2020 (12) TMI 46
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....nal, vide order dated 14th June 2019, recalled the appeal order for the limited purpose of deciding the legal issue concerning validity of re-opening of assessment under section 147 of the Act. This is how the appeals came up for hearing before us. 3. As mentioned above, in both the appeals, the assessee has raised more or less identical grounds challenging the validity of assessment under section 147 of the Act. At the outset, we will deal with the appeal being ITA no.384/Chd./2008. 4. Brief facts are, the assessee is a nationalized bank. For the assessment year 1999-2000, the assessee had filed its return of income on 27th December 1999, declaring total income of Rs. 169,04,50,060. The return of income filed by the assessee was subjected to scrutiny and after calling for various details and examining them, the Assessing Officer completed the assessment under section 143(3) of the Act vide order dated 19th March 2002, determining the total income at Rs. 241,44,54,651. The variation between the total income returned and total income determined was due to certain disallowances/additions made by the Assessing Officer. Being aggrieved with the assessment order so passed, the assess....
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....vt. Ltd. v/s DCIT, [2019] 382 ITR 333 (Bom.). He submitted, in the course of original assessment proceedings, the Assessing Officer has specifically enquired into assessee's claim of deduction under section 36(1)(viia) of the Act. In reply, the assessee had also furnished the details of its rural advances, branch wise, and also justified its claim of deduction. He submitted, after considering the submissions of the assessee and after making necessary enquiry, the Assessing Officer had disallowed the entire claim made by the assessee. Therefore, he submitted, when in the original assessment proceedings, the Assessing Officer has applied his mind and examined the issue, the re-opening of assessment on the very same issue is on a mere change of opinion, hence, impermissible. Finally, he submitted, against the disallowance of deduction claimed under section 36(1)(viia) of the Act in the original assessment order, the assessee had preferred appeal before learned Commissioner (Appeals) and learned Commissioner (Appeals) has deleted such disallowance. Therefore, since the issue having been considered in the original assessment proceedings and merged in the order passed by learned Commiss....
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....nt by the Assessing Officer, a copy of which is at Page-67 of the paper book, it is observed that re-opening of assessment is for two reasons. The first reason is relating to claim of depreciation on various categories of securities. Whereas, the second reason for which the assessment was re-opened is relating to deduction claimed under section 36(1)(viia) of the Act. As regards the first reason, admittedly, no disallowance or addition has been made in the re-assessment order. This, in other words, means the Assessing Officer himself was satisfied that there is no escapement of income on this issue. As regards the second reason relating to claim of deduction under section 36(1)(viia) of the Act, specific allegation of the Assessing Officer is, some of the branches in respect of which the assessee claimed deduction, did not qualify as rural branches as per Censes Department. It is worth mentioning, in course of original assessment proceedings, the Assessing Officer had noticed that the assessee had claimed the following deductions under section 36(1)(viia) of the Act:- Deduction u/s 36(1)(viia) being 5% of the total income Rs. 11,56,95,424 Deduction u/s 36(1)(viia) i.e., 10% of t....
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....inal assessment the Assessing Officer was also conscious of the fact that some of the branches may not qualify as rural branches. In view of the aforesaid, it cannot be said that the Assessing Officer has not applied the mind to the issue during the original assessment proceedings. That being the case, the re-opening of assessment under section 147 of the Act again on the selfsame issue, which was examined during the original assessment proceedings, is on a mere change of opinion or for review of the decision taken in original assessment order. 13. As observed by us, the Assessing Officer has disallowed the entire deduction claimed under section 36(1)(viia) of the Act and one of the reasons for such disallowance is, some of the branches may not qualify as rural branches. It is another matter that the aforesaid disallowance made by the Assessing Officer was deleted by the first appellate authority. However, the very fact that the Assessing Officer has disallowed the entire deduction claimed by the assessee under section 36(1)(viia) of the Act, leaves no room for escapement of income as, in reality, no income has escaped assessment due to disallowance of the entire deduction claimed....