TaxTMI 
TaxTMI 
2014 (2) TMI 262
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....e intimation dated 23-05-2006 and subsequently the assessment was completed u/s 143(3) vide order dated 13-3-2007. According to assessee all material facts in respect of claim of income and expenditure were fully and truly disclosed during the course of assessment proceedings. The assessment u/s 143(3) was accordingly completed. 2.1. After assessment, assessing officer issued a notice dated 20-4-2009 u/s 154 proposing to disallow an amount of Rs. 51,08,274/- u/s 14A of the Act. Assessee objected to same and filed a detailed reply dated 19-5-2009 which remains to be decided. Without proceeding further in the matter u/s 154 the assessing officer again issued a notice u/s 148 dated 23-3-2011 on the same reasons for which 154 notice was issued. Assessee challenged this notice u/s 148 also and reassessment proceedings vide its reply dated 13-4- 2011. Assessing officer, however, passed the impugned reassessment order dated 1-12-2011 u/s 147/143(3) of the I.T. Act and disallowed an amount of Rs. 51,08,274/- u/s 14A of the Act. 2.2. Aggrieved, assessee preferred first appeal before the CIT(A) challenging the legality of 148 proceedings and merits of disallowance, who observed as unde....
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.... Supreme Court judgment in the case of Phool Chand Bajranglal 203 ITR 456 for the proposition that sufficiency of reasons cannot be examined at the time of issue of notice. 4. Ld. Counsel for the assessee in reply drew our attention to the computation of income in which all the relevant details about computation of the income including capital gains and claim of exemption u/s 10(36) and 10(38) are mentioned. During the course of original assessment proceedings u/s 143(3) vide notice dated 21-2-2007 placed on PB 14, assessing officer specifically asked for all the details of investment made in mutual funds during the period 1-4-2004 to 31-3-2005 along with evidence of source of funds used for investment. Complete information was specifically called for. Vide letter dated 27-2-2007 placed on PB 15, assessee filed relevant reply as under: "3. That investment being the part of main activities of the said company, the surplus fund available were invested in the mutual funds in view of the surge in the capital market. 4. That all these investment were for a very short term period and were initially made out of its own sources and by way of reinvestment on redemption of the same ....
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....he assessing officer, however, rejected the same by following observations: "Notice u/s 148 was issued in this case on 23/03/2011. In response the assessee filed a letter dated 13/04/2011 stating that: "Please refer to your notice dated 23-03-2011 issued u/s 148 of the Act in the case referred to hereinabove. In this connection, it is humbly submitted that the said notice is invalid and barred by limitation of time in view of the first proviso to section 147 of the Income Tax Act, 1961. However, for the sake of compliance, the return of income already filed by the assessee company u/s 139(1) vide your acknowledgement no. 9100000321 dated 24/10/2005 (copy enclosed) be treated as a return filed in compliance to notice u/s 148 of the Act." The objection filed by the assessee has been carefully considered. The objection raised by the assessee is not acceptable as the notice u/s 148 for re-opening the assessment was issued after complying the provisions of Section 151 of the ct and therefore, issuance of notice was valid and within time. Therefore, the objection raised by the assessee is rejected and required to comply with the notices issued. Notice u/s 142)(1) of the Act i....
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....ad in law and on facts in these circumstances. (iii) It is further pleaded that all the relevant details were before the assessing officer and on the basis thereof first action under sec. 154 was proposed to be taken treating the issue to be a mistake apparent from the record. Without deciding the same, notice u/s 148 has been given claiming it to be escapement of income. There is no mention whatsoever in the reasons recorded for reopening that any new material came into the possession of assessing officer after assessment. The conspectus of facts clearly demonstrate that what assessing officer proposed in the garb of reassessment is only change of opinion about the decided issue. Assessing officer cannot review his own decision in the pretext of reassessment. Reliance is placed on the Hon'ble Delhi High Court judgment in the case of CIT Vs. Orient Craft Ltd. 354 ITR 536 (Del.) which has considered the Hon'ble Delhi High Court judgment in the case of CIT Vs. Kelvinator of India Ltd. 256 ITR 1 (Del.), which has been further conformed by the Hon'ble Supreme Court in the case of CIT Vs. Kelvinator of India Ltd.320 ITR 561 (SC) and held as under: "There was no fresh material whic....
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....IT(A) is fully justified and conforms to the mandate of Hon'ble Delhi High Court and the Hon'ble Supreme Court. His order is relied on. 5. We have heard both the parties and perused the material available on record. From the record it clearly emerges that the assessee's original return was processed u/s 143(1). Thereafter, regular scrutiny assessmemt proceedings u/s 143(3) were carried out. From the questionnaire, correspondence undertaken during the course of original assessment proceedings, it emerges that the issue about income from mutual funds, source of investment and related issues were taken into consideration which find a mention in the assessment order also. It is not disputed that no new material facts came in possession of the assessing officer. 5.1. Thereafter assessing officer issued notice u/s 154 framing stand or opinion that it amounts to a mistake apparent from record. Assessee objected to it and proceedings have not been disposed of by AO. 5.2. Without bringing the 154 proceedings to any logical conclusion the assessing officer on the same set of facts and without there being any new information framed another satisfaction that it amounts to escapement o....