TMI Blog2021 (3) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... er dated 12.8.2015 and 22.7.2015 remanded the matter back to the file of AO for fresh consideration. In the meanwhile, the AO vide notice dated 22.3.2016 initiated reassessment proceedings u/s. 148 of the Act for this AY 2009-10, pursuant to which the assessee filed return of income on 23.4.2016 requesting the AO to provide reasons for initiating reassessment proceedings. AO vide letter dated 27.10.2016 informed the assessee that reassessment proceedings were initiated as per BTA dated 22.7.2008 between the assessee and NF India, goodwill is not treated as part of consideration, hence the assessee made a wrong claim of deducting the goodwill from the sale consideration received. The assessee filed objections against the reassessment proceedings vide letter dated 13.12.2016 questioning the validity of the proceedings. AO overlooking the objection of the assessee, passed combined assessment order giving effect to the ITAT Order dated 22.7.2015 and 12.8.2015 and the reassessment order on 29.12.2016. Against this, the assessee filed appeal before the CIT(Appeals). The CIT(Appeals) also disposed of the appeal by the impugned order dated 22.2.2018. The assessee is in appeal before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ying principles in the case of Kalyanji Mavji Co vs CIT (S) 102 ITR 287 while upholding the action of the AO so far as it relates to initiation of reassessment proceedings under section 147 of the Act. 3.4 The learned CIT(A) has failed to appreciate that the order passed by the learned AO is bad in law in as much as the learned AO has passed the re-assessment order without disposing of the objection of the assessee which goes to the root of the matter and therefore the order passed by the learned AO is ought to be quashed. 3.5 The learned CIT(A) and the learned AO has erred in facts in not considering the return filed by the appellant in reply to the notice under section 148 of the Act. 3. The assessee has also filed petition for admission of additional grounds stating that certain observations of the CIT(Appeals) came to the notice of assessee pursuant to filing of the appeal before the Tribunal which was inadvertent bonafide mistake on the part of assessee and prayed that the same may be admitted for adjudication. The additional grounds are as follows:- 8. The learned AO/CIT(A) has erred in law and facts in not giving the benefit of short term capital los ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal before us. 8. The assessee s main grievance is with regard to initiation of reassessment proceeding u/s. 147 of the Act without any authority of law whatsoever. It was submitted that the assessment was reopened by recording the following reasons:- The assessee company has made Slump sale during the year to M/s.N.F.Wireless India Private Limited for a consideration of ₹ 13,96,91,650/-. After making adjustment towards assets and liabilities the net worth is arrived at ₹ 38,94,54,208/-. In the computation of capital gains on slump sale the assessee has reduced ₹ 38,94,54,208/-. In the computation of capital gains on slump sale the assessee has reduced ₹ 32,76,86 270/- being goodwill allocated based on form 3cn . As per the Local Business Transfer Agreement dated: 22.07.2008, Goodwill is not treated as a part of consideration in the Business Transfer Agreement. Hence, the assessee had made a wrong claim of ₹ 32,76,86,370,1- as goodwill in the computation of capital gains. 1 therefore, have reason to believe that income of ₹ 32,76,86,370/- has escaped assessment within the meaning of section 147 of the Income Tax Act, ig6i which requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lhi High Court) 8. CIT vs Kelvinator of India Ltd (2010) 320 ITR 561 (Supreme Court) 9. Legato System (India) Pvt Ltd vs DCIT (2010) (187 Taxman 294) (Delhi High Court) 10. CIT Vs Ramakrishna Hegde (326 ITR 347) (2010) (Karnataka High Court) Reassessment based on audit objection is void ab initio 11. Indian and Eastern Newspaper Society vs CIT (119 ITR 996) (Supreme Court) 12. Raj Ratna Metal Industries Ltd vs ACIT (SLP No. 7140 of 2014) (Gujarat High Court) 13. Commissioner of Income Tax -12 vs DRM Enterprises [2015] 55 Taxmann 181 (Bombay High Court) Reassessment based on audit objection is void ab initio 14. Indian and Eastern Newspaper Society vs CIT (119 ITR 996) (Supreme Court) 15. Raj Ratna Metal Industries Ltd vs ACIT (SLP No. 7140 of 2014) (Gujarat High Court) 16. Commissioner of Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resentatives appeared nor filed any submissions but took adjournment on 4.8.2017 and 20.11.2017. None appeared further on 28/08/2017 and 04/12/2017. Thereafter a final hearing notice dated 21/12/2017 fixing on 02/01/2018 at 11:30 am has also been issued. However, neither the appellant nor any of his AR appeared nor filed any submissions and also not took adjournment on the above mentioned dates for appearing. Subsequently the CIT(A) office called the appellant many a times to appear before but the appellant neither himself nor his AR appeared. In view of the same the CIT(A) was of the opinion that the appellant is not seriously interested in pursuing his appeals. The law aids those who are vigilant and not those who sleep upon/over their rights. This principle is embodied in well known dictum Vigilantibus non Dormantibus Jura sub Veniunt which has been followed in the case of CIT Vs. Multiplan India Ltd. reported in 38 ITD 320 by the Hon'ble Delhi High Court. Therefore, the grounds of appeal should have been dismissed for want of prosecution. However, for the advancement of substantial cause of justice and equity, the grounds raised by the appellant were decided on merits based ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore the ground on challenging the re-opening of the assessment was dismissed. 12. We have heard both the parties and perused material on record. In this case, original assessment was completed u/s. 143(3) of the Act for this AY 2009-10 and draft assessment order was passed on 14.3.2013. The assessee filed appeal before the CIT(Appeals). Thereafter, the AO passed final assessment order on 30.4.2013. The assessee filed appeal against this order before the CIT(Appeals) on 12.6.2013 with regard to adjustment made by the AO on the TP issue. The CIT(Appeals) vide his order dated 20.10.2004 upheld the TP adjustment made by the AO, However, he directed the AO to grant depreciation at the prescribed rate applicable to furniture fittings in respect of server racks, however with regard to depreciation on networking equipment/active components etc., the CIT(Appeals) decided the issue in favour of assessee allowing depreciation @ 60% against which the revenue filed appeal before the Tribunal. 13. With regard to non-grant of depreciation on the basis of additional ground in respect of depreciation on goodwill which was acquired by NXP India from Philips Electronics India Ltd. and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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