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2018 (2) TMI 267 - AT - Income TaxReopening of assessment - granting set off of unabsorbed depreciation brought forward from the AY 1997-98 in the present assessment year - Held that:- Unabsorbed depreciation of the AY 1995-96 and 1996-97 would become deprecation of the AY 2002-03 after amendment, because 8 years have not expired upto the AY 2002-03. This amount will become deprecation of AY 2002-03, and thereafter it would be carried forward for subsequent years and will be set off against profit and gains of subsequent years without any limitation of alleged 8 years. We have extracted the finding of the AO where the ld.AO has applied this limitation of 8 years from the AY 1997-98 and held that it will expire in AY 2004-05. AO has committed an error by taking the limit in this manner. He has to compute 8 years upto the AY 02-03, and thereafter it would become current unabsorbed depreciation in the AY 2002-03 which will be available for set off in subsequent year without any restriction of limitation of years. Thus, the issue is squarely covered in favour of the assessee. We do not find any error in the order of the ld.CIT(A) as far as second fold of contention is concerned. We find that notice under section 148 was issued on 13.2.2012 i.e. after expiry of 4 years from the end of the assessment year. There was a scrutiny assessment under section 143(3) of the Act. Proviso appended to section 147 puts a restriction on the powers of AO to reopen the assessment by issuance of notice under section 148 in the cases where 4 years have expired and scrutiny assessment under section 143(3) was made. The income of the assessee has escaped from the assessment on account of failure of the assessee to disclose all material facts fully and truly, no notice under section 148 could be issued. All these facts were also in the knowledge of the AO when he passed the assessment under section 143(3). There is no failure at the end of the assessee. - Decided against revenue
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