TMI Blog2019 (7) TMI 1735X X X X Extracts X X X X X X X X Extracts X X X X ..... ngible material before the AO to come to the conclusion that there is an escapement of income. This issue has been dealt in by Hon ble Bombay High Court in the case of Godrej Agrovet Ltd [ 2010 (2) TMI 27 - BOMBAY HIGH COURT] wherein it is held that the Assessing Officer cannot act in excess of the restrains on his jurisdiction to reopen an assessment in exercise of the powers under section 147 read with section 148 - Decided in favour of assessee. - ITA No. 2255/Mum/2017, CO No. 266/Mum/2018 (Arising in ITA No. 2255/Mum/2017 for AY 2009-10) - - - Dated:- 19-7-2019 - SRI MAHAVIR SINGH, JM AND SRI RAJESH KUMAR, AM For the Appellant : Sh. Vachashpati Tripathi, DR For the Respondent : Sh. Dr. K. Shivram, Sr. Adv., Sh. Rahul K. Hakani, ORDER PER MAHAVIR SINGH, JM: This appeal of Revenue is arising out of the order of CIT(A)-13 Mumbai in Appeal No. CIT(A)-13/DCIT-7(2)(2)/825/2015-16 vide order dated 2.1.2017 for the A.Y. 2009-10. Original assessment was confirmed by the Additional CIT-Range 7(1), Mumbai under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) vide his order dated 19.12.2011. The reassessment was framed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new grounds under Rule 27 of the ITAT Rules but he could not controvert that this issue has been adjudicated against the assessee by the CIT(A). 5. In view of the factual position that the issue of reopening has been raised before the CIT(A) and he has adjudicated the issue against assessee on jurisdiction but the appeal was allowed in favour of assessee on merits. In terms of the above, we admit this issue and adjudicate now. 6. Brief facts are that the assessee filed its return of income on 30.9.2009 for the relevant A.Y. 2009-10. The assessee s case was taken up for scrutiny assessment and notice under section 143(2) of the Act was issued and served upon the assessee. Consequently, the assessment was framed under section 143(3) of the Act by the AO vide order dated 19.12.2011. Subsequently the AO issued notice under section 148 of the Act dated 28.3.2014 and for this he recorded the reasons and supplied to the assessee vide letter dated 15.12.2014. In the reasons recorded, the AO pointed out that the assessee has shown the receipt of share premium amounting to ₹1.92 crores and the issue of share premium was not the subject matter of verification by the AO during the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der section 143(3). No details with regard to justification for share premium over and above the intrinsic value of the share have also been called for in the course of original scrutiny assessment. To ascertain the nature and the justification for charging share premium over and above the intrinsic value of the shares, a notice under section 133(6) of the I.T. Act was issued to the assessee on 19.03.2014. However, no compliance to this notice was made by the assessee on the specified date. I have reason to believe that income to the extent of amount of share premium received over and above the intrinsic value of the share has escaped assessment. Since in the original assessment this issue of share premium being charged over and above the intrinsic value of the share was not examined and there was no application of mind on this issue this reopening of the assessment is being done in light of ration of decision of CIT vs. Usha International [348 ITR 485 (Del.)] Export Credit guarantee Corporation of India Ltd. Vs. Addl. CIT [350 ITR 651 (Bom.)]. In view of the above facts discussed above and in the light of the ration of decision cited above, I have reason to believe tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment record originally. Learned Counsel for the assessee stated that the reopening is merely on change of opinion as the same set of facts were available before the AO during the course of original proceedings and revisiting to the same set of fact in the reassessment is merely a change of opinion. Even otherwise learned Counsel for the assessee stated that while reopening the assessment the AO has gone through the case records i.e. information submitted by the assessee on the issue of reopening of assessment and there was no tangible material came to his notice after original assessment. 11. On the other hand, learned Senior Departmental Representative heavily relied on the assessment order, the reasons recorded by the Assessing Officer. Learned Sr. Departmental Representative argued that reopening has rightly been affirmed by the learned CIT(A) for the reason that the AO not gone into details filed by the assessee during the course of original assessment proceedings in regard to the share premium money received by the assessee company. In the absence of any opinion formed on the details filed by the assessee before the AO during the original proceedings, which cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India Ltd. (2010) 320 ITR 561. Hon ble Bombay High Court held as under: - 11. The provisions of section 147 of the Act empower the Assessing Officer to reopen an assessment or issue a notice for reassessment provided that he has reason to believe that income has escaped assessment. In a judgment of a Division Bench of this Court in German Remedies Ltd. vs. Dy. CIT [2006] 285 ITR 26 delivered by one us, Shri. J.P. Devadhar, this Court held that though the power to reopen a concluded assessment under section 147 is wide, the power cannot be exercised mechanically or arbitrarily. This Court held that even after the introduction of the concept of deemed escapement of income by Explanation 2 to section 147 with effect from 1.4.1989 the belief that income had escaped assessment must be a prudent decision and not a mere change of opinion. This Court held that an assessment order passed after detailed discussion cannot be reopened within a period of four years from the end of the relevant assessment year unless the Assessing Officer has reason to believe that due to some inherent defect in the assessment the income chargeable to tax has been under assessed or assessed to a lower rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being that the deduction should not be exceed the amount distributed by way of dividend on or before the due date for the filing of a return. The Assessing Officer by adverting to the provisions of section 115-O has proceeded to reopen the assessment on a plainly extraneous ground. 13. For the aforesaid reasons, the Assessing Officer has clearly acted in excess of the restraints on his jurisdiction to reopen an assessment in exercise of the power under section 147 read with section 148. The assessee would be entitled to succeed in these proceedings. Rule is accordingly made absolute by setting aside the notice dated 28.3.2008. In the circumstances of the case, there shall be no order as to costs. 14. In another judgment Hon ble Bombay High Court in the case of Siemens Information System Ltd., vs. Assistant Commissioner of Income tax [2007] 295 ITR 333 (Bombay) held as under: - 24. In the instant case, the second Assessing Officer for the assessment year 2003-04 on the same set of facts has taken a view which is different from the view taken by the previous Assessing Officer for the assessment year 2001-02, on the interpretation of the same provisions of law. It is possi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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