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2015 (7) TMI 680 - AT - Income TaxValidity of Reopening of assessment - whether CIT(A) erred in confirming the disallowance of compensation charges of ₹ 11,00,000/- paid to Bhairav metals considering that the same is not an expense of current year and holding that the same could be an advance or debit? - Held that:- The issue regarding debit of ₹ 11.00 lacs to the P&L Account was duly enquired into by the AO vide notice issued to explain several expenses debited to P&L Account. The detailed reply was submitted by the assessee to the AO alongwith documentary evidences to explain that the claim of the assessee regarding ₹ 11.00 lacs was legitimate claim. After considering those evidences the AO did not make any addition. In view of those evidences it can be said that AO had formed the opinion for not making addition of ₹ 11.00 lacs during the course of original assessment proceedings. Subsequently, based on the same evidence, which was produced by the assessee to contend that no addition was called for, re-assessment proceedings were initiated, which is clearly as a result of “change of opinion” and cannot be approved in the light of decision of Hon’ble Bombay High Court in the case of GKN Sinter Metals Ltd. vs. ACIT (2015 (1) TMI 832 - BOMBAY HIGH COURT ). Accordingly, accepting the arguments of Ld. AR that reassessment proceedings were not validly initiated - Decided in favour of assessee.
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