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TMI Blog2012 (7) TMI 337X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessment year 2004-05. b) On 29th November, 2010 the Respondent No.1 issued a notice under Section 148 of the said Act seeking to reopen the assessment for the Assessment year 2004-05. On 5th January 2011 the Respondent No.1 furnished to the Petitioner the reasons recorded by him for issuing notice dated 29th November, 2010 under Section 148 of the said Act. The reasons recorded for reopening of assessment for Assessment Year 2004-2005 are as under: "It is seen from the records that the assessee company had claimed deduction of depreciation of Rs.69,04,465/- which included depreciation of Rs.9,12,412/- on Goodwill. Goodwill is an intangible asset which has not been specified for allowance of depreciation nor it can be held to be of similar nature as know how, patents etc and hence is not a capital asset for which depreciation is allowed. Incorrect allowance of depreciation on Goodwill resulted in under assessment to the extent of Rs.9,12,412/.- Further the assessee had computed the taxable income of Rs.49,70,132/- and after set off of unabsorbed depreciation of Rs.3,34.091/- for A.Y. 2000-01 and Rs.16,23,554/-, offered Rs. 30,12,487/- for tax which was accepted by the A.O. Howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel submits 1) initiation of reopening under Section 148 of the said Act by Notice dated 29th November 2010 is completely without jurisdiction as the condition precedent to reopen assessment after the end of 4 years from the end of the relevant Assessment year in terms of proviso to Section 147 of the said Act is not satisfied. I.e. there was a failure on the part of the petitioner to disclose fully and truly all material facts necessary for assessment; 2) there was no tangible materail available with the respondent to reach a conclusion that there was a reasonable belief that income had escaped assessment The reasons recorded for reopening the assessment as well as the order rejecting the petitioner's objection dated 4th November 2011 proceed on the basis that the material on which reassessment is proposed was already on record at the time of the original assessment proceeding; 3) the only reason for reopening the assessment as well as the order rejecting the petitioner's objection to initiation of proceeding under Section 147/148 of the said Act is that the depreciation of goodwill and set off of unabsorbed depreciation was allowed erroneously for the Assessment year 2004-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t do not indicate any failure on the part of the petitioner to disclose fully and truly all material facts necessary for assessment. Further neither the reasons recorded for reopening the assessment nor the order dated 4th November, 2011 indicate that respondent No.1 is relying upon any tangible material which was not disclosed by the Petitioner truly and fully at the time when the assessment order dated 18th December,2006 was passed. Therefore, the jurisdictional requirement to reopen the assessment after more than four years from the end of the relevant assessment i.e. Assessment Year 2004-05 is not satisfied. In fact this Court in the matter of Hindustan Liver Ltd. v. R. B. Wadkar reported in 268 ITR Page 332 observed as under: "The reasons recorded by the Assessing Officer nowhere state that there was failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment of that assessment year, it is needless to mention that the reasons are required to be read as they were recorded by the Assessing Officer. No substitution or deletion is permissible. No additions can be made to those reasons. No inference can be allowed to be drawn ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n power to review and power to reassess. The power under Section 147 of the said Act is the power to reassess and not the power to review. 9. It was submitted that the issue regarding depreciation on goodwill and set off of unabsorbed depreciation was an issue considered by respondent No.1 in order dated 18th December, 2006 and was not reviewed by him. The only basis for the above submission is that the order of assessment does not discuss the issues raised for the purposes of reassessment. 10. This very issue as raised by the counsel for the Revenue has been considered by this court in the matter of Idea Cellular ltd. v. Deputy Commissioner of Income tax in 301 ITR 407 wherein it has been held as follows: "It was also sought to be contended that since the Assessing Officer had not expressed any opinion regarding this matter in his original assessment order, it could not be said that there was any change of opinion in this case. In our view, once all the material was before the Assessing officer and he chose not to deal with the several contentions raised by the Petitioner in his final assessment order, it cannot be said that he had not applied his mind when all the material was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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