Tribunal invalidates reassessment for 2004-05, confirms tax for 2006-07, remits 2007-08, dismisses 2008-09 disallowances, upholds 2010-11 assessment.

The Tribunal held that the initiation of reassessment proceedings for A.Y. 2004-05 was invalid due to non-existent reasons and a time-barred notice. The addition of amounts for A.Y. 2006-07 was confirmed as chargeable to tax. For A.Y. 2007-08, the matter was remitted for further consideration. Disallowances for A.Y. 2008-09 were dismissed as infructuous. In A.Y. 2010-11, the lower income offered in response to a notice was ignored, upholding the original assessment. Appeals for A.Y. 2004-05 and 2007-08 were allowed, while those for A.Y. 2006-07 and 2010-11 were dismissed, with the A.Y. 2008-09 appeal deemed infructuous.

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Issues Involved:
1. Initiation of re-assessment proceedings for A.Y. 2004-05.
2. Addition of Rs. 4,74,230/- for A.Y. 2006-07.
3. Addition of Rs. 1,97,08,972/- on account of provision of overdue interest for A.Y. 2007-08.
4. Confirmation of addition of Rs. 1,71,616/- and Rs. 12,03,619/- for A.Y. 2008-09.
5. Ignoring the return filed under section 147 and not adopting the income as per the return filed under section 147 for A.Y. 2010-11.

Detailed Analysis:

1. Initiation of Re-assessment Proceedings for A.Y. 2004-05:
The original assessment was completed under section 143(3) of the Income Tax Act, 1961, accepting the loss returned by the assessee at Rs. 10.53 crore. A notice under section 148 was issued on 28-03-2011 for reasons including wrong provision for overdue interest, wrong provision on account of NPA, and loss on Government Securities claimed in the profit and loss account. The assessee objected to the initiation of re-assessment proceedings, but the objections were dismissed by the AO. The Tribunal found that the original assessment was completed under section 143(3) and the reasons for re-assessment were non-existent as the AO did not make any addition for two of the three reasons and the addition made was deleted in the first appeal. The Tribunal held that the initiation of reassessment was bad in law and set aside the proceedings. Additionally, the notice under section 148 was issued beyond the stipulated period of four years from the end of the relevant assessment year without any failure on the part of the assessee to disclose fully and truly all material facts. Thus, the initiation of re-assessment proceedings was invalid.

2. Addition of Rs. 4,74,230/- for A.Y. 2006-07:
The assessee credited Entry fees and Nominal membership fees to the Reserve Funds without routing them through the Profit and Loss account. The AO treated these amounts as chargeable to tax, and the CIT(A) confirmed the addition. In the absence of any material supporting the assessee's claim, the Tribunal upheld the impugned order, confirming the addition.

3. Addition of Rs. 1,97,08,972/- on Account of Provision of Overdue Interest for A.Y. 2007-08:
The assessee made a provision for overdue interest at Rs. 1.97 crore, which was disallowed by the AO. The Tribunal noted that there was no elaborate discussion on the merits of such ground in the impugned order. Therefore, the matter was remitted to the file of the CIT(A) for passing a speaking order on this issue.

4. Confirmation of Addition of Rs. 1,71,616/- and Rs. 12,03,619/- for A.Y. 2008-09:
The AO made a disallowance of Rs. 1,71,616/- on the ground that the amount was paid after the due date of filing the return of income. The CIT(A) deleted the addition, and the Tribunal dismissed the ground as infructuous. The AO also disallowed Rs. 12,03,619/- out of the claimed deduction of Rs. 48,50,619/- for interest rebate on loans of the bank, as only Rs. 36.47 lakhs was actually given. The CIT(A) deleted the disallowance, and the Tribunal dismissed the ground as infructuous.

5. Ignoring the Return Filed Under Section 147 and Not Adopting the Income as Per the Return Filed Under Section 147 for A.Y. 2010-11:
The assessee filed a return declaring total income of Rs. 6,59,94,758/-, which was accepted under section 143(1) and a refund was granted. Later, the AO observed that the assessee claimed excessive deduction under section 36(1)(viia) and issued a notice under section 148. The assessee filed a return declaring total income of Rs. 5,55,78,080/- in response to the notice. The AO completed the assessment at the originally returned income of Rs. 6.59 crore, ignoring the lower income offered in response to the notice under section 148. The CIT(A) confirmed the decision of the AO. The Tribunal upheld the impugned order, stating that re-assessment is carried out for the benefit of the Revenue and not the assessee, and fresh independent claims reducing the income already declared cannot be raised in re-assessment proceedings.

Conclusion:
The appeals for A.Y. 2004-05 and 2007-08 were allowed in favor of the assessee, while the appeals for A.Y. 2006-07 and 2010-11 were dismissed. The appeal for A.Y. 2008-09 was dismissed as infructuous.

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