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TMI Blog2022 (1) TMI 530X X X X Extracts X X X X X X X X Extracts X X X X ..... reciating that the fact that the Assessee had entered into a BOT agreement with the Government was well within the knowledge of the AO at the time of passing of the Original Assessment Order. 2.1 The Commissioner of Income Tax (Appeals) erred in not considering the claim of depreciation on right to collect toll as the same is considered an intangible asset, merely because he claim was not made in the return of income. 2.2 The Commissioner of Income Tax (Appeals) failed to appreciate that it is a settled principle that a fresh claim can be entertained at the time of re-assessment as per the provisions of the Act and decisions of various Courts. 3. The Commissioner of Income Tax (Appeals) erred in holding that the Assessee is not eligible to claim depreciation on the right to collect toll is contrary to the decisions of Tribunals and High Courts in this regard. 4. The Commissioner of Income Tax (Appeals) has erred in not considering the case laws filed by the Assessee in its support and arbitrarily rejecting them as not applicable to the facts of the case." 3. The assessee has assailed two solitary grounds, out of which, the first ground relates to reopening of assessment an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s invalid. After considering the explanation of the assessee as well as reasons for reopening of assessment, the ld. CIT(A) has observed that the assessee did not file all the facts in the return filed pertaining to its status as a contractor of the Tamil Nadu Government and thus failed to disclose fully and truly the relevant facts material for the assessment. Thus, the ld. CIT(A) has held that it cannot be said that the assessment was reopened on the basis of change of opinion and confirmed the reassessment order. 5. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has reiterated the submissions as made before the ld. CIT(A). 6. On the other hand, the ld. DR strongly supported the orders of authorities below. 7. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. In this case, the assessee has claimed depreciation at 25% by treating the bridge as Plant and Machinery. The Assessing Officer treated the bridge as only a building and allowed depreciation at 10%. Subsequently, the return filed by the holding company of the assessee i.e., East Coast Construction a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evelopment of the bridge is to be treated as having been incurred for the purposes of the business of the assessee and directed the Assessing Officer to be allowed to be amortized during the tenure of the agreement. 9. Before us, the ld. Counsel for the assessee has reiterated the submissions as made before the ld. CIT(A). 10. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. First of all, the assessee could not controvert the fact that the assessee is only a contractor and not owner of the bridge and thereby, the assessee is not entitled to claim depreciation. Secondly, the claim of depreciation on the expenditure incurred on development and construction of infrastructural facilities including bridges on BOT basis with right to collect toll has been clarified by the CBDT that the assessee do not hold any right in a BOT project except recovery of toll free to recoup the expenditure incurred and therefore, the assessee cannot be treated as the "owners" of the property and cannot be allowed depreciation under section 32(1)(ii) of the Act. By considering the above notification of the CBDT, considering all the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee to disclose fully and truly all the materials to complete the assessment. Subsequently, the assessment was completed under section 143(3) r.w.s. 147 of the Act. In this case, the assessment was originally completed under section 143(1) of the Act, though, subsequently, reopened beyond four years, the change of opinion does not arise for the reason that under section 143(1) of the Act, it is a simple process of the return of income and therefore, there is no application of mind by the Assessing Officer. Apart from the above, the assessee failed to disclose all the material facts before the Assessing Officer to complete the assessment. Therefore, the Assessing Officer has correctly reopened the assessment under section 147 of the Act and thus, the ground raised by the assessee is dismissed. 15. So far as merits of the case are concerned, we have decided the issue of depreciation claim hereinabove in the assessment year 2003-04 in ground No. 2 raised by the assessee and the above order is squarely applies to the assessment year 2004-05 also and accordingly, the claim of depreciation stands dismissed. I.T.A. No. 3109/Chny/2018 [AY: 2005-06] 16. The first ground raised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct and the Assessing Officer had no occasion to form an opinion for reopening of assessment and therefore, the change of opinion does not arise. In this case also, we find that there is failure on the part of the assessee to disclose fully and truly all material facts for completing the assessment and therefore, the Assessing Officer has rightly reopened the assessment and the same was confirmed by the ld. CIT(A). Thus, we find no infirmity in the order passed by the authorities below. 20. So far as merits of the case are concerned, we have decided the issue of depreciation claim hereinabove in the assessment year 2003-04 in ground No. 2 raised by the assessee and the above order is squarely applies to the assessment year 2008-09. Accordingly, the claim of depreciation stands dismissed. 21. The next ground raised by the assessee relates to confirmation of disallowances of other expenses of Rs. 26,42,583/- and the Assessing Officer has disallowed the same on the ground that the assessee has not carried out any business. In the financial year 2005-06 itself, the Tamil Nadu Government vide its G.O.Ms. No. 165/166 dated 19.12.2005 cancelled the BOT agreement and therefore, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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