TaxTMI 
TaxTMI 
2018 (1) TMI 328
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....l before or during the course of the hearing of the appeal. 2. Briefly stated facts of the case are that the assessee filed regular return of income on 30/11/2007 declaring total income of Rs. 12,14,30,611/-. Consequent to the search and seizure action under section 132 of the Income-tax Act, 1961 (in short 'the Act'), assessment under section 153A/143(3) of the Act was completed on 26/12/2009 assessing total income at Rs. 14,16,64,407/-. In the assessment order, the Assessing Officer made one of the disallowance amounting to Rs. 97,15,872/-for bogus sub-arranger fee against following parties: M/s. Shevin Capital Private Limited Rs.22,78,472 M/s. Rishi Automation Rs. 8,41,800 M/s. Singhal Galvanizing Industries Rs.31,42,700 M/s. Vishal Metal Castings Private Ltd. Rs.28,06,000 M/s. Ashika Capital Rs. 84,100 M/s. Karni Projects Private Limited Rs. 2,81,400 M/s. Raj Nikita Builders Private Ltd. Rs. 2,81,400 Total Rs.97,15,872 3. On further appeal by the assessee, the Commissioner of Income Tax (appeals)-I, New Delhi, allowed the appeal of the assessee and deleted the additions including the addition for bogus sub arranger....
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....he basis of the reconciliation of amount of sub-arranger fee paid recorded in the books of accounts of the assessee and sub-arranger fee received recorded in the books of accounts of M/s Maruti Papers Ltd. The assessee further submitted that in the year under consideration, also the assessment has been reopened on identical grounds. The learned CIT-(A) following his finding for the assessment year 2006-07, held the reassessment under section 147 of the Act as invalid. The relevant finding of the learned CIT-(A) on the validity of the reassessment is reproduced as under: ".................................................................................... Since in the year under consideration also the same facts are there are same submissions have been made as were made during the appellate proceedings for assessment year 2006-07 therefore, relying on my order dated 11.06.2014 for assessment year 2006-07, I hold that in the year under consideration also the reasons recorded are bad in law and based on "change of opinion" and there is nothing on record to suggest that reopening under section 147 of the Act is valid. In the absence of all these, in my humble view the reopenin....
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..... He referred to the reasons recorded for the year under consideration, available on page 186 to 187 of the paper book and submitted that reasons recorded in the year under consideration are identical to the reasons recorded for the assessment year 2006-07. Accordingly, he submitted that appeal of the Revenue might be dismissed. 7. We have heard the rival submission and perused the relevant material on record. The Revenue in its grounds has challenged that the assessment was reopened on the basis of independent information in the form of enquiry report of Investigation Wing suggesting the payment to M/s. Maruti Papers Ltd. was bogus. We have perused the copy of reasons recorded by the Assessing Officer, available in the paper book filed by the assessee at page 186 to 187. For the purpose of clarity, the said reasons recorded by the Assessing Officer are reproduced as under: "In this case assessment u/s 153A/143(3) of I.T. Act, 1961 was completed on 26.12.2009 at an total income of Rs. 14,16,64,407/- as against returned income of Rs. 12,14,30,611/- filed on 13.11.2007. The assessee company M/s. A.K. Capital Serviced Ltd. has debited a sum of Rs. 7,21,42,282/- on....
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....l of the assessee explained before us that this difference was due to change in accounting of service tax. According to him, the assessee followed inclusive method in respect of the service tax, whereas M/s. Maruti Paper Ltd followed exclusive method of service tax and therefore, said party has not shown amount of service tax in the profit & loss account. The Ld. counsel drawn our attention to page 52 to 68 of the paper book and submitted that all information in respect of sub-arranger fee, including the fee paid to M/s Maruti Papers Ltd. was already submitted before the Assessing Officer in proceedings under section 153A/143(3) of the Act and no adverse inference was drawn in respect of M/s Maruti Papers Ltd. The Ld. CIT(DR) could not controvert this fact that said information was already available with the Assessing Officer. In our opinion, when the information was already available before the Assessing Officer in respect of arranger fee paid to M/s Maruti Papers Ltd., reopening the assessment on the basis of the same information certainly amount to change of opinion. We may like to emphasize here that in the reasons recorded there is no mention of any additional information rece....
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....,15,740 7. 04.03.2006 80,000 8,160 88,160 Total 1,14,65,500 11,69,481 1,26,34,981 7. Thus, a perusal of the reasons recorded by the AO shows that the difference of Rs. 11,69,481/- has been paid in excess which has escaped assessment whereas the difference is nothing but service tax charged by M/s Maruti Paper Ltd. Even though these details were available before the AO, we find the AO without applying his mind properly has reopened the assessment by recording reasons. We therefore, find no infirmity in the order of the CIT(A) in holding that the assessee had disclosed all the facts in the original assessment and AO cannot reopen the assessment in absence of any change in the material facts. 7.1 So far as grounds raised by the revenue are concerned, it has been mentioned that the reopening was made on the basis of independent information in the form of enquiry report of investigation wing suggesting that payment to M/s Maruti Paper Ltd., was bogus. However, reasons recorded shows that there was escapement of income to the-tune of Rs. 11,69,481/-. As mentioned earlier, the above amount is nothing but th....