AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2015 (9) TMI 748
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....e's case is fully covered under Section 147 of the Act, since as per the provision of Section 147 of the Act, only condition required to be fulfilled for reopening within four years from the end of the relevant assessment year is that the A.O must have reason to believe that any income chargeable to tax escaped assessment?" 2.0. The facts leading to the present appeal in nutshell are as under: 2.1. That the assessee is a company in the business of manufacturing of fertilizers and chemicals. That the assessee filed return of income for AY 2008-09. That the case was taken under scrutiny. The AO issued the notice under Section 143(3) of the Income Tax Act (hereinafter referred to as the "Act") and asked the assessee to produce / furnish the desired details as mentioned in the notice dated 13.01.2010. That the assessee replied to the same and furnished the necessary details as asked vide reply / communication dated 28.3.2010. That thereafter, the assessment under Section 143 (3) of the Act was completed on 30.3.2010 determining the income at Rs. 446,00,97,836/- and booked profit under Section 115JB of the Act was determined as Rs. 523,28,07,230/-. That subsequently, AO reopened t....
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....eal before the learned Tribunal being ITA No.631/AHD/2013 challenging the order passed by the learned CIT(A) in so far as allowing deduction of Rs. 1,44,63,411/- on account of unutilized CENVAT Credit at the end of year. The assessee also preferred appeal before the learned Tribunal being ITA No.480/AHD/2013 in so far as order passed by the learned CIT(A) upholding the reassessment / order passed by the AO under Section 147 of the Act. It appears that the assessee also filed Cross Objection No.127/AHD/2013. That by impugned judgment and order, the learned Tribunal has allowed the appeal and cross objection preferred by the assessee and has held the reassessment invalid. Consequently, the appeal preferred by the revenue and cross objection filed by the assessee are dismissed. 2.4. Feeling aggrieved and dissatisfied with the common judgment and order passed by the Tribunal in holding the reassessment invalid, the revenue has preferred present Tax Appeal to consider the aforesaid proposed substantial question of law. 3.0. Shri K.M. Parikh, learned advocate for the revenue has vehemently submitted that the learned Tribunal has materially erred in holding reassessment for AY 2008-09 i....
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....eopened by AO on the ground that the finished goods of the assessee were shown inclusive of Excise Duty but the raw materials were exclusive of the CENVAT as derived from statement No.8 to clause 22(a) of form No.3CD, wherein it was mentioned that MODVAT utilized is not shown in P & L Account and on the ground that at the end of the previous year, the unutilized CENVAT credit with the assessee was Rs. 1,44,63,411/- only and therefore, increased in the unutilized CENVAT credit was required to be included in the valuation of closing stock of raw materials. It is submitted that both the aforesaid issues were as such dealt with and considered by the AO during the original scrutiny assessment. It is submitted that in the notice under Section 142(1) dated 31.1.2010 the assessee was specifically asked to state as to whether the closing stock of finished goods has been shown after excise duty component and if not, please given the amount of excise component and explanation as to why the same should not be added. It is submitted that in the notice under Section 143(1) of the Act dated 31.1.2010, the assessee was called upon to justify as to why the prior period expenses should not be disall....
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.... submitting the return of income the assessee claimed the deduction at Rs. 99,44,276/- as prior period expenses and also shown the closing stock of finished goods after including excise duty component. It is required to be noted that the assessee was following mercantile system of accountancy. A case was selected for scrutiny and the assessee was served with the notice under Section 142(1) of the Act vide notice dated 30.1.2010 and the assessee was requested to produce / furnish the desired details. The assessee was also called upon to state as to whether the closing stock of finished goods has been shown after including excise duty component and if not, to give the amount of excise component and explanation as to why the same should not be added. That the assessee was also called upon to justify as to why the prior period expenses should not be disallowed and add to total income. From the reply / communication dated 28.1.2010 the assessee furnished the necessary explanation / particulars and with respect to aforesaid queries the assessee state as under: "15(22). We have shown closing stock of finished goods after including excise duty component. The details regarding Valuation o....
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....e relevant assessment year. In such circumstances, the proviso the Section 147 of the Act is clearly not applicable. Therefore, it is not necessary for the Revenue to prima facie establish that there has been a failure on the part of the Assessee to disclose fully and truly all materials facts necessary for assessment while issuing a notice for reopening a completed assessment. However, it is a settled law that even in case of reopening of assessment within a period of four years from the end of relevant assessment years, the AO has to have reason to believe that income chargeable to tax has escaped assessment on the basis of tangible material. When all materials facts necessary for determination of the income has been disclosed by the Assessee and the AO has taken a particular view on those view on those disclosed facts while passing the assessment order in regular proceedings, then without anything more, it would not be open to reopen those assessment proceedings for it would be a case of change of opinion. In the present case, the reasons for reopening indicate that the reopening has been initiated on account of 2 grounds namely the non inclusion of CENVAT duty while valuing the....