2016 (11) TMI 726

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....nd circumstances of the case, the Tribunal was right in holding that the reassessment proceedings in the case of the assessee is not valid under law in light of the fact that there has been no full and true disclosure of material necessary for assessment during the original assessment proceedings? (2) Whether on the facts and circumstances of the case, the Tribunal is right in holding that the Assessing Officer had verified the claim of deduction at the stage of proceedings u/s.143(1) (a) and also in the related proceedings u/s.154, when in fact the Assessing Officer had only considered the allowability of the deduction in toto under the above proceedings and not the eligibility of the assessee to claim the deductions, since there was no o....

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....tate that when the original assessment order showed that the cash credits in question were not duly considered, proceedings under Section 147 of the 1961 Act would be applicable, going by the ratio of that decision rendered in terms of the corresponding provisions of the 1922 Act. 5.The dispute between the Department and the assessee, is as to whether the assessing authority was entitled to invoke Section 147 of the Act as regards the deductions granted by the assessing authority at the first instance through the assessment order allowing deductions under Sections 80HH and 80I during the regular assessment proceedings against the assessee. The argument advanced by the learned counsel for the Department on the basis of the pleadings of the ....

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....e vide letter dated 10th July 1993 stated that Section 80-I does not insist on keeping separate accounts for the new industrial undertaking. The profit arising out of the operations of the new plants can be reasonably estimated as a proportion to the production since the items produced at all the plants are same. Hence, the basis on which the deduction is allowed under section 80HH can be applied for this section also. Therefore since deduction was allowed under section 80HH, the deduction claimed under section 80-I must also be allowed on the same basis. Then in assessee's paper book pg.No.9, the Deputy Commissioner of Income Tax (Asst.), Special Range vide letter dated 10.08.1993 invited the assessee's attention to section 80I(6).....

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....pg.No.16 mentions about the schedule of sundry creditors." 8.On the basis of the aforesaid materials, the Appellate Tribunal was satisfied that the assessing officer, in the first round, while making the original assessment order, had actually considered the materials, after requiring the relevant materials to be produced. The assessee-Company had produced those materials and the Tribunal also dilated on the question as to whether the claims were debatable or not. With the aforesaid in mind, we revert to the first proviso to Section 147 of the Act. It has to be pointedly noted here that action under the first proviso to Section 147, that is to say, for a period after the expiry of four years, can be generated only if the income chargeable....