TaxTMI 
TaxTMI 
TaxTMI 
2022 (2) TMI 1093
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....ime to all NBFCs. It is petitioner's case that RBI had, by Notification No. DNBS 193/DG(VL) - 2007 dated 22nd February, 2007, issued directions relating to prudential norms to NBFC in exercise of its powers conferred under Reserve Bank of India Act, 1934 (RBI Act). Clause 3(2) of the said directions require that income including interest/discount or any other charges of NPA (Non-Performing Assets) shall be recognised only when it is actually realised. In compliance with said requirement petitioner recognised income of NPA only when it is actually realised. The said income accordingly was not offered to tax in the return of income on accrual basis but is offered to tax on actual receipt basis. Petitioner stated that in its Annual Report of p....
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.... its objections to the said notice. Thereafter, by a letter dated 6th August, 2021 from respondent petitioner received reasons for re-opening. In the objections to the re-opening, petitioner raised various points including the fact that interest and other charges on NPA ought to be taxed on actual realisation basis and not on accrual basis and placed reliance on judgment of the Delhi High Court in the matter of Commissioner of Income Tax vs. Vasisth Chay Vyapar Ltd.[2011] 330 ITR 440 (Delhi). It was also brought to the notice of respondent that the Delhi High Court has held that where the assessee was NBFC it was governed by the provisions of RBI Act. In such a case, interest income could not be said to have accrued to the assessee having ....
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.... note that petitioner had, with the objections, also requested the Assessing Officer to provide photocopies of documents evidencing request sent by the Assessing Officer to the Principal Chief Commissioner of Income Tax/Chief Commissioner/Principal Commissioner/ Commissioner in terms of Section 151(1) of the Act for obtaining an approval for re-opening of the assessment for the year under consideration and documents evidencing the approval received from the Principal Chief Commissioner of Income Tax/Chief Commissioner/Principal Commissioner/ Commissioner. The Assessing Officer instead of providing these documents simply dismissed petitioner's request by saying it is purely an administrative matter and all correspondence have been made thro....
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....ially in those cases where the first proviso to Section 147 is attracted. The reasons to believe ought to also paraphrase any investigation report which may form the basis of the reasons and any enquiry conducted by the Assessing Officer on the same and if so, the conclusions thereof; (iii) where the reasons make a reference to another document, whether as a letter or report, such document and/or relevant portions of such report should be enclosed along with the reasons; (iv) the exercise of considering the assessee's objections to the reopening of assessment is not a mechanical ritual. It is a quasi- judicial function. The order disposing of the objections should deal with each objection and give proper reasons for the conclusion. ....
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....ities. In this case also the reasons for reopening the assessment have been stated in letter dated 6th August, 2021 addressed by the Assessing Officer. For ease of reference, the same is scanned and reproduced herein below :- Before the objections were disposed, petitioner had received a notice dated 11th November, 2021 under Section 143(2) read with Section 147 of the Act, annexed to which was the actual reasons recorded. The annexure, i.e., the reasons for ease of reference is scanned and reproduced herein below :- We are surprised to notice that paragraph no.3 in the actual reasons is missing in the letter dated 6th August, 2021. Paragraph no. 4 in the letter dated 6th August, 2021 is missing in the reasons given for obtaining a....