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2016 (10) TMI 362 - GUJARAT HIGH COURT

2016 (10) TMI 362 - GUJARAT HIGH COURT - TM - Reopening of assessment - MAT applicability - Held that:- As decided in PKM Advisory Services P. Ltd. V/s. Income-Tax Officer, [2011 (1) TMI 1105 - Gujarat High Court ] when the tax payable as per the reasons recorded is less than the tax paid by the petitioner under the assessment framed under section 143(3) of the Act, the question of any income having escaped assessment does not arise. The order recording reasons, itself indicates that in fact no .....

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h the impugned notice under section 148 of the Act as well as all proceedings pursuant thereto cannot be sustained - In case of India Gelatine And Chemicals Ltd. V/s. Assistant Commissioner of Income-Tax (No.1) [2015 (2) TMI 808 - GUJARAT HIGH COURT ] noted that loss claimed by the assessee even if was disallowed, there would be no difference in the assessee's tax liability under Section 115JA of the Act. It was therefore, observed that there was no escapement of income assessable to tax on .....

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ssment Year 2007-08. 2. Brief facts are as under : 2.1 The petitioner is a company registered under the Companies Act and is engaged in the business of manufacturing Ayurvedic and Herbal drugs. For the Assessment Year 2007-08, the petitioner had filed the return of income on 15.10.2007 declaring total income of ₹ 5.33 lacs (rounded off). Such return was taken in scrutiny by the Assessing Officer. He carried out the assessment by passing an order on 22.5.2009 in which he taxed the assessee .....

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d of 4 years from the end of relevant assessment year. The Assessing Officer had recorded following reasons for issuing the notice : Reasons for reopening of assessment. In this case return of income for the A.Y.2007-08 showing the income of ₹ 533240/- was filed on 15.10.2007 and the assessment was finalized u/s 143(3) vide assessment order dated 22.5.2009. In this regard it is noticed that : (A) The assessee has two units, One in Dehradun which is eligible for deduction u/s 80IC of the Ac .....

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of the Act. (B) Further the assessee has paid rent of ₹ 25,20,000/- to M/s Eldee Harbo Care Ltd and the expenses has been charged in P&L A/c of Rajkot uniot. The clause 28 of the form 10CCB reveals that the said expenditure is incurred by Rajkot unit on behalf of Dehradun Unit which is eligible for deduction u/s 80IC of the Act. As the income of Dehradun unit is totally exempt u/s 80IC of the Act, expenditures relatable to that unit cannot be allowed in the hands of any other taxable .....

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to be disallowed. (D) It is also seen that in the computation of income of the Dehradun unit eligible for deduction u/s 80IC of the Act shows the profit from trading of goods is ₹ 184627/-. The said profit has been added back to the net profit and has been claimed as deduction u/s 80IC of the Act. However the profit from trading of goods is not eligible for deduction u/s 80IC. Therefore the same is required to be treated as taxable income not eligible for deduction u/s 80IC of the Act. In .....

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issues, which according to him, individually accounted for the income chargeable to tax having escaped assessment. However, in the background of one single contention raised by the learned counsel for the petitioner, it is not necessary to analyze these reasons at any length. Suffice it to record, from reasons recorded, the combined effect of the total income, which according to the Assessing Officer, had escaped assessment, would come to ₹ 50 lacs (approximately). 4. On the basis of such .....

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f the assessee - company, for the purpose of Section 115JB of the Act, was computed at ₹ 4.59 crores against the normal working out of the assessee's income at ₹ 8.88 lacs. He would therefore, argue that even if the additions of ₹ 50 lacs are made, the net assessable income of the assessee under normal computation provision would come to ₹ 58.88 lacs. In any case therefore, the assessee - company would still be governed by the MAT provision contained in Section 115JB .....

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ction on these aspects of the matter. Accordingly, the petition was placed for further hearing today. 6. Learned counsel, Shri P.G.Desai for the revenue, under the instructions, stated that insofar as factual assertions of the petitioner in this respect is concerned, the same are correct. In other words, the revenue is unable to dispute the petitioner's contention that even if all additions are allowed to be made as proposed by the Assessing Officer in the reasons recorded, there would be no .....

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nt that the assessee has been assessed under the provisions of section 115JB of the Act and has paid tax of ₹ 4,72,967/- at the rate of 7.5% of ₹ 63,06,232/- as determined under the said section. According to the Assessing Officer, the income chargeable to tax that has escaped assessment by way of excess depreciation is ₹ 8.59.944/-. Adding the said amount to the amount computed under the ordinary provisions of the Income Tax Act, the aggregate amount even as per the Assessing .....

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