TMI Blog2015 (9) TMI 1427X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT (Appeals) had directed the Assessing Officer to verify this aspect and give the assessee due relief - Decided against assessee - ITA No. 118/Chd/2015 - - - Dated:- 29-9-2015 - SHRI H.L.KARWA, VICE PRESIDENT AND MS. RANO JAIN, ACCOUNTANT MEMBER For the Appellant: Shri B.K.Nohria For the Respondent: Shri S.K. Mittal, DR O R D E R PER RANO JAIN, A.M. : This appeal filed by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals), Panchkula dated 28.11.2014 for assessment year 2008-09. 2. Briefly, the facts of the case are that the assessee filed its return of income for the relevant assessment year as on 1.10.2008 declaring income of ₹ 2,70,18,880/-. The assessment under section 143(3) of the Income Tax Act, 1961 (in short the Act ) was made vide order dated 24.12.2010 at an income of ₹ 5,35,46,930/-. Later on, after recording reasons to believe, the Assessing Officer issued a notice under section 148 of the Act to the assessee as on 14.2.2013. The reasons for reopening were that the Assessing Officer noted that the assessee has claimed expenses of ₹ 17.56 lacs for the financial ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings under section 147 of the Act. Ground Nos.6 and 7 are against the merits of the case while ground No.8 is general in nature. 5. Though five grounds of appeal are raised against the proceedings initiated under section 148 of the Act, however, very detailed submissions were made before us only on the issue that reopening of assessment under section 148 of the Act were bad and liable to be quashed as the same were made on the basis of objections raised by the Audit Party. The learned counsel for the assessee during the course of hearing before us, raised an objection that the notice issued on the basis of audit objection for the assessment year 2008-09 was bad in law. For this, we were taken to number of pages appended with the Paper Book filed by the assessee, whereby the copies of audit objection and its disposal were annexed. These evidences were shown to us to emphasize that the audit objections raised by the Audit Party was the only basis for reopening. Reliance was placed on the judgment of the Hon'ble Supreme Court in the cases of CIT Vs. Lucas T.V.S. Ltd. (2001) 249 ITR 306 (SC) and also Indian Eastern Newspaper Society Vs. CIT (1979) 119 ITR 996 (SC) for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd sought the comments of the AO, the AO has replied that it would be looked into at the time of regular LAR. I do not find any infirmity in the action of the AO on this ground as the information before the AO can be available from various sources, any other proceedings, from any other office which only provides the background for recording the reason to believe that income has escaped assessment. The appellant has relied on few judgments. On perusal of those judgments, it is noted that the decisions given were distinguishable on the facts than the facts of the instant case. The decision of Hon'ble Supreme Court in the case of Lucas TVS Ltd. (supra) was on the fact that the auditor's opinion in regard to application or interpretation of law cannot be treated by AO as information for reopening of the assessment. The decision of Hon'ble Supreme Court in the case of Indian and Eastern Newspaper Society (supra ) followed by Hon'ble P H High Court in the case of Sant Ram Mangat Ram was on the fact that information before the AO was available on account of internal audit of the Income Tax Department on the interpretation of law. However, in the instant case, the informati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to earlier years have been claimed in the current assessment year, which are not so allowable as per law. This information in the form of objection raised by the Audit Party, to the Assessing Officer, only provides the background for forming a belief that the income had escaped assessment. This is not an interpretation of law made by the Audit Party. This is just a factual error pointed out by the Audit Party. In this background, we hold that reopening on the basis of audit objection is as per law in the given facts and circumstances of the case and the learned CIT (Appeals) has very aptly analyzed the validity of notice under section 148 of the Act and we do not find any infirmity in the findings recorded by the learned CIT (Appeals). Therefore, we uphold the order of the learned CIT (Appeals) on this account. 9. On the merits of the case, the learned counsel for the assessee submitted that the assessee is paying service charges for the purchase of gunny bags to the Food Supply Department of Government of Haryana, who buys the gunny bags for use of State of Haryana at lower rates and charges at 1% of the purchase. It is submitted that it is not a tax, by whatev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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