TaxTMI 
TaxTMI 
TaxTMI 
2012 (7) TMI 593
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....me at Rs.32.22 crores (rounded off). In the return of income, the assessee had claimed certain deductions under sections 35(1)(i), (ii) and (iv) of the Act. The Assessing Officer had, on 18.8.2004, raised certain queries, one of them pertained to laboratory and research expenses and called upon the assessee to furnish documents to substantiate the claim of deduction under sections 35(1)(i), (ii) and (iv) of the Act. The petitioner in response to such query, produced certain documents. In the final assessment order that the Assessing Officer passed, he made no disallowances towards such claim of laboratory and research expenses. He, of course, had not discussed this issue, nor given any reasons for making no disallowances. Be that as it may, the issue rested at the level of the Assessing Officer. 3. More than four years after the end of the relevant assessment year, the Assessing Officer issued the impugned notice calling upon the petitioner to furnish a return of income stating that he had reason to believe that the income chargeable to tax for the assessment year 2002-03 had escaped assessment. 4. The petitioner was furnished reasons recorded by the Assessing Officer to issue su....
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....riod of four years since there was no failure on the part of the assessee to disclose fully and truly all material facts. 6. The petitioner further contended that the question of deduction for scientific and research expenditure not carried out in-house, the issue has been decided in favour of the assessee by the Bombay High Court in case of National Rayon Corporation Ltd., reported in 140 ITR 143. 7. With respect to payments made to Delhi University and Nagpur University, the petitioner contended that such universities were duly approved under the Income Tax Act of 1922 and by virtue of section 297(2)(k) of the Act, such notification issued in the Income Tax Act of 1922 would be valid under the Income Tax Act, 1961 also. 8. The petitioner contended that in any case, both the issues were examined by the Assessing Officer while framing the original assessment and any addition now on the same ground would be a mere change of opinion. 9. The Assessing Officer disposed of such objections vide his order dated 03.09.2009. He held that the assessee's reliance on the note regarding the claims made in the original return, audit report of the tax auditor and the details of documents file....
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....r Daily, Delhi, the petitioner never brought true and correct facts on record in the return filed, as also during the assessment proceedings. He pointed out that some of the claims under section 35(1) of the Act were withdrawn by the assessee in the subsequent assessment years. 11.1 Counsel submitted that the Assessing Officer after recording reasons, had issued the notice for reopening. Sufficiency of such reasons cannot be gone into by the Court at this stage. In short, he contended that the fresh assessment pursuant to such notice must be allowed to be completed. 12. Having thus heard the learned counsel for the parties and having perused the documents on record, it clearly emerges that in the present case, notice for reopening of the assessment previously framed under section 143(3) of the Act is sought to be reopened beyond a period of four years from the end of the relevant assessment year. In that view of the matter, in addition to the Assessing Officer having reason to believe that the income chargeable to tax has escaped assessment, the additional requirement that such escapement of income was for reason of the assessee's failure to disclose fully and truly all material ....
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....(ii), (iv)." 14.3 In reply to such query, the petitioner produced various documents. Such documents are placed before us along with a statement of Aparna Parlekar on behalf of the petitioner. Along with such statement, documents and accounts which were produced before the Assessing Officer in response to such query have been placed on record. 14.4 It was after such scrutiny that the Assessing Officer framed his assessment on 17.3.2005 making several additions and disallowances, and assessing total income of the assessee at Rs.34.22 crores against the declared income of Rs.7.87 crores. It can, thus, be seen that whenever the Assessing Officer had reason to believe that a claim of deduction or disallowance was not to be granted, he made necessary adjustments. Significantly however, with respect to the petitioner's claim for deduction for scientific research under section 35(1) of the Act, he made no disallowance. In other words, without any discussion, he did not disturb the petitioner's claim of deduction under such provision. 15. It can, thus, be seen that the claim of deduction was at large before the Assessing Officer. He applied his mind. Called upon the petitioner to supply ....