TMI Blog2021 (8) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by the learned counsel for the assessee, and to deal with the other grounds of appeal. All other grounds of appeal must therefore be held to be academic and infructuous at this stage. We uphold the plea of the assessee and reopening of the reassessment proceeding is quashed. We also see no need to address the other grounds of appeal, on merits, which have been, given our findings on the validity of reassessment proceedings, rendered academic and infructuous. - ITA No. 3402/Mum/2019 - - - Dated:- 28-7-2021 - Pramod Kumar (Vice President) And Saktijit Dey (Judicial Member) For the Appellant : F.V Irani For the Respondent : Rajeet Harit ORDER PER PRAMOD KUMAR VP: 1. By way of this appeal, the assessee-appellant has challenged the correctness of the order dated 27th March 2019, passed by the learned CIT(A) in the matter of assessment u/s. 143(3) r.w.s 147 of the Income Tax Act, 1961 (hereinafter referred to as the Act ) for the assessment year 2007-08. 2. Grievances as set out in the memorandum of appeal filed before us are as follows:- (1) On the basis of facts and circumstances of the case, the Learned CIT(A) erred in confirming action of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es he has strong arguments to make on merits of these grounds. It is in this back drop and having heard the rival contentions as also having perused the material on record, we deem it fit and proper to admit the additional grounds of appeal as prayed. As the additional grounds deal with a foundational jurisdictional issue, we also deem it appropriate to take up the additional grounds of appeal first. 5. It is a case of reopened assessment. The aassessment under section 143(3) of the Act was originally completed on 22nd December 2009, assessing the income at ₹ 26,809.96 crores However, on 29th March 2014, the Assessing Officer issued a notice u/s. 148 of the Income Tax Act which was accompanied by reasons for reopening set out in annexure A to the said petition. The reasons as recorded for reopening the assessment are as follows: The assesses filed a income Tax Return for A.Y. 2007-08 on 30-10-2007 declaring total income at ₹ 12792,10,38,530/- The assessment was completed u/s 143(3) on 22-12-2009 the total income was determined at ₹ 26809,96,56,770/. The company is engaged in the business of Life Insurance. Revenue audit raised the audit objection is as unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vide that proceedings u/s. 147 can be initiate inspite of the fact that full facts has already been disclosed in I.T Return. Verification of case record revealed that the assessee has claimed deduction of 50% of donation made to Golden Jubilee Foundation Trust u/s. 80G amounting to ₹ 25.00 crore. The department assessed the income of the assessee at ₹ 26809.96 crore in the original scrutiny completed on 22/12/2009, where in the deduction u/s. 80G was not disallowed. While giving effect to CIT(A) s order in April 2012 revising income to ₹ 16914.08 crore. The deduction u/s. 80G was not disallowed. In this connection it is revealed to point out that the assessee while arriving valuation surplus, which offered to tax, included all income and expenses including the donations made to trust, once it was claimed in arriving valuation surplus, again allowing u/s. 80G of such donation, tantamount to allowing double deduction of amount equivalent to 50% of donation. This incorrect allowance of deduction resulted in under assessment of income by ₹ 25.00 crore. It is also observed that the department further given effect to second appeal in August 2013, revising income t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee. Rejecting the arguments, learned CIT(A) observed as follows:- 4.12 The arguments put forward by the appellant are considered. It is seen that the issue of disallowance of claim of donation u/s. 80G of the Act was not dealt in the original assessment order completed on 22/12/2009. The deduction u/s. 80G was also not disallowed while passing the order giving effect to the order of CIT(A) ITAT. 4.13 It needs to be understood that the issue of disallowance of donation under section 80G was not examined in the original assessment and orders giving effect. The issue of disallowance of claim of deduction u/s. 80G discussed in detail in the earlier paragraphs of this order. It would be clear from the discussion that the issue is based on the crucial information that the appellant had debited the expenditure on account of the donation to its revenue account while computing the actuarial valuation as per the section 44 of the Act and schedule 2. This information is necessary to form opinion about the allowability of claim of deduction under section 80G of the Act. The assessee could have provided this information while filing of return of income in the form of qualific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer cannot be supplemented by filing an affidavit or making an oral submissions otherwise the reasons which were in the material particulars would get supplemented by the time the matter reaches courts on the strength of affidavit or oral submissions . He submits that such being the esteemed views of Hon ble jurisdictional High Courts we have to see the reasons recorded on entirely standalone basis. It is then pointed out that since these reasons do not allege any failure on the part of the assesseee, the reopening must be held to be invalid for this reason alone. Learned counsel for the assesseee stated without prejudice to his fundamental arguments as stated above that in any way there has been no failure on the part of the assessee in as much as the fact remains that the claim that profits have been computed in terms of rule 2 of the first schedule of the Income Tax Act and set out in the computation of income which is placed at page one of the paper book. Learned counsel for assessee invited our attention to show cause notice issued by the Assessing Officer on this specific point and the reply given by the assessee pointing out the manner in which the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the facts of the issue involved in the light of the applicable legal position. 14. A plain look at the reasons for reopening of the assessment as reproduced above would show that at no stage any allegation has been made out in these reasons of any failure on the part of the assessee as referred to in proviso to section 147. It is important to bear in mind the fact that in terms of proviso to under section 147, as it then stood, where the assessment is completed under section 143(3), no action can be taken under section 147 after the expiry of four years from the end of the relevant previous year unless any income chargeable to tax has escaped assessment for such assessment year by reason of, inter alia, failure on the part of the assessee to disclose fully and truly all material facts necessary for reassessment. It is well settled in law that the reasons as recorded for reopening the assessment are to be examined on a standalone basis. Nothing can be added to the reasons recorded nor anything can be deleted from the reasons recorded. Hon ble Bombay High Court in the case of Hindustan Lever Ltd vs. R.B Wadkar, ACIT Others (2004) 268 ITR 339 (Bom), has inter alia has observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer for reopening this assessment, we find that there is no allegation to the effect that there has been any failure on the part of the assessee to fully and truly disclose all material facts necessary for the assessment. Unless an allegation to this effect is made in the reasons recorded by the Assessing Officer, in a situation where the assessment is being sought to be reopened after four years from end of the relevant assessment year and when the original assessment was completed u/s. 143(3), the jurisdiction to carry out the reassessment cannot be lawfully assumed. For this short reason alone, the impugned reassessment proceedings must be held to be vitiated in law. 16. As we have come to a conclusion based on this reason itself that the reassessment proceeding are vitiated in law, we don t find it necessary to deal with other arguments raised by the learned counsel for the assessee, and to deal with the other grounds of appeal. All other grounds of appeal must therefore be held to be academic and infructuous at this stage. 17. We may make it clear that once Hon ble jurisdictional High Court has the words of guidance on a particular issue, it cannot be open to us to r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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