TaxTMI 
TaxTMI 
2016 (7) TMI 666
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....se was reopened u/s.147 of the Act by issuing notice u/s.148 of the Act on 08/09/2005 and the reason for reopening was on account of difference in amount of sub-contract income shown by the assessee in its P&L Account and that shown in the TDS certificates, the difference being to the extent of Rs. 3,38,508/-. Thereafter, assessment was framed u/s.143(3) r.w.s. 147 and 144A vide order dated 18/12/2006 and the total income was determined at Rs. 33,97,402/- inter alia by making addition on account of contract income, labour site expenses, site vehicle expenses, machinery rent expenses and unexplained cash credits, the aggregate of such additions being Rs. 3,25,42,360/-. Aggrieved by the order of the Assessing Officer, assessee carried the matter before the ld.CIT(A), who vide order dated 30/05/2007 (in Appeal No.CIT(A)-XI/258/2006-07) deleted the additions made by the AO and thereby allowed the appeal of the assessee. Aggrieved by the order of the ld.CIT(A), Revenue preferred an appeal before the Tribunal. The Tribunal (ITAT "A" Bench Ahmedabad) vide order dated 31st July-2009 in ITA No.3359/Ahd/2007 for AY 2002-03 set aside the orders of the departmental authorities and restored the....
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....ing the assessment, there must be tangible material to reach to the conclusion that there was escapement of income from assessment. The reasons recorded by the A.O., must have a link with formation of belief. As the above facts reveals that there is no tangible material on record to indicate the escapement of income and accordingly the link between satisfaction and initiation of proceedings is missing. Accordingly, in my considered view the proceedings u/s.148 has not been validly initiated. The appellant has rightly placed reliance on the cases of Raymond Woollen Mills Ltd. vs. ITO 236 ITR 34 (S.C.) and CIT vs. Kelvinator of India Ltd., 320 ITR 561 (S.C.) 3.5. It is also a matter of fact that the A.O. has not made addition against the suppressed income of Rs. 3,38,508/- in the impugned assessment order as mentioned in the satisfaction for reopening the assessment. It is a well established proposition of law that the assessing officer can make other additions along with the addition as mentioned in the satisfaction for re-opening the assessment, however, the reverse process cannot be followed i.e. if the addition as mentioned in the satisfaction is not made in the assessment ord....
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.... of contract income u) Copy of TDS return v) Details of unabsorbed losses/depreciation w) Copy of wealth tax return x) Apart from this, the appellant on 21/9/2010 had submitted complete books of accounts along with vouchers, bills, cheque books, slip books, etc. The A.O. has not taken cognizance of these evidences while passing the assessment order. It is also a matter or record that the A.O. had not found any specific defects in the books of accounts inspite of the fact that all the relevant details were submitted during the assessment proceedings. It is an established proposition of law that in the absence of the specific the books of accounts cannot be rejected. Reliance in this regard is placed on the cases of a) Pandit Brothers vs. CIT 26 ITR 159 (Punj) b) Ashoka Refractors Pvt.Ltd. vs. CIT 279 ITR 457 (Cal.) c) Vidhya Traders Vs. CIT 74 ITR 279 (Mys) d) ACIT Vs. L.M.P.Tractors Pvt.Ltd. 148 Taxman, 52 (Ahd.). C) A.O. has not rejected books of accounts at all. It is an established proposition of law that provisions of sec.145 could not be invoked without rejecting the books of accounts. Reliance in this regard is placed on ITO vs. Dr.Kailash Sharma....
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..... 2,91,44,958/-. Thus the learned CIT(Appeals) has erred in giving relief only to extent of Rs. 65,26,337/- against the addition made of Rs. 3,56,71,295/-. It is submitted that the entire addition made by the Assessing Officer ought to have been deleted by the learned CIT(Appeals). It is submitted that the loss as per Return of income of Rs. 2,91,44,958/- be allowed now. 2. The CIT(Appeals) has erred in disposing the ground of charging interest u/s.234A, 234B and 234D and also of non-granting of interest u/s.244A holding and deciding that it is pre-matured. It is submitted that the assessee is not at all liable to pay any interest and therefore, it is submitted that the same be held now. 4. We first take up Revenue's appeal in ITA No.1454/Ahd/2012 for AY 2002-03. 4.1. First ground is with respect to quashing of assessment order. 4.2. Before us, ld.DR supported the order of AO and submitted that despite the directions of the Hon'ble ITAT, no details were furnished by the assessee in the second round of appeal before the AO and in such a situation, AO was justified in making the additions. As far as the additions made on issues other than those on the basis of which the assess....
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....f appeal also, no addition of suppressed receipts has been made by the AO. Thus, there is no addition of suppressed receipts of Rs. 3,38,508/- in the reassessment proceedings, meaning thereby that no addition was made on the ground which was the basis for reaching the conclusion of escapement of income in the reasons recorded for issuance of notice u/s.148 of the Act. We find that the Hon'ble Bombay High Court in the case of CIT vs Jet Airways (I) Ltd. reported at (2011) 331 ITR 236 (Bom.) on the issue as to whether addition on other grounds could be made when no addition has been made of the income, which was initially the basis of reopening has decided the issue in favour of assessee. The Head Note of the decision is reproduced hereunder:- "Reassessment-Scope-Items unconnected with escapement for which notice was issued-When Expln. 3 to s. 147 was introduced, Parliament stepped in to correct what it regarded as an interpretational error in the view which was taken by certain Courts that the AO has to restrict the assessment or reassessment proceedings only to the issues in respect of which reasons were recorded for reopening the assessment-However, Expln. 3 does not and cannot ....