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2021 (10) TMI 232 - HC - Income TaxReopening of assessment u/s 147 - expenditure incurred towards sales commission - HELD THAT:- Assessment proceeding are based on the basis of same information which was available with the AO at the time of original order of assessment and inferences drawn by the AO on the same set of facts cannot be said to be tangible material. It is also noteworthy that mere fact that expenses were huge in the opinion of the AO cannot be a ground for re-opening the assessment and necessity of incurring expenditure cannot be gone into by the AO. No material was gathered in the survey proceeding to suggest that expenditure incurred towards sales commission is not an allowable expenditure and disallowance made in respect of the expenditure for the subsequent Assessment Year 2006-07 cannot be a ground for re-opening the assessment. Tribunal rightly recorded the findings of fact that there is no tangible material on the basis of which assessment for Assessment Year 2005-06 was re-opened and the assessment of the subsequent AY is based on the inferences drawn from certain facts which cannot be construed as tangible material. The reasons mentioned in the notice for re-assessment are based on mere change of opinion and therefore, the re-opening of the assessment proceeding is not permissible in the facts and circumstances of the case. The aforesaid finding cannot be said to be perverse - Decided in favour of assessee.
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