2017 (7) TMI 814

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..... t Petition No.47 of 2008. 2. The petitioner assails the notice issued by the respondent to it under Section 148 of the Income Tax Act, 1961 (the Act) for the Assessment Year 2002-03. The assessment order therein was passed on 31st January, 2005. Thereafter, the impugned notice purportedly under Section 148 of the Act has been issued on 30th March, 2007 seeking to reopen the assessment on the ground that the interest attributable to capital work in progress has been wrongly allowed as revenue expenditure. So also, the royalty paid by the assessee to one Cabot Corporation was in lieu of technical know how from the foreign company, which was in the nature of enduring advantage to the assessee company. The said royalty payment was capital expe .....

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..... missioner of Income Tax and Ors. (2015) 371 ITR 225 and the judgment of the Apex Court in a case of Commissioner of Income Tax Vs. Kelvinator of India Ltd. (2010) 320 ITR 561. 4. Mr. Suresh Kumar, learned Counsel for the respondent supports the order and submits that the Assessing Officer while assessing the return under Section 143 of the Act, had erroneously considered the interest capitalized as revenue expenditure so also royalty as a revenue expenditure. The same was erroneous. The learned Counsel further submits that the claim with regard to interest attributable to capital work in progress was wrongly allowed as revenue expenditure instead of capitalizing the same in capital work in progress as the same is incurred in expansion of c .....

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..... and justify royalty payment debited of Rs. 400 lakhs. Pursuant thereto, the petitioner filed a detailed reply on 15th October, 2004 giving its explanation to the said queries raised by the Assessing Officer. 7. The impugned notice is issued to the petitioner on the ground that these items on account of interest and royalty, which are allowed as revenue expenditure in the assessment order, are on wrong premise. 8. It has been consistently held by the Apex Court and this Court that mere change of opinion cannot be the 'reason to believe' to reopen the assessment. This Court in a case of GKN Sinter Metals Ltd. (supra) has extensively dealt with the law in this regard and after referring to the various judgments of the Apex Court and .....

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