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TMI Blog2016 (1) TMI 458X X X X Extracts X X X X X X X X Extracts X X X X ..... n deleting the addition made on account of disallowance of deduction u/s 80IC at Rs. 1,50,09,117/- as the assessee did not qualify for 'substantial expansion' as defined in Section-80IC(8)(ix) of the Income Tax Act, 1961. 3. That the appellant craves leave to add or amend any one or more of the grounds of appeals, as stated above, as and when need to do so arises with the prior permission of . the Court." 2. The facts in brief born out from the orders of the lower authorities are that the assessee has filed e-return, declaring total income of Rs. 24,14,81,160/- and the assessment was completed u/s 143(3) of the Act, assessing the total income of Rs. 24,19,80,973/-. Having formed a belief on the basis of assessment framed for the AY 2010-11 that the assessee does not disclose the complete facts necessary for the AY 2009-10 and has wrongly claimed deduction u/s 80IC of the Act for AY 2009-10 in respect of Sitarganj Unit, the Assessing Officer issued notice u/s 148 of the Act and reopened the assessment. In compliance of notice u/s 148 of the Act, the assessee submitted that the return of income already filed on 30.09.2009 for AY 2009-10, may be treated to be incompliance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax audit report and separate financial statement in respect of Sitarganj Unit filed before him. The relevant observations of the CIT(A) is hereunder for the sake of reference: "I have examined the reasons recorded u/s 147 of the Act for issue of notice u/s 148, finding given by the A.O. in assessment order and written submissions of appellant finding during appellate proceedings and assessment records of Assessment Years 2009-10 & 2010-11, and various judicial pronouncements as quoted by the appellant in respect to change of opinion as well as filing of audit report . On examination of the records it has been observed that the A.O. has initiated proceedings u/s 147 of the Act without proper verification of facts of appellant case and papers/documents including tax audit report and report of auditor in form No. 10CCB in respect of claim of deduction u/s 80IC of the Act of Rs. 1,50,09,117/- filed during the original assessment proceedings. During the appellant proceedings the appellant was directed to furnish all evidences to prove the correctness and genuineness of the claim u/s 80IC of the Act of Rs. 1,50,09,117/- . In compliance to said query raised the appellant has again fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 801C of the Act of same Sitarganj Unit in A.Yrs. 2009-10, 2010-11 & 2011-12. The report for deduction u/s 801C of the Act in Form No. 10CCB of I.T. Act again filed by the appellant during reassessment proceedings. Both reports filed in form no. 10CCB are available in relevant assessment folder. Since the A.O. himself allowed the claim of deduction u/s 80IC after verification from relevant records i.e. copy of ITR of appellant, relevant tax audit reports & notes of accounts given in tax audit report etc. as mentioned above in A.Yrs. 2009-10,2010- 11 & 2011-12, therefore, there was no reason to withdraw the claim u/s 80IC which was allowed in original assessment proceedings of A.Y. 2009-10. The A.O. has mentioned in the reasons recorded u/s 147 of the Act that substantial expansion did not take place in appellant case during the assessment year under consideration. As evident from facts available on record and tax audit report and other relevant papers/documents in respect of manufacturing and sales of product from Sitarganj Unit established that the production and sales were duly effected in assessment year under consideration and the appellant has earned profit from Sitarganj Unit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er contended that though in AY 2011-12, the claim of the assessee was allowed but the assessment was not reopened by the AO u/s 148 of the Act. Ld. counsel for the assessee further contended that the Assessing Officer has recorded all the facts wherefrom it is clear that the reopening was done on account of change of opinion. 5. On merit, Ld. counsel for the assessee has contended that there was no requirement of law to file a separate tax audit report for the unit on which deduction is claimed. One consolidated tax audit report is sufficient to claim the deduction u/s 80IC of the Act. At the most in order to demonstrate the expansion of the unit, individual financial statement may be filed. The assessee has furnished the requisite information before the Assessing Officer in order to establish that there was no opening balance of plant and machinery in Sitarganj undertaking and the entire amount reflecting as gross book value is on account of additions aggregating to Rs. 37,52,759/- made to plant & machinery alone in the relevant financial year. Ld. counsel for the assessee has also placed reliance upon the following judgments in support of his contention that once the claim of de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing the deduction claimed u/s 80IC of the Act to the assessee. In this order also there was no detailed discussion in this regard. 8. Though the assessment was reopened on 17.06.2013 for AY 2009-10, but no interference was made in the assessment order passed in AY 2010-11 on 22.12.2012 allowing the deduction u/s 80IC of the Act. It is also evident from record that other in AYs 2011-12 and 2012-13 deduction u/s 80IC was allowed and in the order for AY 2011- 12 the AO himself has observed that Assessing Officer has made an enquiry while allowing the claim of deduction u/s 80IC for AY 2010-11. Meaning thereby, while framing the assessment for AY 2010-11 on 22.12.2012, the Assessing Officer has applied his mind to claim of deduction raised by the assessee u/s 80IC of the Act where the Assessing Officer himself has applied his mind to the claim of deduction by making necessary enquiry before reopening the assessment in AY 2010-11, the reopening for AY 2009-10 appears to be on the basis of change of opinion. It is also obvious from the record that during the course of reassessment proceedings, assessee has filed the consolidated tax audit report along with financial statement of the Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come and after considering the same, the deduction u/s 80HH was allowed on interest income, dividend income and rental income in the original assessment and, hence, mere change of opinion does not constitute information within the meaning of section 147 of the Act. 10.3 In the case of CIT Vs. Vaishali Avenue reported in 48 taxmann.com 289 (Rajasthan) it was again held that where all facts relating to amount taken to balance sheet as provision for project developments and registration charges on sale of plot were available before Assessing Officer at time of framing of original assessment, reopening of assessment by successor Assessing Officer could not be sustained. 11. In the light of aforesaid judgments turning to the facts of the instant case, we find that assessee has furnished the consolidated tax audit report and financial statement and the notes claiming deduction under section 80IC of the Act. During the course of assessment proceeding and thereafter claim was allowed in other assessment years. Now, the Assessing Officer has taken a different stands for reopening the assessment without looking into the fact that in succeeding year the claim of deduction u/s 80IC of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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