TaxTMI 
TaxTMI 
2014 (5) TMI 440
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....me from long term capital gains arising during the year under consideration. Such return was taken in scrutiny by the Assessing Officer. He framed assessment on 29th December 2010 assessing the total income of the petitioner at Rs. 13.52 Crores [rounded off]. He, however, made no disallowances on the setoff claimed by the assessee of the brought forward unabsorbed depreciation allowances of Rs. 4.26 Crores. It is this scrutiny assessment which the respondent desire to reopen and for which impugned notice came to be issued. The notice thus was issued within a period of four years from the end of the relevant assessment year. At the request of the petitioner, respondent supplied reasons recorded by him for issuing such a notice. The reasons read as under : "With reference to your requirement of reasons for reopening, it is stated that you had filed your return of income for A.Y 2008-09 on 31.03.2010 declaring total income of Rs. 177.43 lacs. Further, assessment order u/s. 143 (3) of the Act was finalized in your case on 29.12.2010 determining total income at Rs. 1352.69 lacs. As per record, it is revealed that brought forward depreciation of Rs. 77.10 lacs pertaining to earl....
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....the assessee could take recourse to remedies under the law. In the present case, though the objections were disposed of shortly before the final order of assessment, the same was served only after framing the assessment. In facts of the case, however, the learned counsel stated that he would not like to go back to the Assessing Officer on this ground and pressed his challenge for reopening itself in this petition. [ii] that the Assessing Officer had issued notice for reopening at the instance of the audit party. To the audit objection so raised with respect to this very item, the petitioner had made a representation pointing out why such objection was not valid. Thereafter, the Assessing Officer issued the notice recording reasons same as those mentioned by the audit party. [iii] In any case, the reasons recorded lack validity. Our attention was drawn to a decision of this Court in case of General Motors India Private Limited v. Deputy Commissioner of Income Tax, reported in [2013] 354 ITR 244 (Guj) to contend that on the very same grounds, where in case of another assessee, assessment was sought to be reopened, this Court quashed the reopening holding that the very ground was n....
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....irst to lodge preliminary objection before the Assessing Officer who is bound to decide the preliminary objections to issuance of the reassessment notice by passing a speaking order and therefore, if such order on the preliminary objections is still against the assessee, the assessee will get an opportunity to challenge the same by filing a writ petition so that he does not have to wait till completion of the reassessment proceedings which would have entitled the liability to pay tax and interest on reassessment and also to go through the gamut of appeal, the second appeal before Incometax Appellate Tribunal and then reference/tax appeal to the High Court. Viewed in this light, it appears to me that the rigour of availing of the alternative remedy before the Assessing Officer for objecting to th reassessment notice under section 148 has been considerably softened by the apex court in GKN case [2003] 259 ITR 19 in the year 2003. In my view, therefore, the GKN case [2003] 259 ITR 19 (SC) does not run counter to the Calcutta Discount Co. Ltd. case [1961] 41 ITR 191 (SC) but it merely provides for challenge to the reassessment notice in two stages, that is- (i) raising preliminar....
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....r had issued notice for reopening, this Court quashed the same inter alia on the ground that the reason itself was not valid. The Court held that the unabsorbed depreciation could be allowed to be carried forward and set off for a period beyond eight years also, without any reference to the time limit. It was held and observed as under : "37. The CBDT Circular clarifies the intent of the amendment that it is for enabling the industry to conserve sufficient funds to replace plant and machinery and accordingly the amendment dispenses with the restriction of 8 years for carry forward and set off of unabsorbed depreciation. The amendment is applicable from assessment year 2002-03 and subsequent years. This means that any unabsorbed depreciation available to an assessee on 1st day of April, 2002 (A.Y. 2002-03) will be dealt with in accordance with the provisions of section 32(2) as amended by Finance Act, 2001 and not by the provisions of section 32(2) as it stood before the said amendment. Had the intention of the Legislature been to allow the unabsorbed depreciation allowance worked out in A.Y. 1997-98 only for eight subsequent assessment years even after the amendment of section 3....