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2016 (11) TMI 542 - MADRAS HIGH COURT

2016 (11) TMI 542 - MADRAS HIGH COURT - TMI - Reopening of assessment - period of limitation - change of opinion - Held that:- In the light of the arrangement between the respondent Department and Department of Posts, it is held that the despatch having been done in terms of business post arrangement is sufficient to hold that the notice was despatched well within the period of limitation. Accordingly the first contention raised by the petitioner is rejected. - Nevertheless to examine as to .....

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quiry under Section 131 of the Act, and the assessee's contention is that the enquiry was completed in 2011, the statements very much available on the date of assessment was finalised by the Assessing Officer and therefore, there is no cause for reopening and the respondent has taken a stand that the enquiry report was received only during 2013. There would be no necessity to go into these aspects of the matter, and if done, it would amount to prejudging the issue and giving a go-by to the direc .....

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8-11-2016 - T. S. Sivagnanam, J. For the Petitioner : Mr. G. Baskar for Ms.S.Sriniranjani For the Respondents : Mrs.Hema Muralikrishnan ORDER The petitioner is a company incorporated under the Indian Companies Act, engaged in the business of providing oil field services to various offshore exploration and production companies in India and abroad. 2. In this Writ Petition, the petitioner seeks for issuance of a Writ of Certiorari, to quash the notice issued by the respondent under Section 148 of .....

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arise, nor the extended period of limitation could be invoked. In this regard, the learned counsel referred to the first proviso under Section 147 of the Act. It was further submitted that the respondent, while communicating the reasons for reopening vide communication dated 09.09.2015, has simultaneously issued notice under Section 143(2) of the Act and the same is illegal. 4. With regard to the plea of limitation, it is submitted that though the impugned notice under Section 148 is dated 31.0 .....

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ening. The learned counsel for the petitioner submitted that in the counter affidavit filed by the respondent in paragraph 6, the respondent refers to a letter from the Department of Posts dated 25.09.2015, which is much after the impugned order and relying on it, the earlier proceedings cannot be validated. With regard to the issue pertaining to limitation, the learned counsel placed reliance on the decision of the High Court of Gujarat in the case of Kanubhai M.Patel (HUF) vs. Hiren Bhatt or H .....

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itted that though the notice is dated 31.03.2015, the postal franking endorsement shows that it was made on 01.04.2015, and the tracking information available in the postal department's website shows that the cover was booked on 02.04.2015 and received by the petitioner on 06.04.2015. Therefore, the entire proceedings are wholly barred by limitation. 5. On the other aspect with regard to reopening of the assessment, reference was made to the order of assessment dated 30.12.2011, (2008-09), a .....

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d for reopening the assessment. Further, it is submitted that Section 90(4) of the Act, was introduced only on 01.04.2013 and in the instant case, the assessment pertains to 2008-09 and the said provision has no application. Further, it is submitted that on a bare reading of the impugned order shows that there is no allegation of suppression and therefore, it is a case of change of opinion without valid material and the proceedings for reopening is not sustainable. The assessment could be reopen .....

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ondent has issued notice under Section 143(2) of the Act, dated 09.09.2015 and the same is illegal. In support of his contentions, learned counsel placed reliance on the decision in the case of Fenner (India) Ltd., vs. DCIT reported in 241 ITR 672; Commissioner of Income Tax vs. Kelvinator of India Ltd reported in [2010] 320 ITR 561 (SC); ACIT vs. ICICI Securities Primary Dealership Ltd., reported in [2012] 348 ITR 299 (SC). 6. Mrs. Hema Muralikrishnan, learned Senior Panel counsel appearing for .....

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eriod. In this regard, photostat copies of pages 165 to 172 of a Register were produced which contain the seal of the Despatcher in the office of the Additional Commissioner of Income-tax Corporate Range-1 as well as a letter received from the Department of Posts, dated 25.09.2015. It is further submitted that as per the business post arrangement , designated personnel of the Department of Posts collects in person, physically, the documents/communications to be mailed from each of the designated .....

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Further, it is submitted that the decision of the Gujarat High Court in the case of Kanubhai M.Patel (HUF) (supra), is not applicable to the facts of the present case and it is clearly distinguishable. Therefore, it is submitted that the plea of limitation is wholly misplaced and not borne out by facts on record. Further, it is submitted that in the light of the decision of the Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd., vs. Income tax Officer & Ors., reported in ( .....

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13 and it is on that basis, the notice for reopening has been issued. In this regard, the learned counsel elaborately referred to the reasons assigned in the impugned order dated 09.09.2015 and also pointed out as to the answers given by the persons, from whom statements have been recorded and submitted that the assessee failed to prove the genuinety of the transaction and therefore, there was full justification for issuance of notice for reopening the assessment. It is submitted that the reason .....

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ome tax Officer & Ors., (supra). 8. Heard Mr.G.Baskar learned counsel for Ms.S.Sriniranjani learned counsel for the petitioner and Mrs.Hema Muralikrishnan, learned Senior Panel counsel for the respondent and perused the materials placed on record. 9. The decision of the Hon'ble Supreme Court in the case of the GKN Driveshafts (India) Ltd., vs. Income tax Officer & Ors., (supra), has spelt out the procedure to be adopted while challenging the jurisdiction for reassessment. The reasons .....

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tax for the assessment year 2008-09 has escaped assessment within the meaning of Section 147 of the Income Tax Act, 1961. Therefore, the respondent proposed to assess/reassess the income for the said assessment year and directed the petitioner to file returns in the prescribed form. 10. The contentions raised by the petitioner in this Writ Petition are broadly two fold, firstly on the ground that the entire proceedings are barred by limitation as the period of six years for reopening the assessm .....

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the petitioner's contention is that though notice was dated 31.03.2015, the same was franked only on 01.04.2015, which is beyond the time limit. Secondly, by downloading the article tracking information from the official website of the Postal Department, it is stated that the letter was booked/despatched only on 02.04.2015, and received by the petitioner on 06.04.2015 and therefore, it is barred by limitation. To buttress the submission, strong reliance has been placed on the decision in the .....

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15 and to further confirm the same, reference is made to a letter given by the Department of Posts dated 25.09.2015. 12. On a careful reading of the decision in the case of Kanubhai M.Patel (HUF) (supra), it is clear that the same would not apply to the facts of the present case. In the said case, the undisputed fact was that the notices in question were sent for booking to the Speed Post centre only on 07.04.2010 and this was confirmed by the Department of Posts by their report, which was taken .....

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produced and there is nothing to discredit this document. Apart from that, the Department of Posts, Business Post Centre, Chennai has given a letter on 25.09.2015, stating that item No.73 addressed to the petitioner was received by their designated personnel from the office of the respondent on 31.03.2015. This communication, which has come from the Department of Posts cannot be discredited nor disbelieved. The communication dated 25.09.2015, is a confirmation to the effect that the postal cove .....

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ings is a clear change of opinion. There may not be a necessity to examine this issue as the same is pre-mature. In terms of the directive issued in GKN Driveshafts (India) Ltd., (supra), as soon as the reasons for reopening are sought for and furnished by the officer, the assessee has to submit his objection. Without doing so, the petitioner has approached this Court. 16. Nevertheless to examine as to whether there is any prima facie case made out by the petitioner on this ground, the Court exa .....

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