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2015 (10) TMI 1882 - ITAT KOLKATA

2015 (10) TMI 1882 - ITAT KOLKATA - TMI - Reopening of assessment - assessee had claimed loss by trading in its own shares - CIT(A) quashed reassessment proceedings - Held that:- Reassessment proceeding was initiated for re-appraisal of the facts already on record and this was clearly a case of mere change of opinion. No fresh tangible material came to Assessing Officer’s possession to justify the initiation of reassessment proceedings and the details regarding amalgamation were already on recor .....

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Kelvinator of India Limited reported in [2010 (1) TMI 11 - SUPREME COURT OF INDIA ], the reassessment proceedings were bad in law, which rightly cancelled by the ld. CIT(Appeals). We accordingly confirm the order of ld. CIT(Appeals) on these observations. - Decided in favour of assessee. - I.T.A. No. 100/KOL/ 2012 - Dated:- 12-8-2015 - Shri S.V. Mehrotra and Shri Mahavir Singh, JJ. For The Department : Shri Subhrajyoti Bhattacharjee, JCIT, Sr. D.R. For The Assessee : Shri D. S. Damle, FCA Per S .....

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orrect in allowing long term capital loss of ₹ 3,25,52,531/-. 2. Brief facts of the case are that the assesese-Company filed its return of income showing a total loss of ₹ 4,85,00,762/-. The assessment was completed under section 143(3) determining total income of ₹ 5,80,973/- vide order dated 30.11.2006. Subsequently the Assessing Officer issued notice under section 148 on 22.06.2007 for the following reasons:- (1) Service charges receiv ed of ₹ 16,46,910/- have been ass .....

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s has booked a long term capital loss of ₹ 3,25,52,531/-. From the assessment records of AY 2003-04, it is also seen that the companies which were holding long term capital loss of ₹ 3,25,52,531/-. From the assessment records of AY 2003-04, it is also seen that the companies which were holding these shares had already amalgamated with the assessee company prior to the financial year relevant to AY 2004-05. Hence, the transactions by the assessee company in its own shares are not perm .....

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th section 147 at a total income of ₹ 5,80,973/-. However, the Assessing Officer disallowed the assessee s claim for carry forward loss of long term capital gain in assessee s hand. 3. Ld. CIT(Appeals) cancelled the re-assessment proceedings for the following reasons:- (i) In the course of regular assessment under section 143(3), sufficient material was available with the assessing Officer and he did not draw any adverse inference against the assessee. Sufficient information and documents .....

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e fact s al ready on record at the time of passing of the order under section 143(3). (ii) The re-opening of assessment could not be done on the basis of mere change of opinion within four years from the end of the relevant assessment year in view of the decision of the Hon ble Supreme Court in the case of Kelvinator of India Limited reported in 320 ITR 561(SC) as well as the decision of the Hon ble Calcutta High Court in the case of Amrit Feeds Limited -vs.- ACIT, Circle-2, Kolkata reported in .....

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le of its own shares by transferee companies, which were transferred just prior to the appointed date. He referred to pages 26 to 28 of the paper book wherein the quest ionnaire dated 19.10.2006 is contained and pointed out that the Assessing Officer only required the assessee to furnish contract notes in respect of the sale of shares. He, therefore, submitted that the ld. CIT(Appeals) erred in holding that it was a case of change of opinion. 5. Ld. counsel for the assessee referred to pages 25 .....

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m capital loss amounting to ₹ 4,90,81,735/-, which, inter alia, included the loss in respect of shares of ISG Traders Limi ted amounting to ₹ 3,25,52,531/-. Ld. counsel further referred to pages 82 & 83 of the paper book, wherein the bills for sale of shares dated 09.05.2003 are contained. Ld. counsel further pointed out that the Assessing Officer has recorded reasons in respect of three items, as noted earlier, but it was only with reference to the third reason that the Assessin .....

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tly not considered at the time of filing of return of income. The assessee has submitted the details of this amount along with copies of contract notes and bills. In view of the details submitted by the assessee, the long term capital loss of ₹ 38,41,393/- is allowed to be carried forward . 5.2. Ld. counsel submitted that this shows that he had considered the long term capital loss claimed by the assessee in respect of amalgamating Companies. 6. We have considered the submissions of both t .....

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tice under section 142(1) specifically required the assessee to furnish cont ract notes in respect of sale of shares and, therefore, it is clear that he had duly applied his mind to the fact s on record. It is t rue that there is no specific mention of the shares of assessee- company held by amalgamating company on which loss was claimed by the assesese after amalgamation. But once Assessing Officer had considered the computation and raised queries in regard to sale of shares and further while p .....

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r was in possession of assessee s audited financial accounts for years ended on 31.03.2003 and 31.03.2004. In these accounts, the assessee had made disclosures about amalgamation of three companies in terms of the order of the Hon ble Calcutta High Court passed in May, 2003 by which three Companies were amalgamated ret rospectively from 01.03.2003 Copies of the contract notes and bills in support of sale of shares of ISG Traders Limited were filed before the Assessing Officer in the course of or .....

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