TMI Blog2011 (12) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... yed for quashing of order dated 28.9.2010 passed by the respondent dismissing their objections to the re-opening of assessment under Section 147/148 of the Act. 2. The petitioner is engaged in the business of consultancy in renewable and non-conventional sources of energy and also has income from power generation. Petitioner has set up demonstration units of Wind Energy Generators (WEGs) in Tamil Nadu. These WEGs began generating electricity and the electricity so generated was sold to the State Electricity Board. The petitioner it is admitted had been claiming benefit under Section 80IA of the Act in respect of income earned from power generation from the assessment years 2000-2001 onwards. 3. For the assessment year 2003-04, the assessee had filed its return of income on 25.11.2003 and thereafter assessment order under Section 143(3)(c) of the Act was passed on 30.1.2006. The assessee was allowed deduction under Section 80IA to the extent of Rs.1,17,71,062/-. 4. It appears that there was an audit note/objection. The copy of the said audit note has not been placed on record and is also not available on the original file/record produced by the Revenue before us. However, re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s such income and also any other income chargeable to tax which has escaped assessment and which comes to the notice subsequently during the course of assessment proceedings, may kindly be accorded. 6. As the reasons were recorded after the four years of the end of the assessment years the Assessing Officer also took approval of the Jurisdictional Commissioner, which was granted on 26.3.2010. 7. The learned counsel for the petitioner submits that the jurisdiction pre-conditions for issue of re-assessment year under Section 148 prescribed under Section 147 are not satisfied in the present case. It is stated that the issue of deduction under Section 80IA was examined at the time of original assessment and when assessment order dated 30.1.2006 was passed. Secondly, it is submitted that in the present case proviso to Section 147 is applicable and, therefore, re-assessment proceedings can be initiated, if there was failure or omission on the part of the assessee to disclose material facts. It is stated that in the present case material facts were disclosed at the time of original assessment. 8. We find merit in the contentions raised by the petitioner. As per the original asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e functioning, generating and other technical aspects of wind electric generators. Since the concept of wind turbine was new in India, and as such, considerable amount of finance was required to be invested in it s purchase by the prospecting buyers, they wanted to have a detailed information about the product. They also wanted to know as to how, the Vestas product was a better bargain over other manufacturer product, in terms of it s yield and life. The assessee company thought it fit to install it s own turbines to demonstrate them to it s prospecting buyers, which was also very much within the main objects as defined in the Memorandum of Association of the Company. The installation of the above said demo units resulted positively, as this step yielded rich dividends to the assessee, resulting into much enhanced income thereafter. There is also no denying a fact, that the assessee s basic and original source of income is earning commission on the sale of wind electric generators, and there is a clear cut nexus between the above said expenditure incurred ( which relates to business promotion activity of the assessee) and the purpose of business carried on by the assessee. Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claim. The petitioner thereafter filed an appeal before the CIT (A) and it has been held that the deduction under Section 80IA as claimed by the petitioner company in the return should be allowed. It is, therefore, clear from the aforesaid facts that at the time of original assessment the question whether or not the assessee was not entitled to deduction under Section 80IA was specifically considered and examined by the Assessing Officer. The assessee was asked to give details and justify the deduction under the said section. 12. It is now well settled that the Assessing Officer cannot re-open assessment on issues which have been examined and considered at the time of original assessment. The Supreme Court in the case of Commissioner of Income Tax v. Kelvinator of India Ltd., (2010) 320 ITR 561 (SC) has held as under: On going through the changes, quoted above, made to section 147 of the Act, we find that, prior to the Direct Tax Laws (Amendment) Act, 1987, reopening could be done under the above two conditions and fulfilment of the said conditions alone conferred jurisdiction on the Assessing Officer to make a back assessment, but in section 147 of the Act (with effect from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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