TMI Blog2016 (5) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... Unilever Ltd. vs. Deputy Commissioner of Income-Tax (2010 (4) TMI 206 - BOMBAY HIGH COURT ) the Hon’ble Bombay High court has clearly held that the revenue had an efficacious remedy open to it in the form of a rectification under section 154 for correcting a computational error and consequently recourse to the provisions of section 147 was not warranted. Also excessive claim on account of brought forward depreciation was sought to be rectified by the re-opening of the entire assessment is also against the ratio laid down by the Hon’ble Jurisdictional High Court in the above decision. In the case of J.C. Thakkar vs. CIT [ 1955 (2) TMI 9 - BOMBAY HIGH COURT ] We, therefore annul and quash the re-opening of the assessment u/s 147 of the Act and consequent reassessment order without going into the merit of the case and . - Decided in favour of assessee - I.T.A. No 3627/Mum/2013 - - - Dated:- 26-2-2016 - Shri C. N. Prasad, JM And Shri Rajesh Kumar, AM For the Appellant : Shri Nitesh Joshi For the Respondent : Shri R.A. Dhyani ORDER Per Rajesh Kumar, A. M This appeal by the revenue is directed against the order dated 28.02.2013 of Commissioner of Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee was selected for scrutiny and the assessment was framed u/s 143(3) vide order dated 24.12.2008 at Rs. Nil under the normal provisions of the Act and at ₹ 31,25,75,720/- u/s 115JB of the Act by making various disallowances including disallowance u/s14A however the claim of the assessee in respect of brought forward depreciation for AY 20001-02 of ₹ 4,23,73,057/- was accepted. Thereafter the assessment order was appealed before the CIT(A) and Tribunal and ultimately Tribunal set aside the issue to the file of the AO to make reasonable disallowance u/s 14A after relying on the case passed by the jurisdictional High Court. 3. The case of the assessee was re-opened u/s 147 r.w.s. 148 of the Act and notices u/s 148 was issued by the assessee after recording the reasons u/s 148(2) which were incorporated by the AO in para 2 of the assessment order dated 30.12.2011 stating that the assessee was allowed excess claim of unabsorbed depreciation to the extent of ₹ 1,68,28,559/- as against the actually allowable of ₹ 2,55,44,498/-. The assessee vide letter dated 25.11.11 requested the AO to treat the revised return filed by in response to notice u/s 148 and al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chose the course of reopening of assessment in order to rectify the simple computational error was a matter of serious prejudice to the assessee as the entire assessment was reopened u/s 147 of the Act. The ld. Counsel submitted before us the ld. AO thus caused grave injustice and prejudice by re-opening the assessment which could have done by having recourse to alternative efficacious remedy of rectification u/s 154 of the Act and thus AO jurisdiction u/s 147 of the Act was wrong , illegal and the against the spirit of the law. They could not be permitted to disturb the entire assessment in order to rectify a apparent mistake for which the law had provided build in remedy under the provisions of section 154 of the Act which empowered the AO the rectify the mistake which are apparent from records without disturbing the entire concluded assessment. The ld. AO also made various other additions which could not have otherwise made at the AO not reopening the case u/s 147. Ultimately the counsel for the assessee finally prayed that the entire addition of reassessment proceeding be declared as null and void ab initio and the consequent assessment order passed by the lower authorities be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duced hereunder: Explanation 2.-For the purposes of this section, the following shall also be deemed to be cases where income chargeable to tax has escaped assessment, namely:- (a) where no return of income has been furnished by the assessee although his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax; (b) where a return of income has been furnished by the assessee but no assessment has been made and it is noticed by the Assessing Officer that the assessee has understated the income or has claimed excessive loss, deduction, allowance or relief in the return; (c) where an assessment has been made but- (i) income chargeable to tax has been under assessed; or (ii) such income has been assessed at too low a rate; or (iii) such income has been made the subject of excessive relief under this Act; or (iv) excessive loss or depreciation allowance or any other allowance under this Act has been computed. Thus, the assessee company has not made correct claim regarding its unabsorbed depreciati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess unabsorbed depreciation claim which empowers the tax authorities including the AO to amend any order passed by them with a view to rectify any mistake apparent from the record. In the case of Hindustan Unilever Ltd. vs. Deputy Commissioner of Income-Tax (supra) the Hon ble Bombay High court has clearly held that the revenue had an efficacious remedy open to it in the form of a rectification under section 154 for correcting a computational error and consequently recourse to the provisions of section 147 was not warranted. In case of the assessee, excessive claim on account of brought forward depreciation was sought to be rectified by the re-opening of the entire assessment is also against the ratio laid down by the Hon ble Jurisdictional High Court in the above decision. In the case of J.C. Thakkar vs. CIT [1955] 27 ITR 658 (Bom) the Division Bench of the Bombay High Court laid down the similar principle that when one or more modes of assessment or remedies are available to the taxing authority, the authority must adopt that remedy which is a matter of the least prejudice to the assessee. We, therefore, by respectfully following the ratio laid down in the above said decisions an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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