TaxTMI 
TaxTMI 
2022 (10) TMI 623
X X X X Extracts X X X X
X X X X Extracts X X X X
....ereinafter the 'Act') vide order dated 30.12.2018. 2. The first issue in this appeal of assessee is as regards to the order of CIT(A) confirming the action of AO in reopening of assessment u/s. 147 r.w.s 148 of the Act even though there is no failure on the part of the assessee to disclose fully and truly the material fact necessary for its assessment for the relevant assessment year and the original assessment was completed u/s. 143(3) of the Act. For this, assessee has raised various grounds regarding reopening which are exhaustive and argumentative, hence need not to be reproduced. 3. On behalf of the assessee, Shri R. Vijayaraghavan argued and on behalf of Revenue, Senior DR, Shri P. Sajit Kumar argued. Brief facts are that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e above, no other disclosure had been made. The issue of provision for return rights had not been examined by the Assessing Officer in the original assessment proceedings. The Assessing Officer did not have any occasion to take any option on the issue of provision for return rights. To this extent, this issue had escaped the attention of Assessing Officer. The assessee is incorrect in stating that there has been a change of opinion. In fact, no opinion had been taken on this issue by the Assessing Officer. The disclosure made is very cryptic and without any details or justification. This issue of wrongful claim of provisions for return rightly has come to the knowledge of the Assessing Officer subsequent to the conclusion of earlier assessm....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ch the company operates. In this regard, please find enclosed the workings of provision for returned rights amounting to Rs. 12,375,507 debited to the profit & loss statement as Annexure 15. c. Legal arguments for allowing provision created for returned rights We submit that as per section 37(1) of the Act, any expenditure not being in the nature of capital expenditure or personal expenses of the assessee, laid out or expended wholly and exclusively for the purposes of the business or profession shall be allowed in computing business income. Further, reliance is placed on the decision or the Honourable Supreme Court in the case of Rotork Controls India (P) Ltd. Vs. CIT ( 180 Taxman 422 ), wherein allowing the provision for warranty in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at the assessee has filed complete details of expenses and AO after considering the same has not made any addition. Now, the AO while issuing notice u/s. 148 records the reasons from the records and no tangible material has come to his notice. Even the AO has not demonstrated that there is any failure on the part of the assessee to disclose fully and truly all material facts for framing of assessment for the relevant assessment year and original assessment was completed u/s. 143(3) of the Act. The four year has elapsed from the end of the assessment year and after that reopening notice u/s. 148 of the Act was issued. The relevant assessment year involved is assessment year 2011-12 and original assessment was completed u/s. 143(3) of the Act....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or any other allowance, as the case may be, for the assessment year concerned (hereafter in this Section and in sections 148 to 153 referred to as the relevant assessment year): Provided that where an assessment under Sub-section (3) of Section 143 or this Section has been made for the relevant assessment year, no action shall be taken under this Section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under Section 139 or in response to a notice issued under Sub-section (1) of Section 142 or Section 148 or to disclose fully and truly all material facts necess....