2023 (1) TMI 429

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....n is fled, inter-alia, challenging the notice, dated 26th March 2021, issued u/s. 148 of the Income Tax Act, 1961 ('the Act'), whereby the reassessment proceedings are sought to be initiated against the petitioner for the assessment year 2015-16. 2. Briefly stated the material facts are as under : (a) The petitioner is a company engaged in the business of infrastructure development and running a Container Freight Station. Return of income for the assessment year 2015-16 was fled on 30th September 2015 and declared book profit u/s.115JB of the Act of Rs.8,72,54,012/-. The petitioner in its return claimed a deduction of Rs.10,24,27,306/- u/s. 80IA(4) of the Act. The case of the petitioner was selected for scrutiny for purposes of ....

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....s services defined in section 80-IA is only to be treated as Eligible Business. Further, infrastructure facility is defined in two places in the Act, i.e., in Explanation under section 80-IA(4)(i) as well as in Explanation (d) to section 10(23F) and clause (d) of the Explanation of clause (viii) of sub-section (1) of section 36. In 80-IA, other public facility as notified by Board was deleted vide Finance Act, 2001 w.e.f. 1.4.2002. Thus, Container Freight Station (CFS) is not an eligible infrastructural facility as provided in Explanation to Section 80-IA(4) of the Act. As per Boards clarification dated 6th January 2011, inland container depots and container freight stations are not ports located on any inland waterway, river or ca....

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....he order impugned dated 10th March 2022 on the ground that the notice u/s. 148 could not have been issued as the jurisdictional conditions for invoking the powers u/s. 147 of the Act are not satisfied. 7. Counsel for the petitioner urged that since more than four years have elapsed from the end of the relevant assessment year 2015-16, the notice impugned could not have been issued unless the Assessing Officer was satisfied that there was a failure on the part of the assessee to truly and fully disclose all material facts necessary for assessment for that assessment year. It was urged that even the reasons recorded did not anywhere allege that there has been failure on the part of the assessee to disclose fully and truly the material fact....

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....f section 80-IA(4) of the Act. 11. Admittedly, since the notice u/s. 148 was being issued after the expiry of four years from the end of the relevant assessment year, no action could be taken u/s. 147, after expiry of the said period unless it could be shown that the income chargeable to tax had escaped assessment by reason of the failure on the part of the assessee, inter-alia, to disclose fully and truly all material facts necessary for the assessment for that assessment year. 12. In the present case, from the record, it is quite clear that when the return fled by the petitioner was taken up for scrutiny assessment, information was called for by the Assessing Officer. The petitioner, in response to the notices so received, had submi....

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....not at all elucidate as to what material was not disclosed fully and truly, failure of which had led to the income escaping assessment. 14. In Hindustan Lever Ltd. Vs. R.B. Wadkar, Assistant Commissioner of Income-Tax and Others 2004 ITR 332 Vol.268, this Court held : " .......The reasons recorded should be clear and unambiguous and should not suffer from any vagueness. The reasons recorded must disclose his mind. The reasons are the manifestation of the mind of the Assessing Officer. The reasons recorded should be self-explanatory and should not keep the assessee guessing for the reasons. Reasons provide the link between conclusion and evidence. The reasons recorded must be based on evidence. The Assessing Officer, in the event....

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....re facilities for deduction under the section. In this case, assessment for A.Y. 2015-16 was completed after scrutiny assessing income at Rs.11195175 after allowing 80IA deduction of Rs.102010059. It was seen that the assessee was running a CFS for which the 80IA deduction was allowed to him. This is against the law as the Department is in appeal in Supreme Court and allowing deduction after getting favourable grant of SLP amounts to taking two different stands. 16. It, thus, appears that the basis for initiation of reassessment was the objection by the Director General of Audit (Central) Mumbai and further that the Supreme Court had been pleased to entertain a Special Leave Petition against the judgment in Continental Warehousi....