TaxTMI 
TaxTMI 
2019 (8) TMI 1816
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....see's appeal before the Ld. Commissioner of Income Tax (A) was successful inasmuch as the Ld. Commissioner of Income Tax (A) deleted all the additions and disallowances except for a disallowance of Rs. 784/-. 2.1 Subsequently, the Assessing Officer issued notice u/s 154 vide notice dated 6.9.2010 intending to rectify the assessment order by proposing a disallowance of Rs. 11,88,14,381/- being alleged ad hoc provision made for liability on account of rent. The assessee gave a detailed reply to the Assessing Officer and submitted that the proposed disallowance of Rs. 11,88,14,381/- already stood offered for taxation in the return of income filed by the assessee and, therefore, there was no cause for any further proceedings in the matter. The Assessing Officer dropped the proceedings u/s 154 of the Act. 2.2 Subsequently, on 30.03.2012, the Assessing Officer issued notice u/s 148 proposing to reassess the income of the assessee. On request of the assessee, the reasons for reopening the case were supplied to the assessee which are reproduced hereunder:- "The assessee filed return showing income of Rs. 14,55,85,510/- on 30.10.2007. The assessment was completed on 25,09,200....
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.... Tax (A) and has raised the following grounds of appeal:- "1. On the facts and in the circumstances of the case and in law the CIT(A) has erred in holding proceedings pursuant to the notice u/s 148 of the Act to be valid in the admitted absence of any fresh material in the subject case; 2. On the facts and in the circumstances of the case and in law, the CIT(A) erred in confirming the re-assessment order dated 30.11.2012 on erroneous and extraneous reasonings; 3. On the facts and in the circumstances of the case and in law the CIT (A) erred in confirming the re-assessment order dated 30.11.2012, which is clearly based on a change of opinion; 4. On the facts and in the circumstances of the case and in law the CIT (A) has erred in disallowing the rent payable to Directorate of Estates in a sum of Rs. 4,19,42,469/-, erroneously holding it to be a contingent liability. All the above actions, being fallacious and against law, merit to be quashed, with directions for appropriate relief to the appellant. The appellant craves leave to add, delete, modify and/or forego all or any of the above grounds of appeal." 3.0 The learned Author....
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....question no. 6 of the said notice merits particular attention wherein the Assessing Officer had asked the assessee to explain the comparative gross profit rate and the reason for the fall of gross profit in the year. It was further submitted that in response thereto, the assessee had submitted that the rate of GP had fallen because an amount of Rs. 4.19542/- crore on account of rent of 'A' Barracks was debited to the profit and loss account. It was submitted that, thus, even at the time of assessment, the Assessing Officer was aware that the impugned amount pertained to liability of rent for the premises at 'A' Barracks Janpath for the period 16.10.1999 to 10.10.2001. It was also submitted that even during the course of assessment proceedings u/s 154, the Assessing Officer was duly made aware of the said liability of rent. 3.3 It was submitted that reliance was being placed on the judgment of the Hon'ble Bombay High Court in the case of State Bank of India vs. ACIT reported in (2018) 96 Taxmann.com 77 (Bombay) wherein the Hon'ble Bombay High Court had held that when a claim is accepted in the documents which was fundamental to assessment under the Income Tax Act, it must necessa....
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....2017) 82 taxmann.com 10 (SC)/(2017) 248 Taxman 81 (SC) iii) Gujarat Ambuja Exports Ltd. Vs DCIT. (2017) 86 taxmann.com 69 (Gujarat) iv) PCIT Vs Paramount Communication (P.) Ltd. (2017-TIOL- 253-SC-IT) v) PCIT Vs Paramount Communication (P.) Ltd. (2017) 79 taxmann.com 409 (Delhi)/(2017) 392 ITR 444 (Delhi) vi) Indu Lata Rangwala Vs DCIT (2017) 80 taxmann.com102(Delhi)(2016) 384 ITR 337 (Delhi)/(2016) 286 CTR 474 (Delhi) vii) Thakorbhai Maganbhai Patel Vs ITO (2017) 78 taxmann.com 201 (SC)/(2017) 245 Taxman 333 (SC) viii) Thakorbhai Maganbhai Patel Vs ITO (2017) 79 taxmann.com 409 (Delhi)/(2017) 392 ITR 444 (Delhi) ix) Aravali Infrapower Ltd. Vs PCIT (2017-TIQL-42-SC-IT) x) Aravali Infrapower Ltd. Vs DCIT (2017) 77 taxmann.com 322 (Delhi)/(2017) 390 ITR 456 (Delhi) xi) Yogendrakumar Gupta Vs ITO (51 taxmann.com 383) (SC)/(2014) 227 Taxman 374 (SC) xii) Raymond Woollen Mills Ltd. v. ITO And Others (236 ITR 34) xiii) R.K. Malhotra ITO Vs Kasturbhai Lalbhai (1977) 109 ITR 537 (SC) xiv) CIT Vs P.V.S. Beedies (P.) Ltd. (1999) 103 Taxman 294 (SC)/(1999) 237 ITR 13 (SC/(1999) 155 CTR ....
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.... the second time during the course of proceedings u/s 154 and in both these proceedings, no adverse inference was drawn by the Assessing Officer inasmuch as the returned income was accepted during the course of original assessment proceedings and the proceedings initiated u/s 154 were dropped without making any addition. 5.1 A perusal of the record as well as the reasons would also indicate that there was no fresh material which had come in possession of the Assessing Officer prior to the issuance of notice u/s 148 and even in the reasons, the Assessing Officer has duly stated that the issue came to light after the assessment records were examined and it was found that as per Schedule 10 of the balance sheet, certain amount of provision was made which should have been disallowed and added back to the income of the assessee. Thus, it is a clear case where the Assessing Officer has had a change of opinion on the issue since the Assessing Officer had raised a specific query regarding fall in gross profit and it had been submitted that the reason for the fall in gross profit, amongst other reasons, was also rent of 'A' Barracks. It follows by implication that the issue was duly cons....