TMI Blog2013 (8) TMI 972X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377; 12,28,14,579/- from the profits of the business before setting off unabsorbed business loss of ₹ 3,38,00,740/- and unabsorbed depreciation of ₹ 3,62,91,752/- relatable to non-eligible units. 2. Whether in the facts and circumstances of the case and in law, the Learned CIT(A) has erred in deleting the adjustment made in arriving book profit u/s 115 JB of the IT Act on account of income of which u/s 10A is applicable at ₹ 5,96,73,066/- after setting off of business allows and unabsorbed depreciation. 3. Whether in the facts and circumstances of the case and in law, the Learned CIT(A) has erred in allowing excess depreciation of ₹ 1,49,36,923/- claimed on account of revising the estimated life of assets, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We have heard the rival contentions and perused the material on record. As the facts emerge, AO while framing original assessment dated 27-3-2006 has considered the issue in detail of eligibility and quantification of deduction u/s 10A by various submissions made by the assessee. Besides, AO further decides the issue once again by order u/s 154 dated 1-5- 2006. There cannot be any doubt to the effect that AO has applied his mind to the whole issue and thereafter came to the conclusio0n and accordingly, he framed the original assessment as well as subsequent 154 order. We find merit in the arguments of the learned counsel that Hon ble Delhi High Court in the case of Kelvinator of India Ltd. (supra) has categorically held that an assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO at the time when the original assessment was made and the Assessing officer applied his mind to that material and accepted the view canvassed by the assessee, then merely because he did not express this in the assessment order, that by itself would not give him a ground to conclude that income has escaped assessment and, therefore the assessment needed to be reopened. On the other hand, if the Assessing officer did not apply his mind and committed a lapse, there is no reason why the assessee should be made to suffer the consequences of that lapse. 17. In so far as the present appeal is concerned, we find that the assessee had placed all the material before the Assessing officer and where there was a doubt, even that was clarified by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06 at book profit of ₹ 3,43,92,839/- and normal income of ₹ 29,62,940/-. In the return of income assessee claimed and was allowed deduction u/s 10A of ₹ 12,28,14,579/- before setting off unabsorbed depreciation and business loss of ₹ 6,27,61,064/- pertaining to the assessment year 2001-02. Thus, deduction of only ₹ 5,96,73,066/- was allowable to the assessee u/s 10A but assessee made the wrong claim. The mistake resulted in excess allowance and carried forward of loss of ₹ 6,27,61,064/- in the year under consideration. Further, as per Notes to Accounts, the assessee claimed and was allowed ₹ 1,49,36,923/- as a result of revising the estimated life of assets. This being an inadmissible expenditure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner to fully and truly lose all the material facts necessary for the petitioner's assessment, find that this aspect is clearly covered in favour of the petitioner by virtue of our decision in HW1Jana Acrylic (supra). In that case, we had observed as under: 29. In the reasons supplied to the petitioner. there is no whisper, what to speak of any allegation. that the petitioner had failed to disclose fully and truly all material facts necessary for assessment and that because of this failure there has been an escapement of income chargeable to tax. Merely having a reason to believe that income had escaped assessment, is not sufficient to reopen assessments beyond the four year period indicated above. The escapement of income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner having failed to disclose fully and truly all the material facts necessary for its assessment. Therefore. the necessary ingredients of the provisions of s. 147 are not satisfied. In view thereof. the Revenue cannot also raise the ground with regard to the expenses being of a 'capital' nature. whereas the petitioner had claimed it as 'revenue expenditure' . 7. Therefore. in whichever way we look at this case. we find that the initiation of reopening of the assessment pertaining to the asst. yr. 2004-05 did not have the backing of law. Consequently, the impugned notice under s. 148 and all proceedings pursuant thereto, including the assessment order passed pursuant thereto are liable to be set aside. It is ordered acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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