9911796707
TMI Blog2021 (10) TMI 1018X X X X Extracts X X X X X X X X Extracts X X X X ..... 2008-09 vide order dated 16/06/2014. 2. The brief facts of the case are that the assessee, a partnership firm in contract business, was assessed at a total income of Rs. 6,19,810 for the relevant year vide assessment u/s. 143(3) of the Act dated 23.12.2010 (PB pgs. 45-47). Subsequently, notice u/s. 148(1) was issued on 29.7.2013, and its' income reassessed at Rs. 12,81,445 (Rs. 12,81,450) by disallowing interest (Rs. 1,98,930) and remuneration (Rs. 4,62,705) to partners. It is the reopening of assessment as well as the disallowance on merits that is challenged in the instant appeal. The respective cases 3.1 The assessee's case qua reopening is that it is a case of change of opinion inasmuch as no new material had been brought on record o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -signing by them the front pages of the deed. Shri Modh, the ld. counsel for the assessee, would also quickly address the other two reasons informing the AO's reason to believe escapement of income from tax, i.e., as per the reasons recorded. One, that the return of income was filed on 28.10.2009 (correct date: 02/10/2009) as against the due date of 30.9.2008. The same does not by itself, by any stretch of imagination, lead to any valid reason to believe escapement of income from assessment. Two, interest to senior citizen at Rs. 1,87,083 was allowed in violation of section 40(a)(ia) as there was no proof of the payee being, as claimed, a senior citizen. Declaration from the depositor in Form-15H stood duly submitted to the Department on 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he purview of the question that requires to be addressed so as to answer the assessee's challenge to the assumption of jurisdiction, i.e., the validity the reasons/s recorded u/s. 148(2). It is not necessary at this stage to discuss the disallowance on merits. 4.2 The first thing that needs to be clarified is if the reason/s to believe escapement of income from assessment to tax based on an audit objection could be a valid reason. The matter, which was subject to difference of opinion by different High Courts, has been settled by the Apex Court in Indian & Eastern Newspaper Society vs. CIT [1979] 119 ITR 996 (SC). It was explained that while a matter of fact could be validly brought to the notice of the assessing authority by the internal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pages of revised partnership deed submitted does not bear the signatures of the partners which is one of the requirements of the deed as and when revised. The photocopy of the deed has been notarized on 4/10/2010 whereas the deed is effective from 01/04/2007. Also, it cannot be ascertained from the copy of the deed as to when the non-judicial stamps were purchased. The matter needs to re-examined for contravention to the provision of the section 184 of the I.T. Act.' In my view, the said condition is clearly satisfied qua the afore-stated reason. The assessee admittedly did not file the certified copy of the revised partnership deed dated 1.4.2007 along with the return of income, as required by law, and which (return of income) was itsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly on 04/2/2010, further two years later, i.e., during the course of the assessment proceedings. 4.4 Next, I may discuss the reasons recorded. About the first two, the lesser said the better inasmuch as they are both legally and factually infirm. Late furnishing of the return of income by itself affords no ground to entertain any reason to believe escapement of income from assessment. Likewise, there is no allegation of non-filing of the declaration (F-15H) by the assessee, which only could lead to a valid reason to believe disallowance u/s. 40(a)(ia), not effected in the original assessment. No wonder, the ld. Sr. DR, Ms. Agarwal did not respond to the Revenue's case qua these two reasons in her arguments. Coming to the third and the las ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eason to suspect, and not a reason to believe for want of the relevant information. Both the reasons recorded are, thus, not valid grounds for reopening, which, accordingly, fails. The same have in fact not been discussed by the ld. CIT(A). 4.5 During hearing, a number of other arguments were also assumed by the parties, viz. the validity of a partnership deed on a plain paper; the non-signing of the revised deed by the outgoing partner, Sh. Deocharan Mishra, i.e., in original, which was therefore also not certified by him, etc. All these do not form part of or even arise from the reasons recorded, which cannot be supplemented, and therefore to no consequence. It is this that led to the observation, at the beginning of the findings by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
