TaxTMI 
TaxTMI 
2023 (2) TMI 719
X X X X Extracts X X X X
X X X X Extracts X X X X
....itioner, whereby the petitioner agreed to transfer its TDR to its subsidiaries. As per the terms of the MOU, the petitioner was required to obtain a Development Right Certificate (DRC) in the name of the subsidiary failing which the MOU was to stand cancelled. The petitioner claimed that it was unable to obtain the said DRC within the stipulated period and that finally the MOU was terminated vide Deed of Cancellation dated 18th March 2014. Consequently, the sale of TDR aggregating to Rs.403.80 Lakh which was shown as business income in the accounts for the year ended 31st March 2012 was reversed by the petitioner in its books of account and the reversal shown and disclosed on the face of the statement of profit and loss as well as in the Cash Flow Statement for the year ended 31st March 2014. A detailed note explaining the circumstances leading to the said reversal was also given in note No.25 forming a part of the financial statement for the year ended 31st March 2014. 3. The case of the petitioner is that the revenue from the sale of the TDR was treated as business income and were accordingly offered to tax in the return of income for the assessment year 2012-13, which was selec....
X X X X Extracts X X X X
X X X X Extracts X X X X
....flect the entry with regard to reversal of sale of transferable development rights, as also communication dated 16th September 2015, by virtue of which the petitioner had submitted copies of the audited financial statements to the AO along with tax audit report issued under section 44AB of the Act in response to the notice dated 28th August 2015 issued under section 143 of the Act. The petitioner also referred to the auditor's report with a view to emphasize that the entry with regard to reversal of sale of TDR was very much referred to and explained in detailed in the notes attached to the Auditor's report. In that background, it appears that the order of assessment under section 143(3) came to be passed on 2nd December 2016 . 5. Subsequently, the AO on 26th March 2021 issued a notice under section 148 of the Act seeking to reopen the assessment of the assessment year 2014-15 on the ground that income had escaped income within the meaning of section 147 of the Act. The reasons for reopening as furnished to the petitioner read as under : In this case, assessment for AY 2-14-15 was completed on 02.12.2016 accepting the returned loss of Rs.11,83,03,084/-. As per provisions of s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....me proper assessment to bring to tax appropriate income attributable to the above, which has escaped assessment. 6. Objections to reopening were filed by the petitioner in which it was highlighted that the basis of reopening recorded in the reasons had already been gone into during the regular assessment proceedings under section 143(3) of the Act and therefore, it was stated that the reopening was nothing but a change of opinion. The AO then appears to have sought confirmation from the assessee vide communication dated 9th January 2022 asking the petitioner to furnish documentary evidence that the issue had been specifically raised and dealt with during the original assessment proceedings. 7. The petitioner, in response, addressed a communication dated 24th January 2022 whereby reference was made to the communication dated 11th March 2015 which had been addressed to the AO during the regular assessment proceedings. A copy of the said communication was also furnished to the AO. However, the AO was not satisfied with the explanation so tendered and vide communication dated 9th April 2022, rejected the plea of the petitioner on the ground that there was no documentary evidence wha....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... vital link is the safeguard against arbitrary reopening of the concluded assessment. 11. In the present case, it can be seen that while the AO has made a plain statement that there was failure to disclose fully and truly the material facts, yet the AO has neither disclosed nor identified as to what were those material facts which were not disclosed in the earlier assessment proceedings. The AO, on the other hand, did record in the reasons that the assessee had fled audited profit and loss account, balance-sheet and other details/schedules, however, short of admitting that the details with regard to reversed sale of TDR had been reflected in the aforementioned documents and the return, proceeded to take shelter behind a non-existent excuse that the material facts were embedded in such a manner that the same could not be discovered with due diligence. It is difficult to accept this plea inasmuch as all these details were contained in the return of income in the audited accounts and profit and loss statement, also explained in the notes attached to the auditor's report, besides the communication dated 11th March 2015 issued by the AO pursuant to which the order of assessment under ....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., the ratio of the judgment in Jindal Photo Films Ltd. Vs. Deputy Commissioner of Income Tax [1998] 234 ITR 170 (Delhi) would squarely apply. In this case, it was held : "..........all that the Income-tax Officer has said is that he was not right in allowing deduction under Section 80I because he had allowed the deductions wrongly and, therefore, he was of the opinion that the income had escaped assessment. Though he has used the phrase "reason to believe" in his order, admittedly, between the date of the orders of assessment sought to be reopened and the date of forming of opinion by the Income-tax Officer nothing new has happened. There is no change of law. No new material has come on record. No information has been received. It is merely a fresh application of mind by the same Assessing Officer to the same set of facts. While passing the original orders of assessment the order dated February 28, 1994, passed by the Commissioner of Income-tax (Appeals) was before the Assessing Officer. That order stands till today. What the Assessing Office has said about the order of the Commissioner of Income-tax (Appeals) while recording reasons under Section 147 he could have said even in t....