TMI Blog2023 (8) TMI 1176X X X X Extracts X X X X X X X X Extracts X X X X ..... eve that income chargeable to income tax has escaped assessment and secondly he must also have reason to believe that such escapement has occurred by reason of omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that assessment year. Since in the present case proviso to section 147 is applicable, AO has to bring on record both the above said conditions on record. Since the AO has not brought on record how the escapement of income has occurred by reason of omission or failure on the part of the assessee to disclose fully or truly all material facts necessary of the assessment, therefore the reopening of assessment is bad in law. The assessment passed u/s.143(3) r.w.s. 147 is bad in law and it is quashed. Decided in favour of assessee. - SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER AND MS KAVITHA RAJAGOPAL, HON'BLE JUDICIAL MEMBER For the Assessee Represented by : Shri Surinder Mehra For the Department Represented by : Dr. Mahesh Akhade Shri Chetan Kacha ORDER PER S. RIFAUR RAHMAN (AM) 1. This appeal is filed by the assessee against order of Learned Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Profit and Loss account that foreign travel expenses of ₹.28,09,232/- was incurred by the assessee and assessee was asked to show cause why the foreign travel expenses of ₹.28,09,232/- be not disallowed u/s 37(1). 6. In response, assessee submitted that the expenses were incurred in relation to the business of the assessee and gave detailed submissions relating to the trips made by the Directors of the company to London and New York. 7. The Assessing Officer after considering the above submissions observed that assessee has made the claim of travel expenses to London without there being any supporting documents. With regard to trip to New York assessee has claimed that expenses were incurred to explore tying up with a university for a project on the company's Nagpur land. The Assessing Officer observed that no supporting documents were furnished to prove that such university has been set up till date. Even if the above said expenses were incurred to set up a new business, they can be neither be considered as either preoperative or preliminary which are liable to be deducted as a revenue expense in the Profit and Loss Account. Further, Assessing Officer obse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. With regard to disallowance of advance written off, Ld.CIT(A) has allowed the ground raised by the assessee. 13. Aggrieved with the above order, assessee is in appeal before us raising following grounds in its appeal: -. 1. a) That at the time of the original assessment made u/s. 143(3) the appellant company had disclosed entire facts and reopening done u/s. 147 beyond period of 4 years without there being any failure on the part of the appellant company to disclose fully and truly all material facts is bad in law and the C.I.T.(Appeals) has erred in not cancelling the same. b) That the C.I.T.(A) has totally erred in ignoring the first proviso to Section 147 as it stood then, which clearly provides that where assessment is made under sub-section (3) of Section 143 and period of 4 years from the end of the relevant assessment year has expired, no action u/s. 147 shall be taken, unless any income chargeable to tax has escaped assessment by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. c) That the C.I.T.(A) has erred in not following the following decisions:- 1) IPCA Laboratories Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... travel expenses and advances written off. Even though the Assessing Officer has raised the issue of children education, however, subsequently after considering the submissions of the assessee he has not proceeded to make any addition on the above said issue. 15. Ld. AR submitted that the assessee filed an appeal before the Ld.CIT(A) on the above said two issues, however, Ld.CIT(A) has deleted the issue of advance written off in favour of the assessee and sustained the addition of foreign travel expenses and he submitted that the issue raised before ITAT is not the reasons recorded. In this regard, he brought to our notice Page No. 1 of the Paper Book that the original Assessment Order was passed on 22.11.2011 and he further, brought to our notice Page No. 3 of the Paper Book to submit that assessee has submitted list of advances, breakup of Directors remuneration and details of travel expenses during the original assessment proceedings vide letter dated 21.09.2011. 16. Further, he submitted that the issue under consideration is relating to A.Y.2009-10 and the notice issued u/s. 148 of the Act dated 28.03.2016 which is beyond four years. In this regard, he brought to our notic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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