TMI Blog2011 (1) TMI 1456X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee filed its return declaring income of ₹ 35,98,981/- under the normal provisions of the Act and ₹ 11,54,083/- under sec. 115JA. The return was processed u/s. 143(1). Notice u/s. 148 dated 21-07-2003 was issued for the following reasons set out in the assessment order : It was observed from the records that the assessee company while computing its book profit U/s 115JA has wrongly calculated deduction U/s 80HHC separately for the purpose of section 115JA. The same is not allowable. The deduction U/s 80HHC to be reduced from the book profit is to be the same as calculated under the normal provisions of income. Also it was seen that the assessee has debited ₹ 97,61,296/- as donations paid in the P L account. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The contention of the assessee is acceptable as far as computation of deduction u/s.80HHC for computing the book profits u/s.115JA is concerned . Thereafter, he proceeded by not allowing the deduction u/s.80HHC for different reasons other than those mentioned in the reasons for the initiation of re-assessment proceedings. It becomes apparent that the AO got satisfied with the assessee and dropped this reason. 7. The second reason taken note by the AO for initiating the re-assessment proceedings is that the assessee did not file any proof of payment of ₹ 25 lakhs towards donation paid and also there was no proof regarding the balance amount of ₹ 72,61,296/-. It was also opined that such amount of ₹ 97.61 lakhs should hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unless the income in respect of which notice was issued u/s.148 swelled the total income as computed by the AO, the AO cannot make addition in respect of other items of income coming to his notice during the course of proceedings under the section. It is apparent from the language of sec. 147 itself which provides that : the AO .may ..assess or re-assess such income AND ALSO any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under the section . It is, therefore, vivid that as long as the reasons recorded by the AO before assuming jurisdiction u/s.147 exist fully or partly , there cannot be any fetter on his powers to assess or reassess a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proceedings. 10. Adverting to the facts of the instant case, it is noticed that as both the issues for which the assessment was re-opened did not find their place in the assessment order as leading to the escapement of income, there was no justification for the AO to continue with the re-assessment proceedings. We, therefore, allow the first ground of appeal. 11. In view of our decision on the first ground, the other grounds have become academic in nature as the jurisdiction of the AO was ousted to assess or re-assess any other income which came to his notice during the course of proceedings under the section. We, therefore, set aside the assessment order on this legal issue. 12. In the result, the appeal is allowed. Pronounc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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