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2016 (6) TMI 374 - ITAT DELHI

2016 (6) TMI 374 - ITAT DELHI - TMI - Reopening of assessment - Held that:- It is found that the Ld. AR was right in its contention that there was a change of opinion which was clearly seen in the letter produced before us dated 24/9/2003 sent to Senior Receipt Audit Officer. In the said letter, the stand of the A.O was that objection raised by the department may be treated as settled as the adjustment mentioned therein was not permissible under the Act. This letter was produced by the Ld. DR du .....

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account of change of opinion. Therefore, CIT(A) was incorrect while dismissing the appeal of the assessee. - Decided in favour of assessee - I.T.A. No. 1870/DEL/2010, I.T.A .No. 2147/DEL/2010 - Dated:- 3-6-2016 - Shri G. D. Agrawal, Vice President And Smt Suchitra Kamble, Judicial Member For the Appellant : Sh. Vikas Srivastava, Adv For the Respondent : Sh. P. Dam Kanunjna, Sr. DR ORDER Per Suchitra Kamble JM The appeal and cross appeal are filed against the order dated 22/02/2010 passed by CIT .....

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aw, the CIT(A) has erred in holding that the learned Assessing Officer was correct in extending the scope of reassessment proceedings to the issues which were not recorded in the reasons for reopening the assessment and carrying out the detailed scrutiny assessment u/s 148 of the Act. 3. Without prejudice, based on the facts and circumstances of the case and in law, the CIT(A) has erred in holding that the Learned Assessing Officer was correct in disallowing the provision for doubtful debts amou .....

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pholding the disallowance of 25 percent of the provision for obsolescence amounting to ₹ 1,213,037/- created by the appellant during the previous year relevant to the subject assessment year, under the normal provisions of the Act. 6. Without prejudice, based on the facts and circumstances of the case and in law, the CIT(A) has erred in upholding the disallowance of marketing expenditure of ₹ 2,454,798/- incurred on account of mobile phones handset issued to AMCs, dealers and employe .....

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TA No. 2147/Del/2010) 1. That on the facts and circumstances of the case and in law the CIT(A) erred in deleting the addition made by the Assessing Officer on account of provision of gratuity. 2. That of the facts and circumstances of the case and in law the CIT(A) erred in deleting the disallowance of provision for warranty of ₹ 1,77,45,202/-. 3. That on the facts and circumstances of the case and in law the CIT(A) erred in deleting the disallowance of ₹ 1,71,95,149/- out of foreign .....

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notice u/s 148 of the Income Tax Act, 1961 was issued, without requisite approval of JCIT. The Assessee filed reply dated 25/10/2004 asking Assessing Officer to consider revised income dated 30/11/2000. Notice u/s 143(2) of the Act dated 10/10/2005 was issued by A.O initiating assessment. The Assessee filed reply dated 20/10/2005 to Section 143(2) notice, requesting reasons for re-opening before proceeding further with the assessment. 6. On 17/11/2005 reasons for re-opening, in respect of first .....

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k profit which has resulted in under assessment of income to the tune of ₹ 225.97 lacs…… 7. The Assessee inspected A.O s records on 21/11/2005 and found that proceedings u/s 148 of the Act were initiated solely on the basis of audit objection suggesting that provisions, being unascertained liabilities, which should be added to book profit for 115JA. 8. The Assessee filed letter dated 28/11/2005 and objected the legality of first 148 notice (dated 29/9/2004) stating that as 4 .....

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ce u/s 148 was issued, with JCIT approval. On 24/2/2006 NIPL filed a reply asking A.O to consider revised income dated 30/11/2000 and asked for reasons for re-opening. On 8/8/2006 A.O issued notices under Section 143(2), 142(1) of the Act. On 30/8/2006 NIPL filed response to 143(2) notice, reiterating request for reasons recorded before proceeding with assessment. 10. On 30/8/2006 copy of reasons (dated 2/2/2006) in respect of second 148 notice provided by A.O. to the assessee. The same are repr .....

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scertained liabilities have not been added to the book profit which has resulted in under assessment of income………… 11. On 20/09/2006 NIPL filed its objections to reasons for reopening. On 8/11/2006 Order passed by A.O rejecting NIPL s objections. On 24/11/2006 NIPL filed its submission before the A.O. The Assessing Officer disallowed 20% of foreign travelling expenses to the extent of ₹ 1,71,95,149/-, provision for warranty to the extent of ₹ 1,77,45,202/- .....

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see respectively. 14. The Ld. AR submitted that the first notice was withdrawn after the second notice was issued or was in the process of delivery to the assessee. Therefore, as regards the procedural aspect there is lapse on the part of the Assessing Officer. There was a clear opinion given by the Assessing Officer before the auditor vide letter dated 24.09.2003 that there was no evidence as the said provision was an unascertained liability. Hence, A.O submitted a report that the department sh .....

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lding, NEW DELHI Sir, Sub: Audit Objection regarding short recovery of tax in the case of M/s. Nokia India Ltd. Asstt. Year 1999-2000 Please refer to Audit Memo No. 268 dated 3.7.2003 in the above case. The audit scrutiny raised that for the purpose of Section U/s 115JA, the assessee company has not increased the amount or amounts set aside to provision made for meeting liabilities, other than ascertained liabilities, and omission to do so resulted in under assessment of income of ₹ 1,69,6 .....

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above mentioned assessee s self declaration, these liabilities were not be added to the net profit while computing the Book Profit and therefore, the issue raised by the audit is not accepted. In view of the above, objection raised by the Audit may please be treated as settled as the above adjustment were not permissible U/s 143(1) of the I. T. Act. Yours faithfully, Sd/- (SANJOG KAPOOR) Asstt. Commissioner of I. Tax, Circle- 13(1), New Delhi Copy to: The CIT, Delhi - V, New Delhi for informati .....

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