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2019 (3) TMI 427

..... asons in support of the impugned notice, merely mentions about the Assessment for Assessment Year 2015-16. - However, it does not mention of any failure to disclose the correct date of commencement being a fact which came to the knowledge of the Revenue while passing the Assessment Order for Assessment Year 2015-16. - As during regular assessment proceedings, for the subject Assessment Year 2011-12, the Petitioner had at the instance of the Assessing Officer given complete details with regard to the purchase of the flat, the date of agreement of purchase of the flats and also date of possession to the Assessing Officer. The same was examined by the Assessing Officer. At that time, the Assessing Officer was satisfied that the flats were sold prior to the amendment of 2010. It is consequent to the above that the Assessing Officer passed an order dated 26th March, 2014 under Section 143 (3) of the Act and accepted Petitioner's claim for deduction under Section 80IB (10) - As held in HINDUSTAN LEVER LTD. VERSUS RB. WADKAR, ASSISTANT COMMISSIONER OF INCOME-TAX AND OTHERS (NO. 1). [2004 (2) TMI 41 - BOMBAY HIGH COURT] reasons recorded by the Assessing Officer cannot be suppl .....

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..... filed its return of income for A.Y. 201112 on 30.09.2011 declared total income at Rs. Nil after claiming deduction u/s. 80IB at ₹ 29,58,133/. Subsequently, assessment order u/s. 143(3) of the I.T. Act, 1961 was passed on 26.03.2014 accepted return of income declared by the assessee. Further, the case of assessee for A.Y. 2015-16 was selected for scrutiny. During the scrutiny assessment it is observed by the AO that the assessee firm has filed its return of income for the A.Y. 2015-16 on 31.10.2015 declaring total income at Rs. Nil, after claiming deduction u/s. 80IB of the I.T. Act, 1961 at ₹ 103,83,468/. During the course of assessment proceedings, it is evident that the project 'Valencia' is in violation of conditions stipulated in Section 80IB (10) (f) of the I.T. Act, 1961 wherein no individual or his/her spouse may own more than one residential unit in a project claiming deduction under the aforementioned section. Since multiple flats have been registered/ allotted in the name of same individuals, it is amply clear that the assessee has been in violation of express provisions of the act right from the commencement of the project Valencia in year 2010. Atten .....

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..... e accorded as per provisions of section 151 of the Income Tax Act. (d) On 4th September, 2018, the Petitioner filed its objections to the above reasons in support of the impugned notice dated 27th March, 2018. The Assessing Officer by an order dated 24th October, 2018, rejected the Petitioner's objection. 4. This Petition has been filed, challenging the rejection of its objections by order dated 24th October, 2018 that the impugned notice dated 27th March, 2017 is without jurisdiction. 5. Ms. Agarwal, learned Counsel appearing in support of the Petition, submits that the impugned notice is completely without jurisdiction as the same has been issued beyond a period of four years from the end of the relevant Assessment Year without having alleged any failure on the part of the Petitioner to disclose fully and truly all material facts necessary for assessment. It is further submitted that, in any case, the Assessing Officer had completely examined the Petitioner's case before extending the benefit of Section 80IB of the Act. The reasons in support of the impugned notice seek to deny the benefit on the ground that the Petition had not satisfied the conditions in Section 80IB (1 .....

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..... ntitled to the benefit of exemption under Section 80 IB (10) of the Act as from index II of the flats sold registered with the Registrar show that three flats have been sold to the same family. It is on the basis that, this sale was post insertion of section 80IB(10)(f) of the Act w.e.f. 1st April, 2010. However, we find that during regular assessment proceedings, for the subject Assessment Year 2011-12, the Petitioner had at the instance of the Assessing Officer given complete details with regard to the purchase of the flat, the date of agreement of purchase of the flats and also date of possession to the Assessing Officer. The same was examined by the Assessing Officer. At that time, the Assessing Officer was satisfied that the flats were sold prior to the amendment of 2010. It is consequent to the above that the Assessing Officer passed an order dated 26th March, 2014 under Section 143 (3) of the Act and accepted Petitioner's claim for deduction under Section 80 IB (10) of the Act. Thus, in view of the above, the full and true disclosure at the time of regular assessment, the impugned notice is without jurisdiction. 8. It may be pointed out that at the hearing, the Responden .....

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..... nt of challenge to the reasons, must be able to justify the same based on material available on record. He must disclose in the reasons as to which fact or material was not disclosed by the assessee fully and truly necessary for assessment of that assessment year, so as to establish the vital link between the reasons and evidence. That vital link is the safeguard against arbitrary reopening of the concluded assessment. The reasons recorded by the Assessing Officer cannot be supplemented by filing an affidavit or making an oral submission, otherwise, the reasons which were lacking in the material particulars would get supplemented, by the time the matter reaches the court, on the strength of the affidavit or oral submissions advanced. Thus, the submission of Mr. Mohanty not being a part of the reasons recorded, cannot be read into them, in the facts of this case. 9. Therefore, in facts of this case, the reasons in support of the impugned notice not having alleged/ particularized any failure on the part of the Petitioner to disclose fully and truly all material facts necessary for the assessment, the impugned notice is without jurisdiction. 10. Accordingly impugned notice is quashed .....

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