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2016 (4) TMI 78 - ITAT MUMBAI

2016 (4) TMI 78 - ITAT MUMBAI - TMI - Validity of reopening of assessment - Wrong claim of bad debt and foreign exchange gain - Held that:- Re-assessment proceedings u/s.148 in its case are barred by limitation due to the proviso of sec.147 of I.T.Act. It is noted that though the AO has claimed that the income has escaped assessment during the year on account of wrong claim of bad debt and foreign exchange gain, but it is worth noting that during the original assessment the then A.O. has specifi .....

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A.O. in the original assessment. Therefore, under these circumstances it appears that there has been no omission/failure on the part of the appellant to disclose any material fact. In the reasons recorded by the A.O. also it is not mentioned that the appellant has not disclosed any material facts. - Decided in favour of assessee - ITA No. 30/Mum/2014 - Dated:- 12-2-2016 - B. R. Baskaran, AM And Amarjit Singh, JM For the Appellant : Shri S K Mishra For the Respondent : Shri Sanjay R Parikh ORDER .....

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143(3) of the Act on 23.10.2007. Thereafter the AO reopened the assessment by issuing notice u/s 148 on 30.03.2012, i.e., after the expiry of four years from the end of the assessment year for disallowing the following claims that were allowed in the original assessment proceedings:- (a) Bad debts claim of ₹ 348 lakhs (b) Loss from foreign currency transactions - ₹ 29.74 lakhs The AO completed the reassessment by disallowing both the items cited above. 3. Before Ld CIT(A), the asses .....

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n to the notice dated 14th June, 2007, issued and served another notice on the Appellant Company to file details and tender its submission on certain issues. Among the issues raised in the said notice, the Appellant Company wishes to highlight issue no. 2 and 7 raised by the Ld. AO and reproduces the same ad verbatim herein below: 2) As per Directors Report, you have claimed one time write off of doubtful debts of ₹ 3,71,03,347/- in the outdoor business. You are required to file justificat .....

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e is no failure on the part of the assessee to furnish all the material information relating to the above said additions truly and fully and hence the reopening of the assessment was bad in law. The assessee, in this regard, has taken support of the first proviso to sec. 147 of the Act. The Ld CIT(A) agreed with the said contentions of the assessee and accordingly quashed the reassessment order. Aggrieved, the revenue has filed this appeal before us. 4. We heard the parties and perused the recor .....

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not. "147.... Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year92, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-sectio .....

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of the Act is satisfied, meaning thereby the reopening has been done on change of opinion, which is not permissible. 5. We notice that the Ld CIT(A) has addressed this issue in proper perspective and for the sake of convenience, we extract below the decision rendered by Ld CIT(A). "5. Decision: 5.1 I have carefully and dispassionately considered the facts and circumstances of the case, statement of facts, relevant assessment order, relied upon case laws by the LAR, written submission and th .....

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