling down of it s claim. Why in a given case the AO may himself question the assessee on it s higher claim implying knowledge of Form 3CL with the AO validating the presumption afore-said which would entitle the assessee to proceed accordingly. The assessee s disclosure obligation undergoes a qualitative change in light of this fact. Again could the assessee s conduct be faulted where Form 3CL reports deduction in the same sum as claimed by the assessee? We say so to emphasizes the need to calibrate the conduct toward true and full disclosure with the facts circumstances of the case which cannot be held as a constant or absolute. Tribunal in assessee s own case for AY 2012-13 2017 (8) TMI 841 - ITAT COCHIN being in fact undisputed particularly considering that the claim for deduction made was much higher than that on the basis of expenditure approved thus by the prescribed authority. It is this variance and not F/3CL per se that is the undisclosed primary material fact. The plea of presumption of the said Form being in the knowledge of the AOis not supported by the rule i.e. not available legally and besides falls flat on facts i.e., in view of a complete absence of any enquiry or reference thereto in the original assessment and therefore a false plea by the assessee who is obliged by law to disclose fully and truly all material facts necessary for assessment to the AO. Why the knowledge of Form 3CL being at a variance with the assessee s claim with the AO i.e. at the time of original assessment may where so eschew reassessment proceedings even for AY 2011-12 rendering the same as a change of opinion. The two aspects are inter-related with there being decisions as in Ganga Saran Sons P. Ltd. v. ITO 1981 (4) TMI 5 - SUPREME COURT wherein the Hon ble Apex Court found no failure on the part of the assessee to disclose material facts holding on that basis the AO could not have a reason to believe that any part of income had escaped assessment. The matter is to be examined from the stand-point of the obligation on the assessee to disclose all material facts necessary for assessment fully and truly i.e. as mandated by law and which a positive requirement we have giving our reasons found as not discharged. We are supported in our view by the decisions cited here-in-above as well as that relied upon by the parties before us. The matter as for AY 2011-12 shall travel to the file of the ld. CIT(A) for adjudicating the quantum adjustments in assessment under appeal before him after hearing the parties per a speaking order.
|