TMI Blog2014 (4) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... he proviso will not bar the re-opening u/s 147 and will not be applicable – the entire issue of deciding the validity of re-opening and on merits, is required to be remitted back to the CIT(A) – thus, the matter is remitted back to the CIT(A) for fresh consideration – Decided in favuor of Revenue. Appeal not decided on merits – Reopening u/s 148 not proper – Held that:- Since the matter is already remitted back to the CIT(A) to decide the issue of validity of re-opening u/s 147 on other objections of the assessee and also to deal and decide the issue on merits – thus, the assessee’s grounds are also remitted back to the CIT(A) – Decided in favour of Assessee. - ITA No. 1467/Mum./2011, C. O. No. 173/Mum./2013 - - - Dated:- 28-3-2014 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s determined. Later on, the assessee s case was reopened by issuance of notice dated 18th August 2008, under section 148, after recording the following reasons :- The return of income was filed on 10/10/2005 declaring total loss of Rs. 20,46,962. The same was processed u/s 143(1) on 22/2/2007 at a total loss of Rs. 20,46,962 resulting in refund of Rs. 10,75,420. 2. As per Profit Loss account the np is shown at Rs. 39,32,184 which includes dividend of Rs. 60 lakhs. This amount is claimed as deduction being exempt u/s 10(34) of the I.T.Act. Proportionate amount of expenses relating to earning of dividend income which does not form part of the taxable income was incurred to be disallowed u/s 14A of the I.T. Act. The proportionate exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdingly, the assessment order is invalid. The relevant observations of the learned Commissioner (Appeals) are as under:- 4. It has been contended that only on the ground of disallowance u/s 14A of the Income Tax Act, assessment could not have been reopened u/s 147 since such an action is prohibited by the proviso to section 14A of the Income Tax Act. 5. I have perused the facts of the case and I find the contention to be correct. The statute categorically specifies that merely on the ground of disallowance u/s 14A, an assessment cannot be reopened. In the present facts of the case the only issue for reopening of assessment is the disallowance u/s 14A which is apparent from the plain reading of the reasons recorded in the assessment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e based on some cogent material and in this case, there is no new material which has come into the possession of the Assessing Officer. On the same set of existing facts, re-opening cannot be done. In support of this contention, he relied upon the following decisions of the Tribunal; (a) Delta Airlines Inc., ITA no.3476/Mum./ 2008, order dated 30th November 2012; (b) H.V. Transmission Ltd., ITA no.2230/Mum./2010, and the following decision of the Gujarat High Court in Inducto Therm India Pvt. Ltd. v/s CIT, in Special Civil Application no.858 of 2006, order dated 6th August 2012, and the decision of Delhi High Court in CIT v/s Orient Craft Ltd., [2013] 354 ITR 536 (Del.). He further submitted that the Assessing Officer, though has re-opened ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f it, is unsustainable, because the proviso is applicable only for the assessment year beginning on/or before 1st April 2001. This, inter-alia, means that the proviso will not be applicable for the assessment years beginning from 1st April 2002. The relevant proviso to section 14A, is reproduced herein below:- Provided that nothing contained in this section shall empower the Assessing Officer either to reassess under section 147 or pass an order enhancing the assessment or reducing a refund already made or otherwise increasing the liability of the assessee u/s 14 for any assessment year beginning on or before the 1st day of April 2001. 8. Thus, the aforesaid proviso clearly provides that the restriction or the bar to re-open the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no.173/Mum./2013, for the assessment year 2005-06. 10. In the said cross objection, the assessee has raised the grounds on merits of various additions which have been made by the Assessing Officer. The learned Commissioner (Appeals) has decided the issue of re-opening under section 148 and not decided the appeal on merits. Since in the Revenue s appeal, we have already restored the issue back to the file of the learned Commissioner (Appeals) to decide the issue of validity of re-opening under section 147 on other objections of the assessee and also to deal and decide the issue on merits, therefore, the grounds raised in the cross objection are also restored to the file of the learned Commissioner (Appeals) to decide these grounds on meri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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