2010 (10) TMI 1124

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....rofit on sale of Govt. Securities amounting to Rs. 3,76,70,000/- is allowable u/s 80-P(2)(a)(i) of the Income-tax Act, 1961 to the assessee." 2. The assessee invoked Rule 27 of the Income Tax Appellate Tribunal Rule, 1963 and raised the following grounds : 1. The ld. CIT(A) failed to appreciate that the assessment has been reopened on mere change of opinion and there was full and complete disclosure of facts in the course of original assessment which was completed u/s 143(3) and therefore the notice u/s 148 dt. 30/3/2007 is bad in law. 2. The ld. CIT(A) failed to appreciate the fact that the Assessing Officer has applied his mind on the issue of profit of Rs. 3,76,70,000/- on sale of Government securities in the course of Assessmen....

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.... cooperative bank and is registered under the Banking Regulation Act. It is having a banking licence from Reserve Bank of India. It carries on the business of banking. The assessee is also registered under the Maharashtra Cooperative Societies Act, 1960. It filed its return of income on 25-11-2003, declaring Nil income. The AO after due enquiry, passed an order u/s 143(3) on 19-12-2005 determining the taxable income at Nil. Thereafter a notice u/s 148 was issued on 30-3-2007. The same was received by the assessee on 10-4- 2007. In response, the assessee filed a revised return on 26-4-2007 declaring Nil income. The AO issued notice u/s 142(1). Thereafter he asked the assessee, the reasons as to why deduction u/s 80P should not be allowed on ....

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....issue of reopening, we find that in the original assessment order was passed u/s 143(3) on 19-12-2005, though the assessment order is brief and cryptic, the assessment record shows that the AO has sought clarifications from the assessee on this issue. In the questioner issued on 3rd June, 2005 at para 7 the AO questioned as follows : " Please explain Profit on Sale of Govt. Securities giving details like opening stock, purchase, sale and closing stock. Please explain how the same can be classified as banking activity as per the Banking Regulation Act. " In a letter dated 28-11-2005 at para 7, the AO asked as follows : " Substantiate your claim for deduction U/s 80P for the following items : a) Interest & Discount 1,26,10,607.92/....