TaxTMI 
TaxTMI 
TaxTMI 
2013 (9) TMI 78
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....rst two years by placing reliance on the decision of the hon'ble Supreme Court in the case of Asst. CIT v. Rajesh Jhaveri Stock Brokers P. Ltd. [2007] 291 ITR 500 (SC). However, another learned Commissioner of Income-tax (Appeals), who heard the appeal for the assessment year 2002-03, declared the reassessment as invalid and thus allowed the appeal of the assessee for that year. Both the assessee as well as the Department filed appeals before the Tribunal against the orders passed by the respective learned Commissioner of Income-tax (Appeals). Before the Tribunal, the assessee submitted that the Assessing Officer has issued the reassessment notices for these three years under consideration, when the time limit for issuing notice under section 143(2) was still available. Accordingly, it was contended that reassessment notices were bad in law. The co-ordinate Bench of the Tribunal accepted the said plea by placing reliance on the following decisions and accordingly set aside the assessment orders : (a) CIT v. TCP Ltd. [2010] 323 ITR 346 (Mad) ; (b) CIT v. Qatalys Software Technologies Ltd. [2009] 308 ITR 249 (Mad) ; and (c) KLM Royal Dutch Airlines v. Asst. DIT [2007] 292 ITR 49 ....
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.... to the file of the learned Commissioner of Income-tax (Appeals) with the direction to dispose the appeal filed by the assessee afresh. As observed by the hon'ble High Court, the learned Commissioner of Income-tax (Appeals) shall also consider whether the reasons recorded for reopening of the assessment justify the said reopening. The assessee is free to argue the appeal on merits also. The appeal of the Revenue stands disposed of accordingly. We shall take up the appeals filed by the assessee for the assessment years 1999-2000 and 2000-01. The hon'ble High Court of Kerala has directed the Tribunal to consider whether the reasons recorded by the Assessing Officer justify the reopening of the assessments of the two years referred to above. The Revenue has submitted copies of reasons recorded by the Assessing Officer for the two years cited above. For the sake of convenience, we extract below the said reasons : (A) Assessment year 1999-2000 : "For the assessment years 1998-99 and earlier years, the following points were involved in this case : (1) Allowability of exemption under section 10B on CAPs Unit. (2) Computation of deduction under section 80HHC. (3) Treatment of interes....
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....) ; and (7) CIT v. Sambhar Salt Ltd. [2003] 262 ITR 675 (Raj). On the other hand, the learned Departmental representative contended that the reasons recorded by the Assessing Officer are sufficient to come to the conclusion that he had enough reasons to believe that there was escapement of income in both years under consideration. We have heard the rival contentions and carefully perused the reasons recorded by the Assessing Officer. For both assessment years, the Assessing Officer has felt that there was escapement of income, inter alia, in the computation of exemption under section 10B and the deduction under section 80HHC. For both years, the Assessing Officer has taken the view that the provisions of section 14A shall have effect on the interest expenditure claimed by the assessee vis-a-vis the exempted income. It is an admitted fact that the return of income filed by the assessee for both years were only processed under section 143(1) of the Act earlier, i.e., no regular assessments were carried out earlier. It is also a fact that the Assessing Officer did not accept the workings made by the assessee in respect of the claim of exemption made under section 10B and the deduct....
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....d by way of foreign exchange or not, whether the assessee has received the drawback benefits, etc., are not available on record. In the absence of such details, we are unable to examine whether the abovesaid decision of the hon'ble Kerala High Court shall apply to the facts prevailing in the two years under consideration. Accordingly, we are of the view that the factual details require verification at the end of the Assessing Officer. Accordingly, we deem it fit to restore this issue to the file of the Assessing Officer with the direction to examine the said issue afresh in both years in accordance with the decision of the hon'ble jurisdictional Kerala High Court referred supra. The orders of the learned Commissioner of Incometax (Appeals) on this issue are set aside in both years. Ground No. 4 raised in both years relates to the decision of the learned Commissioner of Income-tax (Appeals) in holding that the service charges relating to exports, which are not supported by disclaimer certificates, are to be assessed as other income. The learned authorised representative has pointed out that the Tribunal had earlier disposed of this ground by allowing the claim of the assessee, vide....
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.... Act in respect of service charges, which were treated as "other receipts", the learned Commissioner of Income-tax (Appeals) rejected the ground relating thereto as non-maintainable. Before us, no material was placed by the assessee to contradict the above said findings given by the learned Commissioner of Income-tax (Appeals). With regard to the claim of deduction on the amount of Rs. 3,18,772 treated as income from other sources, the learned Commissioner of Income-tax (Appeals) has observed as under : "The appellant can claim deduction under section 80HHC only in respect of that part of the sales turnover for which disclaimer is received. Once a particular turnover is not considered for deduction under section 80HHC in the absence of disclaimer certificate, the appellant forfeits the claim for deduction under section 80HHC in respect of the profits attributable to that turnover and hence the corresponding service charges can only be treated as charges not eligible for deduction under section 80HHC. They no longer have the character of the amounts referred to in the case of G. Gangadharan Nair [2007] 290 ITR 337 (Ker). Hence the action of the Assessing Officer in excluding the sa....