TMI Blog2023 (1) TMI 608X X X X Extracts X X X X X X X X Extracts X X X X ..... arlier, the said information was no new information provided by the assessee to the ld. AO as the assessee had only re-furnished the very same information that is already available with the ld. AO in the assessment record. Hence, it could be safely concluded that there is absolutely no tangible material available with the ld. AO having live link to form a belief that income of the assessee had escaped assessment. Hence, reopening of the assessment fails on this count itself. Reopening could be made to examine another facet of the same claim of deduction - This was subject matter of adjudication by the Hon ble Gujarat High Court as rightly pointed by the ld. AR before us in the case of QX KPO Services (P.) Ltd.[ 2018 (3) TMI 1664 - GUJARAT HIGH COURT] wherein as settled legal position that when a particular claim has been scrutinized by the Assessing Officer at the time of original assessment, as such, the Assessing Officer cannot reopen such assessed case in order to examine another facet of the same claim. The assumption of jurisdiction under Section 147 of the Act by the Assessing Officer of issuing notice under Section 148 of the Act is without the authority of law and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the consent of both the parties, the cross appeals for the A.Y.2008-09 is taken up for adjudication as the lead case and decision rendered thereon shall apply with equal force for A.Yrs. 2009-10 and 2010-11 also except with variance in figures. 2. The first identical issue to be decided is as to whether the ld. CIT(A) was justified in upholding the action of the ld. AO in assuming jurisdiction for reopening the assessment u/s.147 of the Act in the facts and circumstances of the instant case. The interconnected issue involved thereon on merits is as to whether the ld. CIT(A) was justified in deleting the addition made on account of CENVAT credit and consequently reduction in claim of deduction u/s.80IA of the Act in the sum of Rs.2,17,27,798/- in the facts and circumstances of the instant case. 3. We have heard the rival submissions and perused the materials available on record. The return of income for A.Y.2008-09 was filed by the assessee company on 30/09/2008 declaring total income of Rs.182,39,78,434/-. In the return of income, the assessee claimed deduction u/s.80IA of the Act of Rs.37,73,46,886/- in respect of captive power plant units. The assessment was completed u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tum of excess deduction claimed by the assessee company, notice(s) U/s 133(6) were issued (after taking due approval of CIT-LTU, Mumbai), calling for the information of such CENVAT element as is attributable to the consumption of raw material and other services in direct relation to these captive Power Plants (CPP's). As per the details so gathered it is seen that am amount of Rs 6,15,92,898/- was not included in purchase / cost expenses debited in P L a/c of these CPP's, and accordingly I have reasons to believe that the assessee company has claimed an excess deduction U/s 80IA(4) to the extent of Rs.6,15,92,898/-. Therefore, there is a reason to believe within the meaning of section 147 of the Income Tax Act, 1961 that the income chargeable to tax, to the extent of Rs. 6,15,92,898/- has escaped assessment, and subsequently come to notice of the undersigned. The fault for the this escapement lies on the part of the assessee, in the sense that Assessee company has failed to disclose true particulars of the deduction claimed u/s 801A. As there is a failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment, I have a r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat it is not open to the Revenue to reopen the assessment and revisit the claim of deduction u/s.80IA of the Act on a completely different facet. Reliance in this regard was also placed on the decision of the Hon ble Gujarat High Court by the ld. AR in the case of QX KPO Services (P.) Ltd. vs DCIT reported in 94 taxmann.com 467 (Gujarat). 3.3. The ld. AO in the re-assessment order had also stated that notice u/s.133(6) of the Act was issued to the assessee calling for information of CENVAT element as is attributable to the consumption of raw material and other services in direct relation to captive power plants of the assessee. This notice u/s.133(6) of the Act was issued on 16/03/2015 to the assessee which is enclosed in page 60 of the paper book filed before us. We find that assessee had duly replied to the said notice u/s.133(6) of the Act seeking certain information vide letter dated 23/03/2015 by furnishing the requisite details called for. This reply letter is enclosed in pages 61-76 of the paper book filed before us. In fact in the said reply, the assessee had merely refurnished the tax audit report annexure filed by it along with return of income before the ld. AO. