2016 (10) TMI 630

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....various questions of law, Mr. Tejveer Singh, learned Counsel for the Appellant Revenue, urges only the following question of law for our consideration: "(I.) Whether on the facts and circumstances of the case and in law, the Tribunal has erred in holding that notice issued u/s.148 is bad in law and be set aside?" 4. The Respondent Assessee is a Project Contractor. It was awarded a contract by Kondapalli Power Corporation Ltd.(KPCL), Andhra Pradesh to set up a power plant on a turnkey basis. Further, KPCL had awarded an onshore contract to the RespondentAssessee for supply of goods and services along with the commissioning of the plant. KPCL also awarded an offshore supply contract to Hanjung DCM Co. Ltd. (Hanjung) for supply of ....

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...., Korea. This contract was of USD 103 millions. Although this contract is apparently with different person it is seen that a recovery suit of insurance for loss of equipment was filed on behalf of the assessee. The assessee has not disclosed the portion of the revenue amounting to USD 103 million received on account of the same from India in its return of income for this assessment year. 2.1 Thus I have reason to believe that income of USD 51.5 million chargeable to tax has escaped assessment for A.Y.2000-01. 3 Issue notice u/s. 148 of the Income Tax Act, 1961." 6. The RespondentAssessee during the Assessment proceedings consequent to reopening notice dated 26 March 2004 submitted that the same is without juris....

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....principal. Based on this policy coupled with the plaint as filed, the CIT(A) observed that the plaint has to be read as a whole. So read, the nature of the relationship between the parties is described in paragraph 4 thereof, which, as extracted in the order, reads as under : " 4. A brief reference to the parties involved in relation to the subject matter of this suit is as follows : a. Lanco Kondapalli Power Pvt. Limited (formerly a public limited company) ('LKPL') is the owner of the Kondapalli Power Project. b. Plaintiff is the EPC contractor for the Kondapalli Power Project, and an assured under the policy issued by Defendant. i. Encon Services Limited ('Encon') is the subcontractor of....

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....there was reason to believe that the income chargeable has escaped assessment. He, therefore, concluded that there was no reason to form a belief that income chargeable to tax has escaped assessment. On appeal by the Revenue, the Tribunal, by the impugned order, confirmed the finding of the CIT(A). 8. We find that the two authorities have concurrently reached a finding of fact that the Respondent Assessee was not the supplier of the equipment and it had taken out insurance claim only in its capacity as contractor and in terms of the contract entered into between the parties. This conclusion was recorded by the CIT(A) as well as the Tribunal upon consideration of the contract entered into between the parties and particularly with regard t....