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State Bank of Saurashtra Versus Dy. CIT Cir- 2 (2) Mumbai

2015 (6) TMI 241 - ITAT MUMBAI

Validity of reopening u/s 147 - proceedings initiated after the expiry of four years - Held that:- Such an assessment is being sought to be reopened without their being any failure on the part of the assessee to disclose folly and truly all material facts necessary for the assessment. Even in the “reason recorded”, the assessing officer has not ascribed any failure on the part of the assessee as to what is the failure on the part of the assessee in making the full disclosure. If the assessee has .....

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115/Mum/2011 - Dated:- 23-3-2015 - SHRI D. KARUNAKAR RAO AND SHRI AMIT SHUKLA, JJ. For The Assessee : Shri C. Naresh For The Revenue : Shri Kishan Vyas ORDER PER AMIT SHUKLA, JM: The aforesaid appeal has been filed by the Assessee against order dated 28.07.2011, passed by Ld.CIT-5 Mumbai for the quantum of assessment passed u/s 143(3) r.w.s. 147 for the A.Y. 2001-02. In various grounds of appeal, the assessee has mainly challenged the impugned order on following points:- i). Validity of reopenin .....

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e bank was later on merged with the State Bank of India on 13.08.2008. The return of income for the A.Y. 2001-02 was filed on 28.02.2002 at Nil after claiming set off OF carried forward losses to the extent of ₹ 59,61,23,649/-The said return was duly processed u/s 143(1) on 09.09.2002. Thereafter the assessee s case was selected for scrutiny and assessment order was passed u/s 143(3) vide order dated 22.03.2004 at an income of ₹ 80,99,67,030/-. Against the said order, the assessee ha .....

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t due on its investment in securities. However, in the return of income such interest is not offered to tax and only the interest which has become due and receivable during the year is offered to tax. From the A.Ys. 2003-04 onwards, such interest "Accrued but not due at the end of the year" was taxed by the Assessing Officer. Such additions have been confirmed and upheld by the CIT(A) in assessee bank s first appeal subject to the direction that the credit for similar amount of interes .....

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due as at end of assessment year Rs.826397428/- Less: Interest Accrued but not due as at beginning of assessment year Rs.662014992/- Net Difference Rs.164382436/- 4. Amount of accrued interest during the year ₹ 16,43,82,436/- which is to be added back and is taken as the income of the year and the same is required to be taxed accordingly. As a result of which income chargeable to tax has escaped assessment. 5. In view of the above, I have to reason to believe that income chargeable to tax .....

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on that reopening is bad in law in view of proviso to section 147 on the ground that AP had sufficient reasons to reopen the case. His finding in this regard are given in para 5 of the impugned order. 4. Before us, learned counsel submitted that in the computation of income filed along with the return of income, the assessee has duly disclosed the details of interest of securities chargeable to tax and also the details of interest accrued but not due at the end of the year. All these details wer .....

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ssessment proceedings. From the perusal of the reasons recorded , it can be seen that, merely because in the A.Y. 2003-04, the interest accrued but not due has been taxed by the AO and confirmed by the Ld. CIT(A), therefore, the completed assessment has been reopened for the A.Y. 2001-02. In the reasons recorded no failure has been ascribed on the part of the case. Thus reopening of the assessee is bad-in-law. In support of his contention, he strongly relied upon the decision of Hon ble Bombay H .....

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in the case of Dr. Amin s Pathology Laboratory Vs. JCIT reported in (2001) 252 ITR page 673. 6. We have heard rival submissions and also perused the relevant material on record qua the legal issue raised on reopening of case u/s 147. It is an undisputed fact that assessee s case was selected for scrutiny and assessment was completed u/s 143(3) and the reopening of such an assessment has been done after the expiry of four years from the end of the relevant assessment year. In such a case, time li .....

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t of the assessee to furnish the return u/s 139 or S. 142(1) or S. 148 and secondly, failure on the part of the assessee to disclose truly and fully all material facts necessary for the assessment. In this case, there is no failure on the part of the assessee to furnish the return u/s 139. So far as second condition is concerned, it is evident from the record that the assessee has duly disclosed all the details of interest due and receivable and interest due and accrued during the year not only .....

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urities 2,38,91,40,185 25,36,10,802 On Government Securities on other securities 1,43,09,438 11,36,86,944 Interest accrued upto 31.03.2000 but not due debited on 01.04.2000 received St. No. 9F attached to our return of income for AY 2000-01 59,78,82,999 6,41,31,993 ADD: On shares ADD: On Units of SBI Magnium ADD: On success fee 82,500 Sub total 2,98,70,23,184 31,77,42,795 12,80,78,882 Less: Interest accrued upto 31.03.2001 but not due (St No. 9F) 73,83,38,715 8,80,58,710 2,24,86,84,469 22,96,84, .....

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