TMI Blog2009 (8) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... section 50 of the I.T. Act. These three grounds are interrelated and accordingly they are considered together. 3. The brief facts are that the assessee filed return of income on 16-10-2001 declaring loss of Rs. 2,790. Assessment under section 143(3) was com-pleted on 27-11-2002 wherein the assessee s income from rent has been treated as income from house property and accordingly the assessment has been completed. Subsequently on the basis of the Revenue s objection with the permission of the CIT, the Assessing Officer reopened the assessment by recording the reasons. It is the contention of the assessee that the reasons for reopening have not been communicated and accord-ingly reopening of assessment without any additional information having completed the assessment earlier under section 143(3) was bad in law. The CIT(A) rejected the contention stating that the Assessing Officer has discussed the reasons for reopening in the remand report as well as in the assessment order and was informed the A.R. during the course of hearing after considering the reply. Accordingly he held that it cannot be stated that the assessment is bad in law. While rejecting the grounds for reopening, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the sale proceeds of the old asset the assessee was correct in claiming the deduction in the computation of block of assets. Since the Assessing Officer has not accepted the business income and the rental income received were assessed under the head House property , it was the contention of the learned counsel that reassessment is a mere change of opinion and a difference of view on same set of facts that was taken by the present Assessing Officer and relied on the decision of the jurisdictional High Court in the case of Asian Paints Ltd. v. Dy. CIT [2008] 296 ITR 90 (Bom.). It was submitted that issuance of notice under section 148 for the reason that some material which was available on record while assessment was made was not considered means to reopening of assessment merely on the basis of change of opinion which is not permissible. 5. The learned D.R., however, relied on the facts as stated by the Assessing Officer and CIT(A). 6. We have considered the issue. Before adverting to the legal issue of reopening it is necessary to consider the facts on merits as well. We find that the action of the Assessing Officer in bringing to tax the short-term capital gain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assets in relation to the said preceding previous year and as further adjusted by the increase or the reduction referred to in item ( i )." 7. As can be seen from the above the adjustment made by the assessee is according to the provisions of the Act. Since both the industrial galas fall within the block the WDV is increased by the actual cost of the asset falling within the block and reduced by the amount payable in respect of the asset sold. Accordingly we do not find any mistake in assessee s working of the block of assets which is according to the provisions of section 43(6)( c ). The Assessing Officer s action in denying the inclusion of asset within the block is on the condition that the asset was not put to use. This condition was already negated by the ITAT in the above referred decision while considering the provisions of section 50 wherein it was held as under: "Section 50 makes special provision for the computation of capital gains in the case of depreciable assets. The effect, in brief of the section is to make certain modifications in the deductions to be allowed under sections 48 and 49 from the consideration received as a result of the transfer. Thus, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the computation of capital gains, as brought out by the Supreme Court in the case of CIT v. Express Newspapers Ltd. [1964] 53 ITR 250 it would be clear that the Court should not allow the provisions relating to section 50(1)( iii ) to be interpreted in the manner suggested by the revenue. There is no explicit or express requirement that the new asset should be put to use in any business carried on by the assessee. The CBDT Circular No. 469, dated 23-9-1986 shows that the main object of introducing the block of assets concept was only to reduce time and effort spent in detailed record maintenance. While giving effect to this object, there could have been no justification or warrant for prescribing a condition that the new asset, in addition to being an asset in respect of which the same rate of depreciation is prescribed as in the case of the other assets within the class, should also be used in a business carried on by the assessee. In the case of a building, the new building purchased should be one in respect of which the same rate of depreciation, as is prescribed in respect of other buildings, has been prescribed by the rules. If the assessee carries on a business, in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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