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2018 (3) TMI 315 - HC - Income TaxReopening of assessment - reopened within a period of four years from the end of the assessment year - entitled to duty drawback incentive deduction u/s 80IB (4) - Held that:- No substitution or deletion is permissible nor inferences therefrom are permitted. This is completely different from the present facts where an Assessee points out that the reasons recorded by the AO are not his own reasons and therefore, the reopening notice issued under Section 148 on the basis of such reasons are without jurisdiction. In such cases one would necessarily have to look at the surrounding circumstances which led to the issue of the reopening notice and recording of the reasons. Thus it is not a case of adding to the reasons and / or varying the reasons recorded by the AO but pointing out how the Assessing Officer having himself concluded that no income chargeable to tax has escaped assessment, on the very ground has now issued the reopening notice. Thus there is no merit in this objection of the Revenue. Time gap between the AO's response to the audit objection contesting that any income chargeable to tax has escaped audit and his issuing the reopening notice - Held that:- There is no evidence of the same on record. In any event in such a case the least that is expected of the Assessing Officer is to record in his reasons that he had earlier opposed the objection of the audit and the reason for the change of view on his part. It cannot be that passage of time would alone by itself indicate that there has been a fresh application of mind to the order passed under Section 143 (3) of the Act leading to his reason to believe that the income chargeable to tax has escaped assessment. One more fact that must not be missed is that reasons recorded itself indicates that “it is noticed from the Assessment records that the Assessee….”. On being specifically asked, Mr. Chhotaray very fairly informed us that the audit objection would be a part of the assessment records. Therefore, there is evidence on record that the audit objection was considered while issuing the reopening notice and there is nothing on record to even remotely suggest that in view of the delay in issuing the notice, AO applied his mind afresh (without being influenced by audit objection) to come to the same view as indicated in the audit objection Third grievance of the Revenue is that the impugned order is perverse in as much as it holds that the Assessing Officer did not apply his mind is without any basis. This we do not accept. The impugned order records the fact that it had examined the Assessing Officer's letter to the audit objection in respect of grant of deduction under Section 80IB (4). The response of the Assessing Officer's as contained in letter dated 29 October 2007 was before the Tribunal as a part of the paper book and in that letter, it has been mentioned at length on the basis of case law as existing in the relevant time that in his understanding of law the Respondent was entitled to the deduction under Section 80 IB (4) in respect of duty drawback incentive. Further the impugned order of the Tribunal also reproduced the audit objections as well as the reasons recorded and on comparing the two comes to a view that in substance both of them are identical. In the above view, it cannot even be remotely suggested that the impugned order of the Tribunal is perverse. Thus there is no merit in this objection of the Revenue. - Decided in favour of assessee.
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