TMI Blog2021 (5) TMI 330X X X X Extracts X X X X X X X X Extracts X X X X ..... ening of assessment, then they have got every reason to believe that the assessment is to be reopened. In the event of not reopening the assessment, the interest of the Revenue would be prejudiced. This Court is of the considered opinion that the petitioner cannot merely say that he has produced all the informations. Certain informations, which were not provided fully and truly caused loss to the Revenue with reference to the deductions made u/s 80-IA of the Act and such materials identified by the Department, while reopening the assessment must be adjudicated with reference to the documents and evidences available and the petitioner is at liberty to defend his case by submitting his objections or by producing documents and evidences. High Court cannot adjudicate the intricacies in the Accounting System made by the assessee, which was scrutinized by the Income Tax Department. When prima facie case made out by the respondents to arrive a conclusion that there is a reason to believe, then the Revenue must be permitted to proceed with the reopening proceedings and mere reopening would not cause any prejudice to the assessee and during adjudication, the assessee would get an op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 80-IA is claimable from any year within 15 years from the date of commencement of operations of the assessee, subject to the cap of 10 consecutive years for availment of the benefit was duly notified and communicated in the submissions made by the petitioner before the respondent. Meanwhile, the return of income was processed under Section 143(1) of the Act, determining total refund of ₹ 1,41,39,871/-. During the course of assessment hearing on 13.08.2008 under Section 143(3), the assessment officer called for various details / clarifications and all such details and clarifications were provided by the petitioner / assessee to the Assessing Officer along with the documents. Having satisfied with the documents as well as the informations provided by the petitioner / assessee, the Assessing Officer passed a final assessment order under Section 143(3) of the Income Tax Act on 28.11.2008. The Assessing Officer accepted the contentions of the petitioner / assessee for the purpose of claiming benefit under Section 80- IA of the Act. The issues were adjudicated and concluded. Subsequently, the respondents have initiated proceedings under Section 147 of the Act for reopening of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... beginning from the year in which the undertaking as the enterprise develops and begins to operate any infrastructure facility or starts providing telecommunication service or develops and industrial park or generates power or commences transmission or distribution of power. 5. W.P.No.6858 of 2015 : The petitioner is engaged in the business of providing Telecommunication Services and operates in the Chennai Circle pursuant to the License granted by the Department of Telecommunications, Government of India. Pursuant to the commencement of business operations during the Assessment Year 1996-97, the petitioner started claiming the deduction under Section 80-IA of the Act from AY 2005-06. In its return of income submitted for the Assessment Year 2007-08, as initially filed on 31.10.2007 and subsequently, revised on 04.03.2010, the petitioner /assessee claimed deduction under Section 80-IA of the Act amount to ₹ 124,60,36,702/-. Subsequently, the return of income has filed for the Assessment Year 2007-08 was selected for scrutiny. The petitioner / assessee, duly filed its written submission dated 12.08.2010, providing details regarding the claim under Section 80-IA of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts written submission dated 17.08.2010, providing details regarding the claim under Section 80-IA of the Act. Relevant documents and extracts thereof were highlighted which would demonstrate that the claim for deduction in terms of Section 80-IA is claimable from any year within 15 years from the date of commencement of operations of the assessee, subject to the cap of 10 consecutive years for availment of the benefit was duly notified and communicated in the submissions made by the petitioner before the respondent. Meanwhile, the return of income was processed under Section 143 of the Act. The purported reasons and justifications as required and mandated under law, have been provided vide communication from the respondent dated 08.10.2014. It is further stated that the inordinate and inexplicable gap between the issuance of the notice and the furnishing of purported reasons for reopening of the assessment is itself fatal to the impugned re-assessment proceedings as per settled judicial precedents. Further, the reasons for re-opening is based on a change of opinion on the part of the respondent/department and it is without jurisdiction as there are no new facts / material, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 147 of the Act. 10. The learned counsel for the respondent objected the contentions raised on behalf of the petitioner by stating that it is not the change of opinion. There are concrete materials to arrive a conclusion that there is a reason to believe as required under Section 147 of the Act. Even an under assessment or otherwise is a ground for reopening of assessment. In the present case, any erroneous claim made resulting under assessment, would constitute a ground for reopening of assessment by the Assessing Officer by invoking Section 147 of the Act. The benefit claimed by the petitioner under Section 80-IA may be the common ground raised. However, the Intricacies and the manner, in which, such claim was made by the petitioner, constitutes a fresh ground for the purpose of reopening of assessment and therefore, such informations or materials is to be construed as new materials, which were not adjudicated by the Assessing officer at the time of passing original assessment order. 11. With reference to the clarification issued by the CBDT in Circular dated 15.02.2016 that the petitioner has a right to claim within 15 years from the date of commencement of business oper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e for the purpose of reopening of assessment, then it is to be construed that the Assessing Officer has reason to believe and the assessee would get ample opportunity to defend the case in the manner known to law. If the assessee has got certain reasons / clarifications / defense, then all such defense or documents are to be produced before the Assessing officer at the time of assessment. Contrarily, High Court in a writ proceedings, cannot adjudicate all such disputed facts and circumstances raised between the parties. Disputed facts are to be adjudicated with reference to the documents, evidences and materials available on record and such an exercise is impermissible in a proceedings under Article 226 of the Constitution of India. Thus, what is required is, whether any one of the circumstances as contemplated under Section 147 of the Income Tax Act is attracted with reference to the initiation of proceedings under Section 147 and if the Court formed an opinion that there is a reason to believe for reopening of assessment, then the same would be sufficient to proceed with the case by the Assessing Officer. However, the Sufficiency of the reasons cannot be gone into by the High C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the undertaking as the enterprise develops and begins to operate any infrastructure facility or starts providing telecommunication service or develops and industrial park or generates power or commences transmission or distribution of power. The initial assessment years is to be taken as AY 1996- 97 and the assessee is eligible only for 30% of the deduction claim and remaining 70% is to be taxed. Hence, deduction under Section 80-IA should be restricted to ₹ 26,18,90,989/- and excess claim of ₹ 61,10,78,973/- is to be disallowed. As per the reasons recorded above and there is a failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. There is a definite 'reason to believe' that the dedution of ₹ 61,10,78,973/- is excess deduction to the tune the income chargeable to tax has escaped assessment. 15. The Deputy Commissioner of Income Tax issued proceedings, disposed of the objections raised by the petitioner / assessee wherein it is stated regarding the provisions of Section 80-IA as under: Provisions of Section 80-IA: The assessee contends that it has claimed the deduction under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eference to the deductions made under Section 80-IA of the Act and such materials identified by the Department, while reopening the assessment must be adjudicated with reference to the documents and evidences available and the petitioner is at liberty to defend his case by submitting his objections or by producing documents and evidences. 17. High Court cannot adjudicate the intricacies in the Accounting System made by the assessee, which was scrutinized by the Income Tax Department. When prima facie case made out by the respondents to arrive a conclusion that there is a reason to believe, then the Revenue must be permitted to proceed with the reopening proceedings and mere reopening would not cause any prejudice to the assessee and during adjudication, the assessee would get an opportunity to defend his case in the manner known to law. Thus, the mere initiation based on some new materials would not cause any prejudice or violate the rights of the assessee. However, if the assessee could able to establish that there is absolutely no new materials or informations made available for the purpose of reopening of assessment, then alone, the High Court may interfere and not otherwis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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