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2018 (3) TMI 956

s which were available before him at the time of making assessment u/s.143(3) of the Act and no new tangible material has come on the basis of which it could be said that the Assessing Officer has reason to believe that income chargeable to tax has escaped assessment on account of failure on the part of the assessee to disclose truly and fully material of facts in the assessment. - Assessing Officer has not brought on record any new tangible material to initiate reassessment proceedings but relied only on tax audit report and financial statements, which were already filed before the Assessing Officer in the scrutiny proceedings. Thus we are inclined to set aside the order of the CIT(A) on this ground and quash the reassessment order. - Decided in favour of assessee - ITA No.300/CTK/2014 And ITA No.329/CTK/2014 - Dated:- 19-3-2018 - SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER For The Assessee : Shri S.S.Podar/ N.Kedia, ARs For The Revenue : Shri Saad Kidwai, CIT DR ORDER Per Pavan Kumar Gadale, JM The cross appeals filed by the assessee are directed against the order of the CIT(A), Cuttack dated 9.5.2014 for the assessment year 2009-2010. 2. Ground .....

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Ld A.R. submitted that the Assessing Officer has not disposed the objection filed by the assessee with regards to reasons recorded by the Assessing officer for reopening the assessment. It was also submitted that the issues on which the reassessment u/s.147 was proposed, were very much available at the time of completion of Regular assessment u/s.143(3) of the Act. Hence, ld A.R. of the assessee prayed for quashing of the reassessment order passed by the Assessing Officer. 8. Contra, ld D.R. supported the orders of lower authorities. 9. We have heard the rival submissions, perused the orders of lower authorities and materials available on record. Before going to the merits of the case, we consider it necessary to deal with the legal ground challenged by the assessee in reassessment proceedings. Ld A.R. submitted that the CIT(A) has not considered the submissions of the assessee and also the assessment was based on the same set of facts and change of opinion and the CIT(A) has erred in confirming the reassessment order and consequently the additions. Ld A.R. emphasised that in earlier assessment year i.e. 2008-09, the revenue has taken the stand that the reopening of assessment u/s. .....

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years. On perusal of record, it is seen that while rectifying u/s.154 of the I.T. Act,1961, the Assessing • Officer had allowed depreciation on brought forward WDV of capital expenditure of earlier years of ₹ 434.45 lakhs and deduction u/s.35E in respect of 'Prospecting & Boring Expense' of earlier years of ₹ 718.71 lakhs, totaling of ₹ 1153.16 lakhs. The above expenses were not disallowed by the Assessing. Officer at the time of framing assessment u/s.143(3) of the I.T. Act,1961, dt.30.12.2011. Thus, the above referred expenses has escaped assessment. 4. TDS u/s.195(1) on foreign currency remittance. Schedule-? to the 'Notes on Account' at para No.20(D)(others), the Auditor had certified that the assessee incurred expense in foreign currency to the tune of ₹ 459.67 lakhs against which no tax was deducted u/s.195(1) of the I.T. Act,1961. Therefore, the same attracted the provision of section 40(a)(ia) of the I.T.Act,1961 and escaped assessment. 5. Disallowance u/s. section-43B . As per coiumn-21(B) and annexure-7A to form No.3CD , the tax auditor had certified that an amount of ₹ 3845.34 lakhs Of the statutory dues was remained .....

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y be too apparent and obvious. To hold that the assessing officer in the first round did not examine the question or subject matter and form an opinion, would be contrary and opposed to normal human conduct. Such cases have to be examined individually. Some matters may require examination of the assessment order or queries raised by the Assessing Officer and answers given by the assessee but in others cases, a deeper scrutiny or examination may be necessary. The stand of the Revenue and the assessee would be relevant. Several aspects including papers filed and submitted with the return and during the original proceedings are relevant and material. Sometimes application of mind and formation of opinion can be ascertained and gathered even when no specific question or query in writing had been raised by the Assessing Officer. The aspects and questions examined during the course of assessment proceedings itself may indicate that the Assessing Officer must have applied his mind on the entry, claim or deduction etc. It may be apparent and obvious to hold that the Assessing Officer would not have gone into the said question or applied his mind. However, this would depend upon the facts a .....

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use of power by the Assessing Officer. Hence, after 1April, 1989, Assessing Officer has power to re-open, provided there is tangible material to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief. 14. We applying the ratio of decisions in the present case found that thee Assessing Officer has initiated reassessment proceedings on the same facts which were available before him at the time of making assessment u/s.143(3) of the Act and no new tangible material has come on the basis of which it could be said that the Assessing Officer has reason to believe that income chargeable to tax has escaped assessment on account of failure on the part of the assessee to disclose truly and fully material of facts in the assessment. 15. We considering the overall aspects and the reasons recorded for reopening the assessment are of the substantive view that the Assessing Officer has not brought on record any new tangible material to initiate reassessment proceedings but relied only on tax audit report and financial statements, which were already filed before the Assessing Officer in the scrutiny proceedings. Acc .....

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