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant for the purpose of framing the assessment. This aspect is relevant in view of the fact that the reopening for A.Y.2008-09 had been made beyond four years from the end of the relevant assessment year and hence, the proviso to Section 147 of the Act would come into operation. Though the ld. AO in the reasons recorded had stated that there is a failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment, we are unable to comprehend ourselves to accept to this statement of the ld. AO in view of the fact that assessee had given all the relevant details before the ld. AO in the original scrutiny assessment proceedings itself and also in the tax audit report and the audit report filed in the prescribed format in the computation of deduction u/s.80IA of the Act along with original return of income itself. Moreover, even the information that is sought by the ld. AO u/s.133(6) of the Act was also furnished by the assessee by simply refurnishing very same data that is available in the tax audit report and the section 80IA audit report which was already filed along with return of income. There is absolutely no basis for the ld. AO to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther argued that during the scrutiny assessment, the Assessing Officer had minutely examined benefit of deduction under Section 10B of the Act and had chosen not to make any disallowance in respect of the claim of deduction under Section 10B of the Act, while framing assessment under Section 143 [3] of the Act. It is further submitted that for AY 2008-2009 also, deduction under Section 10B of the Act was denied by the respondent and such disallowance was confirmed by the Commissioner of Income-tax [Appeals]. The issued was decided by this Court in Tax Appeal no. 439 of 2016 and the appeal preferred by Revenue was dismissed on 14th June 2016. That, benefit under Section 10B of the Act was granted to the petitioner from the first year of its claim [ie., AY 2007-2008] and subsequent years, and therefore, the petitioner cannot be denied claim for deduction under Section 10B of the Act for the year under consideration. That, the respondent is not permitted to make any disallowance under Section 10B of the Act in case of the petitioner, and therefore, question of escapement of income chargeable to tax would not arise. Hence, it was requested by learned advocate for the petitioner to qua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 19th September 2013, the petitioner furnished required details to the respondent explaining the claim of deduction under Section 10B of the Act [as at Annexure E collectively]. The Assessing Officer then was convinced with the explanation given by the petitioner claiming deduction under Section 10B of the Act and accepted the return for the year under consideration by making no disallowance in respect of the claim of deduction under Section 10B of the Act, while framing assessment under Section 143 [3] of the Act, by his Order dated 6th January 2014. It also appears from the decision rendered by this Court dated 14th June 2016 passed in Tax Appeal No. 439 of 2016 that for the Assessment Year 2008-2009, deduction under Section 10B of the Act was claimed by the petitioner, which was denied earlier. CIT [A] also disallowed the deduction claimed by the petitioner. In second appeal before the ITAT, the claim made by the petitioner under Section 10B of the Act was allowed by an Order dated 4th November 2015. Against this order, the Revenue preferred Tax Appeal No. 439 of 2016 and this Court was pleased to dismiss the above said Appeal by an Order dated 14th June 2016 for A.Y 2008-200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw. The law is very well settled that no re-assessment could be made merely based a change of opinion. Hence the reopening made in the instant case deserves to be quashed on this count also. 3.10. Even on merits, we find that the main grievance of the Revenue is that the assessee had not debited certain expenses in the eligible unit i.e. 80IA units and thereby had claimed excess deduction u/s.80IA of the Act in the return of income. We find that this aspect has been addressed elaborately by the ld.CIT(A) and the ld. CIT(A) had deleted the said disallowances by placing reliance on various decisions of Tribunals, High Courts and Supreme Court and granted relief to the assessee. Relevant observation of the ld. CIT(A) are as under:- 6.3 I have carefully perused the facts of the case and arguments advanced by the AR The AO has observed that the appellant is booking the expenses in its P L account net of CENVAT which is shown separately in balance sheet under CENVAT receivable account. The AO held that 80-IA unit has to be looked upon viewed as standalone unit and in computing all the business expenses including duties and taxes has to be taken into account to arrive at correct an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to