TaxTMI 
TaxTMI 
2020 (3) TMI 678
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....bsequently, based on the information received from the JCIT (OSD) - (1), Mumbai, the case was reopened with the following reasons:- "Mr. Ashok Advani holds more than 10% of the shares in M/s Business India Publications Ltd., who is assessed in the charge of JCIT (OSD) - 2(1), Mumbai. Moreover, M/s Business India Publications Ltd. has advanced loans amounting to Rs. 26,17,50,000/- to M/s Business India (firm) during FY 2007-08. The cumulative amount advanced as loan to M/s Business India as at 31.03.2008 is Rs. 1,68,81,30,909/-. The balance of accumulated profits in the books of Business India Publications Ltd as at 31.03.2007 is Rs. 12,44,54,676/- and the same as at 31.03.2008 is Rs. 16,77,15,820/-. Since the loans have been advanced by a company where the shareholding of Mr. Ashok Advani exceeds 10% and the same have been advanced to the firm M/s Business India, wherein he is a partner having 95% share, the loans so advanced clearly attracts the provisions of section 2(22)(e) of the IT Act, 1961. From the above, I have reasons to believe that there is an escapement of income to the extent of Rs. 12,44,54,676/-for AY 2007-08. Hence, the case is reopened." 4. Thereafter, notice....
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.... BOTH. The A.O. had, in consequence of this new information, reason to believe that income to the extent of deemed dividend escaped assessment. Appellant has not been able to establish "change of opinion" in terms of law laid down in Usha Inttl. (FB) judgment 348 ITR 485 (Del.) (FB). The new material is for us to see in form of information from another officer. Moreover no challenge was mounted before A.O. The ground is rejected. 6. Further, Ld. CIT(A) also dismissed the appeal of the assessee on merit. 7. Aggrieved with the above order, assessee preferred an appeal before us with the following grounds:- 1. On the facts and in the circumstances of the case Ld. CIT (Appeals) erred in rejecting the Ground that the re-opening of the assessment was bad in law. 2. On the facts and in the circumstances of the case Ld. CIT (Appeals) erred in holding that the amounts received from Business India Publications Limited was not a trade advance. 3. On the facts and in the circumstances of the case Ld. CIT (Appeals) erred in holding that the amounts received by the Assessee from Business India Publications Limited, is taxable as dividend in the hands of Shri Ashok Advani in his capacity ....
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....on. This Court held that an assessment order passed after detailed discussion cannot be reopened within a period of four years from the end of the relevant assessment year unless the AO has reason to believe that due to some inherent defect in the assessment the income chargeable to tax has been under assessed or assessed to a lower rate or excessive relief is granted or excessive loss or depreciation allowance or any other allowance under the Act has been computed. In the subsequent judgment of the Supreme Court in CIT Vs. . Kelvinator of India Ltd. (2010) 228 CTR (SC) 488 : (2010) 34 DTK (SC) 49 : (2010) 320 ITR 561 (SC) the Supreme Court has held that wide as the power u/s. 147 is after 1st April, 1989 a mere change of opinion cannot justify the reopening of an assessment and there must be tangible material before the AO before he proceeds to exercise his powers u/s. 147. In the judgment of this Court in German Remedies this Court, while selling aside the exercise of the power, adverted to the circumstance that the very there must be tangible material before the AO before he proceeds to exercise his powers u/s. 147. In the judgment of this Court in German Remedies this Court, ....
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....bmitted that assessee is objecting before the bench that AO has not disposed all the objections before completing the assessment and assessee has raised the objections after the lapse of 2 years. She submitted that there has to be a reasonable time limit for disposal of the objections in line of the directions of Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd vrs. ITO (259 ITR 19) (SC) and she further submitted that the case laws relied by Ld. AR are distinguishable to the facts of the present case. 14. In the rejoinder, Ld. AR submitted that AO has forwarded the reasons for reopening only on 10th April 2014 and immediately on 21st April 2014, assessee has filed its objections, therefore Ld. DR cannot blame that objections were filed belatedly by the assessee, even though the department itself forwarded the objections with such delay. 15. Ld. AR further submitted that assessee has filed penalty appeals in caution and since Ld. CIT(A) has dismissed the appeals on merits, the penalty itself become infructuous. He further submitted that the facts involved are also similar in the appeal for AY 2008-09 and penalty was also filed with due caution. 16. Considered the ....