TMI Blog2023 (12) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... s, there is no case made out for reopening the Assessment that was completed earlier. Reopening of the Assessment was inspired from a review and a change of opinion by the subsequent officer. Such practice has been deprecated and frowned upon by the Courts. Although the petitioner has resorted to window dressing of the statement of actual of statements filed along with the Statement of Profit and Loss for the year ended 31st March 2014, it cannot be said that the petitioner has not disclosed material. There is a complete disclosure by the petitioner along with the regular returns filed under Section 139 of the Income Tax Act, 1961 on 28.11.2014. The petitioner has also uploaded the hard copy of the same in response to a notice issued under Section 143(2) of the Income Tax Act, 1961 on 28.08.2015. The reasons given for re-opening of the Assessment along with a notice issued u/s 143(2) r.w.s.147 of the Income Tax Act, 1961 on 05.05.2021 is also based on the Profit and Loss Account. Thus, there is no scope for re-opening of the assessment which was completed on 28.09.2018 under Section 143(3) read with section 92CA(3) and Section 144C(8) of the Act. Clearly, the reasons given fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;BNYM Group'). The petitioner provides services to the group companies. 9. The petitioner had filed a regular returns under Section 139 of the Act for the assessment year 2014-2015 on 28.11.2014. The return filed by the petitioner under Section 139 of the Act was scrutinized. The return was assessed and ultimately an assessment order came to be passed on 28.09.2018 under Section 143(3) read with section 92CA(3) and Section 144C(8) of the Act. The said assessment order dated 28.09.2018 came to be passed after the petitioner was called upon to explain the details. 10. The specific case of the petitioner is that invocation of Section 148 of the Act on 25.03.2021 which is subject matter of challenge in WP.No.6635 of 2022 was without jurisdiction as the petitioner had filed all the documents that were required for assessment before the assessment order came to be passed on 28.09.2018 and therefore invocation of Section 148 for the purpose of re-assessment to Section 147 of the Act as it stood prior to its amendment with effect from 01.04.2021 during the period in dispute was not available to the Income Tax Department. 11. The case of the petitioner is that the petitioner ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in dispute prior to the amendment of the Income Tax Act, 1961 was clearly without jurisdiction. In this connection, a reference is made to the decision of the Hon'ble Surpeme Court in Calcutta Discount Co. Ltd., Vs. Income-tax Officer , [1961] 41 ITR 191 (SC). 17. It is submitted that even otherwise the impugned notice issued under Section 148 of the Act was inspired from change of opinion by the incumbent who issued the impugned notice dated 25.03.2021 under Section 148 of the Act and therefore contrary to the law settled by the Division Bench of Delhi High Court in Kelvinator of India Ltd., Vs. Commissioner of Income-tax, Delhi , which was affirmed by the Hon'ble Supreme Court in Commissioner of Income-tax, Delhi Vs. Kelvinator of India Ltd. , [2010] 320 ITR 561. 18. In this connection, the decision of all the Courts including thereof this High Court, in the following cases were relied on:- (i) Commissioner of Income-tax Vs. Foramer France , [2003] 264 ITR 566 (SC); (ii) Commissioner of Income-tax Vs. Corporation Bank Ltd. , [2002] 254 ITR 791 (SC); (iii ) Asianet Star Communications (P.) Ltd., Vs. Assistant Commissioner of Income-tax Non- Corporate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an item of expenditure allowable under Section 37(1) in the year of accrual. 23. Defending the stand of the respondent, the learned Senior Standing Counsel for the respondents would submit that the petitioner has not made a true and full disclosure of all the material that is required for completing thee assessment and therefore, the Department was justified in re-opening the assessable vide impugned notice dated 25.03.2021 and consequently the order dated 01.03.2022 was passed over ruling the objection of the petitioner. 24. It is submitted that the challenge to the impugned notice dated 25.03.2021 issued under Section 148 of the Income Tax Act, 1961 and impugned order dated 01.03.2022 is without any merits. 25. It is submitted that none of the documents were filed by the petitioner indicating that the petitioner had given a break-up of the amount that was claimed as loss incurred by the petitioner from the foreign exchange transactions and what as declared by the Income Tax authority at the time of filing of the return together with the profit and loss account and the balance sheet only to show the net income from the foreign exchange was for a sum of Rs. 3,80,17,01/- a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction of Rs. 1,43,82,361/- as loss incurred from the foreign exchange from the total foreign exchange earned for a sum of Rs. 5,23,99,372/-, it is evident the petitioner has given all the details to the Assessing Officer for passing of Assessment Order. 30. A perusal of the profit and loss account of the petitioner though does not reveal that the petitioner has given a calculation to the Assessing Officer, what has been given in Note 20 21 to the Statement of Profit and Loss for the year ended on 31.03.2014 gives the net gain on account of the foreign exchange fluctuation. There is no quantification or qualification that the total amount of foreign exchange earned was Rs. 5,23,99,372/- and a sum of Rs. 1,43,82,361/- was reduced to arrive at Rs. 3,80,17,011/-. Note 21 reads as under: 21 Other income Year ended Year ended March 31,2014 March 31, 2013 Dividend income from current investments 313,867,651 272,266,934 Servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pensation expenses 2,535,223 864,326 Unrealised foreign exchanges loss, net 14,382,361 1,457,999 Interest income on deposits (1,268,326) (7,890) Dividend income received (313,867,651) (272,266,934) Operating profit before working capital changes 1,003,137,613 768,408,737 33. Thus, there is disclosure in the Statement, Profit and Loss Account for the year ended 31.03.2014. The report of the Independent Auditor under Section 227(3) of the Companies Act, 1956, states that the petitioner company does not have any accumulated losses at the end of the financial year and also has not incurred any cash losses in the financial year and in the immediately preceding financial year. 34. Thus, it is evident that there is a disclosure in the Audited balance sheet that was filed after it was called for under a notice issued under Section 143(2) of the Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ening the Assessment that was completed earlier. Reopening of the Assessment was inspired from a review and a change of opinion by the subsequent officer. Such practice has been deprecated and frowned upon by the Courts. 36. Although the petitioner has resorted to window dressing of the statement of actual of statements filed along with the Statement of Profit and Loss for the year ended 31st March 2014, it cannot be said that the petitioner has not disclosed material. There is a complete disclosure by the petitioner along with the regular returns filed under Section 139 of the Income Tax Act, 1961 on 28.11.2014. The petitioner has also uploaded the hard copy of the same in response to a notice issued under Section 143(2) of the Income Tax Act, 1961 on 28.08.2015. 37. The decision of the Hon'ble Supreme Court in Calcutta Discount Co. Ltd., Vs. Income-tax Officer , [1961] 41 ITR 191 (SC) has been followed by the Courts all over the country. The relevant portion from the said decision reads as under:- It is not for somebody else-far less the assessee--to tell the assessing authority what inferences-whether of facts or law should be drawn. Indeed, when it is remembered ..... X X X X Extracts X X X X X X X X Extracts X X X X
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