income tax under the head profits and gains of business or profession If cash assistance received or receivable against exports schemes are included as being income under the head profits and gains of business or profession , it is obvious that subsidies which go to reimbursement of cost in the production of goods of a particular business would also have to be included under the head profits and gains of business or profession , and not under the head income from other sources The Hon'ble Delhi High Court in the case of CIT vs. Dharam Pal Prem Chand Ltd reported in 317 ITR 353 had decided that: The finding of the authorities below was that the refund of excise duty was pivoted on the manufacturing activity carried on by the assessee. Once such a finding of fact had been returned, there was no need to go further and to examine the immediate and proximate source of refund of excise duty. As a matter of fact, in the questions proposed by the revenue, there was no specific question that the said finding of the authorities below was perverse. There was of course a very broad-based and general question that the order passed by the Tribunal was perverse, in l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Department against order of Delhi High Court on 22.02.2010. As is clear, the Notification dated 14.11.2002 exempts the amount of paid ensure proper control over the transactions, the Notification only requires the manufacturers to first deposit the excise duty and then claim the refund of the same next month. Thus the refund is assessee's own money itself in a way security deposit which is being refunded on submission of the evidence depositing the same. Therefore, in our view this is not an income at all. Therefore, the A.O, in our view, was not justified in making a separate addition of income and thereby denying the relief eligible u/s 80.IB of the Act on that amount. Thus, respectfully following the judicial decisions cited supra and considering the facts of the case, hold that the appellant is eligible to claim the deduction u/s 80IA of I.T. Act. 1961, I direct the AO to delete the disallowance of deduction u/s 80IA of Rs.2.17.27.798/- made in the assessment order. Accordingly, Ground No 2 is hereby Allowed. 3.11. We further find that the similar issue had arose before this Tribunal in the case of Ambuja Cements Ltd vs. Addl. CIT in ITA No.2384 3475/M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and, to that extent, the profits stood distorted/ inflated. These allocations were done on the basis of turnover in the absence of any item wise details . Aggrieved, inter-alia, by these adjustments on account of CENVAT credit, assessee carried the matter in appeal before the CIT(A) but without success. The assessee is not satisfied and is in further appeal before us. 101. We have heard the rival contentions, perused the material on record and duly considered the fact of the case in the light of the applicable legal position. 102. We find that Section 80IA(5), which has been heavily relied upon by the assessee, provides that notwithstanding anything contained in any other provision of this Act, the profits and gains of an eligible business to which the provisions of sub-section (1) apply shall, for the purposes of determining the quantum of deduction under that sub-section for the assessment year immediately succeeding the initial assessment year or any subsequent assessment year, be computed as if such eligible business were the only source of income of the assessee during the previous year relevant to the initial assessment year and to every subsequent assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arious judicial precedents, the reopening made by the ld. AO for A.Y.2008-09 is bad in law and is hereby quashed. Accordingly, the appeal of the assessee is allowed. On merits, the issue is already covered in favour of the assessee by relying the decision of this Tribunal in the case of Ambuja cements referred to supra. Accordingly, the grounds raised by the Revenue are dismissed. 4. In the result, appeal of the assessee for A.Y.2008-09 is allowed and appeal of the Revenue for A.Y.2008-09 is dismissed. ITA No.7643/Mum/2019 (Revenue Appeal) ITA No.7641/Mum/2019 (Assessee Appeal) (Assessment Year :2009-10) 5. The ground raised by the assessee and Revenue for A.Y.2009-10 are exactly identical with those raised for A.Y.2008-09 except with variance in figures. Hence, the decision rendered by us for A.Y.2008-09 for both assessee as well as Revenue appeal shall apply mutatis mutandis for this Assessment year also. 6. The ld. AR drew our attention to the letter dated 17/03/2022 wherein certain additional grounds were raised by the assessee for certain issues for the A.Y. 2009-10 on merits. These additional grounds were stated to be not pressed by the ld. AR at the time o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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