TMI Blog2019 (12) TMI 698X X X X Extracts X X X X X X X X Extracts X X X X ..... , are factually incorrect, so as to derive a conclusion that the petitioner has not truly and fully disclosed the material facts. As this Court finds that there is no dispute with regard to the date of commencement of manufacture of the product namely 01.04.1996, when the petitioner has chosen to claim direction from the second year onwards, the number of consecutive years for which deduction is claimed referred to at Serial No.8 is certainly the 10th year and therefore, such statement by the petitioner at Serial No.8, cannot be termed as false statement or claim. When such being the position, find that the Assessing Officer is not justified in reopening the assessment in the absence of failure on the part of the assessee to truly and fully disclose the material fact. Reopening is barred by limitation, as the AO has not satisfied that the assessee has failed to disclose the material facts truly and fully. Accordingly, this writ petition is allowed and the impugned order is set aside. - W.P.No.4808 of 2014 And M.P.No.1 of 2014 - - - Dated:- 18-11-2019 - Mr. Justice K. Ravichandrabaabu For the Petitioner : Mr.N.V.Balaji For the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar of claim. The petitioner opted to claim of deduction commencing from the Assessment Year 1998-99. Such option is available to the assessee insofar as the provisions of Section 10B granted a relief in respect of any five Assessment Years falling within a period of eight years. The consistent legal position adopted by the petitioner is thus, that it is entitled to claim deduction under Section 10B of the Act for a period of ten years commencing from the Assessment Year 1998-99 in terms of the law prevailing at the relevant point of time. (d) Returns of income were filed by the petitioner from the Assessment Year 1998-99 onwards claiming deduction under Section 10B of the Act. The Income Tax Department, after a thorough scrutiny of the returns filed by the petitioner, accepted the entitlement of the petitioner to claim deduction under Section 10B in respect of the Assessment Years commencing from 1998-99 for the period of 1998-99 to 2007-08. While this is so, the petitioner states and submits that with respect to Assessment Year 2007-08, a return of income was filed on 17.10.2007 returning total income of an amount of ₹ 1,57,325/- and claiming deduction of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ieve that income charged under the tax relevant to the said Assessment Year had escaped assessment. In response to the said notice, the petitioner filed a return of income and sought the reasons for reopening the assessment. The respondent through communication dated 29.10.2013, furnished the reasons. The petitioner filed their objections against the reopening through communication dated 18.11.2013. However, the Assessing Officer rejected the objections and passed the impugned order on 20.01.2014. Hence, the present writ petition is filed before this Court. 3. The respondent filed a counter wherein, it is stated as follows :- (a) As per provisions of Section 10B prior to 01.04.1999, the relief is granted in respect of any five assessment years falling within a period of eight years. But the provisions of Section 10B with effect from 01.04.1999, granted a relief for a period of ten consecutive Assessment Years beginning with the Assessment Year relevant to the previous year in which the undertaking begins to manufacture or produce articles or things or computer software. The petitioner wrongly interpreted the provisions of Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Mr.N.V.Balaji, learned counsel appearing for the petitioner submitted as follows :- The respondent having examined the issue of eligibility under Section 10B in detail at the time of original assessment and accepted the same, more particularly, when all particulars and details required have been duly furnished by the Assessee, is not justified in reopening the assessment by taking a different view with regard to the claim of deduction under Section 10B. There is no failure on the part of the petitioner to disclose any details in respect of the claim made. The impugned reopening proceedings have been initiated beyond a period of four years from the end of the relevant Assessment Year and since there has been no failure to make a full and complete disclosure of all material particulars, the bar of limitation set out in the proviso to Section 147 is attracted. The petitioner claimed the benefit of deduction under Section 10B by relying upon Section 10B (3) of the Income Tax Act, as existed prior to 01.04.1999. The benefit of deduction was claimed by the petitioner not from the first year from the date of manufacture but on the other hand from the seco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent facts and circumstances. 6. Heard both sides and perused the materials placed before this Court. 7. The point for consideration in this writ petition is as to whether the reopening of the assessment relevant to Assessment Year 2007-08 beyond the period of four years, can be sustained on the reasons stated by the Assessing Officer which was confirmed in the impugned order. 8. In respect of the relevant Assessment Year 2007-08, admittedly, the notice under Section 148 was issued on 26.03.2013 after a period of four years. Therefore, it is to be seen as to whether the petitioner has failed to disclose true and full material particulars before the Assessing Officer at the time of filing the original return. In this case, the issue involved for reopening is based on the claim made under Section 10B of the Income Tax Act. According to the petitioner, date of commencement of manufacture of the product was 01.04.1996. 9. The respondent is not disputing the above said date of commencement of manufacture. The dispute is in respect of the claim of the petitioner regarding the number of consecutive year for which the ded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... According to the Revenue, if the date of commencement of manufacture or production referred to in the Column No.7 in Form No.56G as 28.03.2000 is taken as true, the deduction claimed was at the eleventh year and not at the tenth year. The petitioner seeks to explain that the entry made in Column No.7 of Form 56G was by mistake and on the other hand, the actual date of commencement of manufacture was only on 25.05.2000. At the same time, Column No.8, which deals with number of consecutive year for which the deduction claimed, was rightly stated as tenth year. Therefore, the question that arises for consideration, under the above stated circumstances, is as to whether these contradictory statement made by the petitioner can be brought under the purview of non disclosure of fully and truly all material facts necessary for his assessment, to attract the extended period of limitation. 16. No doubt, Column No.7 and 8 contradicts each other with regard to the commencement of manufacture. However, when one of such column has specifically referred the number of consecutive year as the tenth year to claim 10B deduction and when the Assessing Officer h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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