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2016 (5) TMI 529 - ITAT DELHI

2016 (5) TMI 529 - ITAT DELHI - TMI - Reopening of assessment - Held that:- The original assessment proceedings, once the questionnaire/queries stood replied by assessee on each and every aspect of the case, reopening of assessment will amount to change of opinion, has also not been rebutted by the Revenue before us. Therefore, in view of several decisions relied on by the ld. CIT(A) in the impugned order, as well as by assessee before us, the re-assessment proceedings have rightly been held as .....

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ntant Member: This appeal by the Revenue arises out of the order dated 19.09.2013 of ld. CIT(A)-VIII, New Delhi for the assessment year 2004-05 on the following grounds : 1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that the action of AO in reopening assessment u/s. 147/148 is not correct ? 2. Whether on the facts and in the circumstances of the case & in law, the Ld. CIT(A) has erred in deleting the addition of ₹ 39,53,226/- .....

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essment in this case was completed under section 143(3) at income of ₹ 15,87,44,340/-. Scrutiny of income tax assessment records revealed that the assessee claimed an expenditure of ₹ 1033.52 lacs on account of 'bank guarantee , though as per the 3CD Report this being in nature of contingent liability should have been disallowed. The mistake resulted in under assessment of income of ₹ 1033.52 lacs involving tax effect of ₹ 493.12 Lacs. 02. It is also revealed that the .....

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26/- aggregating to ₹ 10,73,05,226/- chargeable to tax has escaped assessment within the meaning of section 147 /148 of the income Tax Act, 1961. In response to the notice u/s. 148, the assessee filed its reply stating that the return already filed be treated as the return filed in response to notice u/s. 148 of the Act. The assessee also filed written submissions after obtaining the reasons recorded. After considering the submissions of the assessee, the Assessing Officer did not take any .....

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xpense only when it has been shown as an income in the relevant previous year or an earlier previous year, but in the instant case, the assessee has not shown that the bad debts written off claimed as an expense were shown as an income in an earlier previous year. In view of this, the AO made addition of ₹ 39,53,226/- after disallowing the bad debts written off relating to prior period. The assessee challenged the reassessment order in appeal before the ld. CIT(A) where the assessee object .....

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ted that wrong interpretation of accounts by the AO leading to excessive relief cannot be a ground for reopening and thus, cannot confer jurisdiction on the AO to reopen the assessment. It was also submitted that merely on the basis of change of opinion, reopening proceedings are not valid. The assessee also challenged the addition made by AO on merits. It was also submitted that the AO did not apply his mind before reopening of assessment inasmuch as the prior period expenses calculated by the .....

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t now that reopening u/s 147 cannot be initiated on a mere change of opinion. From the perusal of notice u/s 142 (1), various details and explanations sought which were duly replied along with all the details and were filed before the AO. It is seen that all these documents are part of assessment record. The AO cannot agitate those issues again unless there is incorrect statement or material fact is concealed. The AR has rightly agitated that this assessment relates to AY 2004-05 which was compl .....

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₹ 36,85,691/-. This shows that AO did not apply his mind and merely acted on the direction of the audit team. This is not permissible in law. Further after going through the assessment order, 1 did not find any observation of the AO to conclude that assessee has not disclosed fully and truly all material facts necessary for his assessment. I find that the assessee has placed all material facts before the AO in the original assessment proceedings. The AO being satisfied did not raise any qu .....

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39;ble SC in the matter of CIT vs. Kelvinator India 320 ITR 561 have already held that reopening is not permissible merely on the basis of change of opinion. Hon'ble SC have also held that one of the major reasons for taking such a view also appears to be the fact that if the AO is permitted to reopen the assessment on a mere change of opinion section 147 would give arbitrary powers to the AO to reopen the assessment. Respectfully following the decision I am fully in agreement with the argum .....

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10-TIOL-31- SC-IT copies of which is filed before Respectfully following these decisions, I also hold that after the amendment to section 36 (1) (vii) assessee is entitled to claim deduction of any bad debts which is written off as irrecoverable in the accounts of the previous year. Hence, ground no. 2 is also allowed on merits. The appellant or any tax payer can write off bad debt in the same year in its accounts under Section 36(1) (vii), and if recoverable at a later stage, he will show this .....

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t appellate order. On the issue of validity of re-assessment proceedings, the ld. Counsel for the assessee has relied on various decisions on various aspects of the case. 4. We have considered the rival submissions and have perused the entire material available on record and we find no justification to interfere with the findings reached by the first appellate authority in the impugned order. The ld. DR could not adduce any material on record to rebut the contention of the assessee that the impu .....

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