TMI Blog2010 (6) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer held that it was not entitled to a deduction under Section 80HHC - Held that: . There was no failure on the part of the assessee to disclose fully and truly all material facts. The Assessing Officer could not have formed a reason to believe that income has escaped assessment. That apart, there is merit in the contention that in terms of the second proviso to Section 147, the assessment could not have been reopened – notice set aside – decided in favor of assessee - 772 OF 2010 - - - Dated:- 25-6-2010 - Mr.R. Murlidhar with Mr.Atul K. Jasani for the petitioner. Ms.Suchitra Kamble for the respondents. CORAM: Dr.D.Y. Chandrachud J.P. Devadhar, JJ. ORAL JUDGMENT (Per Dr.D.Y. Chandrachud, J.) 1. Rule. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s.5.29 crores. 4. A notice was issued to the assessee on 16 August 2004 for reopening the assessment. The ground which was set out in the notice was that the assessee had in its return of income declared a nil total income after claiming a deduction under Section 80HHC of Rs.3.42 crores. According to the Assessing Officer, the assessee had shown as against the adjusted profit of the business, a loss of Rs.5.29 crores. As the assessee had allegedly incurred a loss on the export business, the Assessing Officer held that it was not entitled to a deduction under Section 80HHC. The assessee filed its objections to the reopening of the assessment on 27 September 2005 and contended that it qualified for a deduction under subsection (3)(b) of Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For this purpose, appellant purchased steel plates, angles, channels etc. from the market and exported the same to Kenya for the project. As per the evidences filed and examined by the AO, no manufacturing work was done by the appellant and it has done simply trading export. The appellant had simply purchased the steel plates and exported the same either in the same condition or at the most after cutting to the size required by the purchaser. No new article or thing was brought into existence in this process. The appellant has submitted copies of drawings, purchase and sale invoices which have been examined by the AO in remand proceedings. In view of these facts and remand report, I am of the view that AO was not correct in treating the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment, for the said assessment year, I have reasons to believe that the income to the extent of Rs.1,28,85,916/has been escaped the assessment." 7. The learned Counsel appearing on behalf of the assessee urged four submissions in support of the petition: (i) There was a full disclosure by the assessee of all the material facts in relation to the assessment and the assessee had specifically claimed a deduction as a trader exporter under Section 80HHC(3)(b); (ii) There was a due application mind by the Assessing Officer. The Assessing Officer had initially rejected the contention of the assessee that he was a trader exporter and came to the conclusion that the assessee was a manufacturer exporter. On appeal, when a remand report was ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w the record before the Court discloses that the assessee had furnished, together with its return, details of the gross total income (Rs.3.42 crores); the claim for the deduction under Section 80HHC; details of the profit and loss account pertaining to the export and domestic turnover and relevant information in the report contained in Form 10CCAC. The information provided in form 10CCAC was to the effect that profits from the export of trading goods were Rs.8.60 crores while there was a loss from domestic operations amounting to Rs.5.29 crores. The Assessing Officer, obviously applied his mind to the issue because when he passed an order of assessment on 31 march 2006, he specifically held that the assessee was carrying on manufacturing ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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