TMI Blog2013 (5) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... e would only amount to change of opinion. Remedy of reopening the assessment, therefore, was simply not available. In the decision of the Supreme Court in case of Commissioner of Income Tax Vs. Kelvinator of India Ltd. reported in [2010 (1) TMI 11 - SUPREME COURT OF INDIA] it was held that if the Revenue was of the opinion that the AO erroneouly and to the prejudice of the interest of the Revenue allowed certain claim, in a given situation, it would have been open for the appropriate authority to exercise revisional powers. However, once the claim was fully examined, power of reopening was simply not available. In favour of assessee. - Special Civil Application No. 357 of 2013 - - - Dated:- 16-4-2013 - Akil Kureshi And Sonia Gokani, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 012, the respondent issued impugned notice. The petitioner was supplied reasons recorded for issuance of such notice which read as under: In this case on verification of case record it is noticed that the assessee is engaged in the business of contractor with different agencies. On verification of the P L account it is notice that the assessee has incurred total labour payment expenditure of Rs. 9,48,23,819/- out of which the assessee had deducted TDS on labour payment of Rs. 6,48,55,517/- and the balance labour payment amounting to Rs. 3,05,68,302/- was paid to other labour on which TDS was not deducted. Therefore as per section40(a)(ia) of the IT Act the expenditure would be allowed as deduction from the taxable income, only if ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s aspect of the matter but, having enquired with the assessee and having concluded that tax at source though required, was not deducted, made disallowance on ad-hoc basis which, according to the revenue, was not in order. Entire amount should have been disallowed from the claim of expenditure. 9. In addition to the above conclusions, we also notice that in the assessment order itself, the Assessing Officer had discussed this issue in following manner: 6. Disallowance out of labour payments: During the year under consideration, the assessee had incurred total labour payment expenditure of Rs. 9,48,23,819/-. Out of this expenditure the assessee has deducted TDS on labour payment of Rs. 6,42,55,517/- and the balance labour payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ges. 11. Whatever be the legality of such assessment, fact remains that, in the scrutiny assessment, the Assessing Officer had thoroughly and fully scrutinized the assessee s claim of deduction of labour expenditure. To the extent he was inclined to disallow the same, he did so. By no stretch of imagination it can be stated that the issue was not at large before the Assessing Officer in the original scrutiny assessment. Any reexamination of such a question at this stage would only amount to change of opinion. Remedy of reopening the assessment, therefore, was simply not available. In the decision of the Supreme Court in case of Commissioner of Income Tax Vs. Kelvinator of India Ltd. reported in [2010] 320 ITR 561 (SC) the Apex Court obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after 1st April, 1989, Assessing Officer has power to re-open, provided there is tangible material to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief. Our view gets support from the changes made to Section 147 of the Act, as quoted hereinabove. Under the Direct Tax Laws (Amendment) Act, 1987, Parliament not only deleted the words reason to believe but also inserted the word opinion in Section 147 of the Act. However, on receipt of representations from the Companies against omission of the words reason to believe , Parliament re-introduced the said expression and deleted the word opinion on the ground that it would vest arbitrary powers in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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