9911796707
TMI Blog2015 (9) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... eted on the addition u/s. 41(1) of interest waived by the banks. 2. Briefly stated, assessee-company is engaged in the business of processing and polishing of rough dimensional granite blocks and other slabs and sale of polished granites, filed its return of income for the AY. 2005-06 declaring loss of Rs. 96,63,190/-. Assessing Officer (AO) completed the assessment originally on 31-12-2007 determining loss of Rs. 69,51,466/-. The AO subsequently, noticed that assessee has credited an amount of Rs. 11.58 Crores as prior period item and this amount has not been disclosed fully and truly as cessation of payment under One Time Settlement Scheme for this assessment year and came to a conclusion that income as escaped assessment. A notice u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of opinion' and there is no 'tangible material' available with the A.O. to reopen the assessment. I am, therefore, of the considered opinion that the initiation of proceedings u/s. 147, in the facts and circumstances of the case, is not correct and the consequent assessment made u/s. 143(3) rws 147 is therefore not sustainable in law and quashed". 4. Coming to the merits, he has examined the issue with reference to Remand Report called from the AO and concluded as under: "6.5 I have carefully considered the submissions of the appellant, remand report and the assessment order. Similar issue has come up before my predecessor in the appellant's own case for the assessment year 2003-04. A relevant extract from this order dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellate Tribunal is that 'when this impugned interest is not actually allowed as deduction in earlier years while computing the book profit, the same cannot be brought to tax in this assessment year while computing the book profit u/s. 115JB of the Act....." 7.1 Respectfully following decisions of the Hon'ble ITAT and my predecessor mentioned above, I hold that the A.O. was not justified in adding the amount of interest waived of Rs. 11.58 Crores in the computation u/s. 115JB as well as under the normal provisions. Hence, the addition of Rs. 11.58 crores is deleted". 5. Revenue is aggrieved. The only ground raised before us by the Revenue is with reference to reopening of the assessment and not on merits of the addition made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ven at the time of reopening the assessment. 8. We were also surprised to see from the record that similar issue arose in AY. 2002-03 and consequent to the directions of the ITAT, AO vide his order dt. 29-11-2013 has given a finding that question of claim of deduction of interest in the computation of total income does not arise. Vide para 6.3 of the order for AY. 2002-03, AO has this to record "In the instant case, the assessee company was granted the benefit of waiver of accumulated interest of Rs. 7,22,32,678/- shall remain unpaid for certain reasons that business of the assessee was not encouraging. Further, it has not claimed the said interest in any of the earlier assessment years. Even the claim made by assessee in the AYs. 1990-91 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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