TMI Blog2015 (10) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... as there was a lack of enquiry and non application of mind on the part of the Assessing Officer while framing the assessment u/s 143(3) dated 16.12.2010. However, when the assessee in the revision proceedings has brought to the notice of Commissioner that the said claim is an allowable claim being ascertained liability based on actuarial valuation report and as per Accounting Standard 15 then the Commissioner was supposed to examine the claim on its own or ought to have directed the Assessing Officer to examine the same as there was no enquiry on this issue at the time of framing the original assessment u/s 143(3 ). The assessee has submitted that the pension scheme in question does not make any regular contribution to any fund or t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. The assessment was completed u/s 143(3) on 16.12.2010 whereby, the Assessing Officer assessed the total income of the assessee at ₹ 490.59 crores. Subsequently, on perusal of records, the Commissioner found that the assessee has charged a sum of ₹ 273.60 lacs to P L account, being the liability towards Pension Scheme whereas the tax audit report does not indicate whether the same was actually paid or not before due date of filing of return of income. Accordingly, the Commissioner has issued a showcause notice dated 30.01.2013 u/s 263 on the issue of disallowance u/s 43B of the Income Tax Act. In response the assessee filed detailed reply and contended that in order to retain the senior managerial employees, the assessee cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per the accounting standards (AS 15) and, therefore, the liability was ascertained on the basis of actuarial valuation report. He has further submitted that the assessee made the necessary disclosure and furnished all the requisite details before the Assessing Officer including the note to return of income as item no. 12, Schedule M of audited balance sheet and profit loss account and tax audit report which shows that the assessee has made all these provisions based on the ascertained liability as per the actuarial valuation report. The Assessing Officer has accepted the claim of the assessee while passing the assessment order u/s 143(3). Therefore, the revision order is bad in law as based on change of opinion. The Assessing Officer aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roneous for want of application of mind and lack of enquiry on the part of Assessing Officer. 5. We have heard the Ld. AR as well as Ld. DR and considered the relevant material on record. On careful perusal of the assessment order passed u/s 143(3) on 16.12.2010, we find that the Assessing Officer has not discussed anything about the claim of ₹ 273.60 lacs provided in the Books of Accounts as liability towards pension scheme. We are conscious that if the Assessing Officer has raised a query regarding a particular issue and after considering the reply and contentions of the assessee allowed the claim without any discussion the same would not lead to the conclusion that the Assessing Officer has not applied its mind. However, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invoking the provisions of section 263 as there was a lack of enquiry and non application of mind on the part of the Assessing Officer while framing the assessment u/s 143(3) dated 16.12.2010. However, when the assessee in the revision proceedings has brought to the notice of Commissioner that the said claim is an allowable claim being ascertained liability based on actuarial valuation report and as per Accounting Standard 15 then the Commissioner was supposed to examine the claim on its own or ought to have directed the Assessing Officer to examine the same as there was no enquiry on this issue at the time of framing the original assessment u/s 143(3 ). Instead of conducting a proper enquiry on the issue of allowability of the claim the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use had to be inserted by the Legislature as the Legislature was conscious of the fact that this clause would not be covered by the existing clause (b) of section 43B of the Act. 8. We are in agreement with the view of the Commissioner of Income-tax (Appeals) that the pension scheme of the assessee does not envisage any regular contribution to any fund or trust or any other entity. The pension scheme provides that pension would be paid by the appellant to its employees on their attaining the retirement age or resigning after having rendered services for specified years. Thus, where the liability on this account accrues from year to year, the same is payable on retirement/resignation of the eligible employees. In view thereof, the rati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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