TMI Blog2012 (11) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... angible material should be there. In the present case, it is a fact that that the reassessment was completed on 03/07/2006 and subsequently, another notice u/s 148 was issued 17/03/2008. The reassessment was completed on 28/11/2008 denying the deduction u/s 80HHE to the assessee for the reason that she was not engaged in the business of export of software and that she was merely a software consultant providing services to the overseas client. In earlier reassessment completed on 03/07/2006, the Assessing Officer had thoroughly examined the material available on record and the agreement was available, hence, the subsequent reassessment was merely a change of opinion - Reassessment made by the Assessing Officer u/s 147 is without jurisdiction and, therefore, the same invalid - In the result, appeal of the assessee is allowed. - ITA Nos. 2222/HYD/2011 and 2223/Hyd/2011 - - - Dated:- 8-6-2012 - SHRI CHANDRA POOJARI, AND SMT. ASHA VIJAYARAGHAVAN, JJ. Appellant by : Mr. A.V. Raghuram Respondent by : Mr. Gangadhar Panda ORDER PER ASHA VIJAYARAGHAVAN, J.M.: Both these appeals filed by the assessee are directed against the orders of the CIT(A)-VI, Hyderabad dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the interest income from the computation of deduction u/s 80HHE, that the agreement on the basis of which the deduction had been claimed was part of the assessment record in the proceedings u/s 143(3) itself, that there was no new material for the Assessing Officer s conclusion that income had escaped assessment and that under the circumstances, there was merely a change of opinion and not reason to believe for the Assessing Officer. The AR relied on the decision in Kelvinator India Ltd., 320 ITR 561 (SC). The AR also submitted that the reasons recorded by the Assessing Officer did not mention the specific words to the effect that he had reason to believe that income had escaped assessment and without these specific words, the reopening was rendered invalid. After considering the submissions of the assessee, the CIT(A) held as under:- 3.3 i have considered the submissions of the AR. It is pertinent to note that the notice u/s 147 has been issued in this case on 17/03/2008, i.e. within a period of four years form the end of the assessment year. The restrictions on the Assessing Officer are, therefore, to that extent limited. There is no doubt that the reopening has been don ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting of the Assessing Officer does not render the reasons recorded void ispo facto. This argument of the AR is, therefore, rejected. In view of the above findings and analysing the issue with case laws, the CIT(A) upheld the reassessment made by the Assessing Officer u/s 148 of the Act. 7. Aggrieved by the order of the CIT(A), the assessee is in appeal before us raising the following grounds of appeal:- 1. The order of the CIT(A) dismissing the appeal is not only perverse but also is erroneous both on facts and in law in so far as it is prejudicial to the assessee. 2. The learned CIT(A) erred in upholding the action of the Assessing Officer in initiating proceedings u/s 147 in spite of the decision of Supreme Court in the case of Kelvinator India Ltd., reported 320 ITR 561. 3. The CIT(A) ought to have appreciated the fact that no Assessing Officer could have allowed the deduction claimed u/s 80 HHE without examining the eligibility to claim such deduction and thereby erred in holding that the Assessing Officer has not examined the nature of services before allowing such deduction though once a reassessment is made only to restrict the deduction u/s 80 HHE and thereby ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... completed on 28/11/2008 u/s 143(3) r.w.s.147. Hence, all the materials were made available to the AO and the AO had applied his mind during the earlier reassessment made on 03/07/2006 itself. 10. In the present case, in the reassessment made on 03/07/2006, the Assessing Officer had applied his mind with respect to the agreement, which was not so, in the cases relied upon by the CIT(A). In this connection, we refer to the decision of the Hon ble Delhi High Court in the case of Kelvinator India Pvt. Ltd., 256 ITR 1(Del.) (F.B), on which reliance was placed by the learned counsel for the assessee, wherein the Hon ble Delhi High Court held as under:- In the event it is held that by reason of section 147 of the ITO exercises his jurisdiction for initiating a proceeding for reassessment only upon a mere change of opinion, the same may be held to be unconstitutional. We are therefore of the opinion that section 147 of the Act does not postulate conferment of power upon the Assessing Officer to initiate reassessment proceeding upon his mere change of opinion. We, however, may hasten to add that if reason to believe of the Assessing Officer is founded on an information which might ..... X X X X Extracts X X X X X X X X Extracts X X X X
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