TMI Blog2016 (9) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... e same as business income and consequently it was adjusted against brought forward business losses. In view of the above, we are satisfied that the A.O initiated reassessment proceedings beyond four years passed on erroneous facts that the impugned amount had already been offered for tax by the assessee as business income whereas the A.O noted that income to the tune of ₹ 50 lakhs has escaped assessment. We may also point out that the main dispute was regarding charging of the said amount as in the original assessment proceedings the A.O taxed the same as business income whereas in the reassessment proceedings the A.O has shown his intention to tax the same as income from other sources and we may also point out that the rectification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in not considering the waiver of loan written off as business income under 41(1) of incomes tax act 1961 and thus denied the benefits of set off of brought forwarded losses of earlier year against this income by holding Income from Other Sources 3. That on the facts and in the circumstances of the case and in law, the learned CIT (A) is erred in holding that loans written off by creditors company should be assessed as Income from other sources instead of a business income. 4. That the Learned CIT (A) has not properly appreciated the submission made before her in on letter dated 06/09/2013 and 19/09/2013 and unjustifiable confirmed the order u/s 147 / 143(3) of the Income TAX Act, 1961 passed by the Assessing Officer. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n examined at the stage of original assessment framed u/s 143(3) of the Act that would tantamount to mere change of opinion which is not permissible in law. The ld. AR narrating the facts of the case submitted that the assessee filed original return of income dated 13.10.2004 declaring an income of ₹ 1,45,56,809/- which income had been adjusted against brought forward assessed loss and the A.O passed assessment order u/s 143(3) of the Act dated 8.12.2006 after detailed enquiries and investigations on various issues and returned income was accepted at NIL therein. The ld. AR placing reliance on the decision of the Hon'ble Supreme Court in the case of CIT Vs Cray Research India Ltd reported at TS-509- Supreme Court-2015 submitted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .O had reason to believe that income to the tune of ₹ 50 lakhs has escaped assessment within the meaning of section 147 of the Act. Therefore, the A.O was quite correct and justified in initiating reassessment proceedings and issuing notice u/s 147/148 of the Act. 5. On careful consideration of the above rival submissions, first of all, we may point out that the undisputedly and admittedly, original return was filed on 30.10.2004 for A.Y 2004-05 and the impugned reasons and notice for initiation of reassessment proceedings was recorded and issued on 25.3.2011 i.e. beyond four years of the time. Thus, as per mandate of provisions of section 147 of the Act, no action could have been taken under this provision after expiry of four yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of failure on the part of the A.O to disclose truly and fully all material facts in this regard. In the present case, original assessment has been framed u/s 143(3) of the Act after due scrutiny and after all details were filed before the A.O. We also observe that income written back amount has been assessed as business income and claim for brought forward losses of the earlier years has been allowed. We also are in agreement with the contention of the ld. AR that the amount written back as loan has been carefully assed by the A.O as business income. Therefore, it cannot be alleged against the assessee that the assessee had not disclosed fully and truly all material facts regarding this issue during the assessment proceedings. We may also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd consequently it was adjusted against brought forward business losses. In view of the above, we are satisfied that the A.O initiated reassessment proceedings beyond four years passed on erroneous facts that the impugned amount had already been offered for tax by the assessee as business income whereas the A.O noted that income to the tune of ₹ 50 lakhs has escaped assessment. We may also point out that the main dispute was regarding charging of the said amount as in the original assessment proceedings the A.O taxed the same as business income whereas in the reassessment proceedings the A.O has shown his intention to tax the same as income from other sources and we may also point out that the rectification proceedings u/s 154 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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