9911796707
TMI Blog2017 (1) TMI 1106X X X X Extracts X X X X X X X X Extracts X X X X ..... r AY 200910 on 29.05.2010 and revised return of income on 29.05.2010. That the assessee claimed deduction under Section 80IA of the Act in both the returns. It is the case of the petitionerassessee that while claiming deduction under Section 80IA of the Act, during the course of regular assessment under Section 143 of the Act, the Chartered Accountant of the assessee supplied the various details in respect of Windmill Division in response to the inquiry of the Assessing Officer; one being Form No. 10CCB under Rule 18BBB of the Income Tax Rules, 1962, being audit report in respect of Windmill Division, certifying the above figure of profits and gains of windmill division at Rs. 56,22,625/and the last being expenses in respect of windmill division of insurance premium of the windmills as also the repairs and maintenance of the windmills at Bhogat and Satara. That the Assessing Officer thereunder passed the assessment order accepting the revised return of income of Rs. 50,58,06,780/. 2.2. That thereafter, Assessing Officer has issued impugned notice under Section 148 of the Act dated 20.04.2015 alleging that income chargeable to tax has escaped assessment for the AY 200910 and asking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpany seems to have debited only some direct expenses to the wind mill divisions, where all the indirect expenses have been debited to the Electronic Appliances Division, thereby artificially pumping its income eligible for deduction u/s 80IA, leading to lower returned income and consequently lower taxes. The assessee ought to have enhanced the total income of his "Electronic Appliances Division to the extent of unapportioned administrative expenses and financial charges which of Rs. 10,83,692/which is not done. This has resulted into under assessment of income of Rs. 10,83,692/within the meaning of Section 147 of the Act. In view of the above I have reason to believe that the income chargeable to tax to the extent above has escaped the assessment within the meaning of Section 147 of the Act. The notice is issued after obtaining prior approval of the CIT3 Rajkot granted vide letter No.CIT.R.3/Tech/148/01/201516 dated 10.04.2015." 2.3. That the assessee filed its objection vide letter dated 04.07.2016 to the reasons submitting that there was no omission or failure on the part of the assessee in not disclosing the true and correct facts, as required under the proviso to Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ves to be quashed and set aside. 3.2. It is vehemently submitted by Shri Shah, learned counsel for the petitionerassessee that as such the issue with respect deduction under Section 80IA of the Act was considered in detail and / or gone into in detail by the Assessing Officer while framing scrutiny assessment under Section 143 (3) of the Act. It is submitted that at the time of scrutiny assessment figure of administrative expenses and financial charges of the entire business and for the non debiting of administrative and financial charges to windmill division were very much there. It is submitted that assessment is sought to be reopened on the ground that assesseee ought to have apportioned the administrative expenses to the windmill division and assessee ought to have debited the administrative expenses and financial charges while computing the profit of windmill division. It is submitted that therefore, when all the material facts were available before the Assessing Officer and thereafter Assessing Officer allowed the deduction under Section 80IA of the Act, as claimed by the assessee, it cannot be said that there was any failure on the part of the assessee in not disclosing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is justified in reopening the assessment. 4.3. It is submitted by Shri Pranav Desai,learned counsel for the revenue that whatever was produced by the assessee during the assessment proceedings by that it cannot be said that all the relevant and necessary details were submitted by the petitionerassessee in respect of Windmill Division. It is submitted that there does not appear to be any specific inquiry made during the original assessment proceedings concerning Windmill Division. It is submitted that no information with respect to debiting any financial charges and administrative expenses to the Windmill Division separately were supplied at the time of original assessment. It is submitted that therefore, there was failure on the part of the assessee in not disclosing true and correct facts and therefore, Assessing Officer is justified in reopening the assessment. 4.4. Shri Pranav Desai, learned advocate appearing on behalf of the Revenue has relied upon the recent decision of the Hon'ble Supreme Court in the case of Girilal & Co. vs. Incometax Officer, Mumbai reported in (2006)387 ITR 122 (SC). He submitted that in the aforesaid decision the Hon'ble Supreme court has observed an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cle 226 of the Constitution of India, the petitioner has challenged the impugned notice under Section 148 of the Act, by which, the Assessing Officer has sought to reopen the assessment for AY 200910. The reasons recorded to reopen the assessment are as under: "In this case, the Return of Income showing the total income of Rs. 50,37,77,570/was filed on 29.09.2009. Subsequently, a revised return of income was also filed showing the total income of Rs. 50,58,06,780/on 29.05.2010. The assessment was finalized u/s 143(3) of the Act vide order dated 28.12.2011 determining the Income at Rs. 50,58,06,780/. It is seen that the assessee company is running two business (1) Electronic Appliances Division and (2) Power Generation Division. During the year under consideration, the assessee has claimed benefit u/s 80IA of Rs. 56,22,625/in respect of power generation income from windmill at "Bhogat 1.75 M.W. Geda, Wind Power Generation, Tal: Kalyanpur, Dist. Jamnagar". The assessee has not debited any financial charges and administrative expenses to the windmills division. However, on perusal of the P & L A/c of the assessee, it has been noticed that assessee has not debited any administrative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e true and correct facts. It is the case on behalf of the petitioner that what is sought in the reassessment is recomputation of the deduction under Section 80IA of the Act, the details and particulars already lying in the assessment record and therefore, reopening is not permissible. It is also the case on behalf of the petitioner that while framing the original assessment under Section 143(3) of the Act as the Assessing Officer considering the entire claimed under Section 80IA of the Act and thereafter granted the benefit / deduction under Section 80IA of the Act, subsequent reopening did not permissible on the ground of change of opinion of the subsequent Assessing Officer. 5.2. However, it is required to be noted that the assessee companies running two business (1) Electronic Appliances Division and (2) Power Generation Division. It appears that during year under consideration, the assessee claimed benefit under Section 80IA of the Act of Rs. 56,22,625/in respect of power generation income from Windmill Division at Bhogat. However, submitting return and claiming deduction under Section 80IA of the Act, the assessee did not debit any financial charges and administrative expense ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it at Bhogat, the assessee had not debited any financial charges and administrative expenses to the Windmill Division and P & L account, the assessee had not debited any administrative expenses and financial charges while computing profits from the windmill division. The assessee was required to apportion administrative expenses and financial charges on its windmill unit at Bhogat, in which, it had claimed deduction under Section 80IA of the Act. Even otherwise, it is required to be noted that order dropping proceedings under Section 263 of the Income Tax Act is a non speaking order. Shri Desai, learned counsel for the revenue has produced on record the relevant file for dropping the revenue proceedings under Section 263 of the Act for AY 201213 and the reasons recorded to drop the proceedings under Section 263 of the Act for AY 201213 and considering the same, it appears that for AY 201213 the assessee produced the relevant and required details (including audit report in Form No. 10 CCB, working of profit eligible for deduction under Section 80IA in respect of 3 windmills and ledger accounts of income and expenses relating to 3 windmills) to the Assessing Officer during the course ..... X X X X Extracts X X X X X X X X Extracts X X X X
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