TMI Blog2011 (10) TMI 677X X X X Extracts X X X X X X X X Extracts X X X X ..... as under:- On the facts and in the circumstances in the case and in law, the Ld. CIT(A) erred in holding that the assessment completed u/s.143(3) and with Sec. opinion was formed by the AO with regard to advertisement and publicity expenses in the order dated 27.12.2006. The appellant prays that the order of CIT(Appeals) on the above grounds be set aside and that of the Assessing Officer restored. 2.1 Facts of the case in brief are that the return of income for A.Y. 04-05 was filed by the assessee on 1-11-04, declaring total income at ₹ 8,96,50,630/- which was processed u/s 143(1). Subsequently, in the scrutiny u/s.143(3) the returned income was accepted by the A.O. vide order dated 27.12.06. Thereafter, on the basis o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under:- The assessment record of AO has been seen. The appellant s contention of letters giving details to AO during assessment proceedings is found to be part of the assessment record of A.O. The finding of AO while recording reasons for reopening that such details were not called for nor verified during scrutiny proceedings and appellant not having disclosed these details is incorrect and not supported by the facts of the case and material available on record. 3.1.2 The reopening is for disallowance of advertisement and publicity expenses considered excessive and unreasonable and as having benefited the NGC Network Asia from whom Appellant has a distribution agreement. Details available on record indicate that the said expen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the scrutiny proceedings. The assessee had also neither made any declaration nor disclosed to the A.O. Therefore, in view of the finding for A.Y. 2005-06, the A.O. had reason to believe that similar disallowances were called for in A.Y. 2004-05. Since the A.O. had reason to believe that taxable income has escaped assessment, therefore, the initiation for re-assessment proceedings by the A.O. is valid in law. 4. The ld. counsel for the assessee, on the other hand, submitted that the ld. CIT(A) was fully justified in holding the reassessment proceedings as invalid. He submitted that there is a fundamental difference between the decisions relied on by the ld. D.R. and the facts of the present case. Referring to the copy of the Third Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. counsel for the assessee drew the attention of the Bench to the nature of business as mentioned by the A.O. at page 2 3 of the assessment order. He submitted that the A.O. in the scrutiny assessment had accepted the income ₹ 89650630/- after considering the T.P. report. No new material has come to the notice of the A.O. Terefore, the re-opening of the assessment made by the A.O. is due to mere change of opinion which is not sustainable in law. He accordingly submitted that the ld. CIT(A) was fully justified in holding that the reassessment proceedings are invalid. 5. We have considered the rival arguments made by both the sides, pursued the orders of the Assessing Officer and the CIT(A) and the paper book filed on behalf of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is squarely applicable to the facts of the present case. In the case of Kelvinator of India Ltd. (supra), it has been held that the A.O. has power to re-open the assessment provided there is tangible material to come to the conclusion that there was escapement of income from assessment. The reason must have a live link with the formation of the belief. In the instant case we do not find the reasons having any link with the formation of the belief since the A.O. while reopening the assessment for A.Y. 2004-05 has relied on the assessment order for 2005-06 on the issue of disallowance of advertisement expenses and the facts of A.Y. 2005-06 are completely different from the A.Y. 2004-05 in view of the findings of the Third Member in assessee s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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