AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (7) TMI 1671
X X X X Extracts X X X X
X X X X Extracts X X X X
....2014. The assessment was framed by DCIT(OSD)-I, CR-7, Mumbai for the assessment year (A.Y.) 2005-06 vide his order dated 07.3.2013, u/s. 143(3) r/w s. 147 of the Income Tax Act, 1961 ('the Act' hereinafter). 2. At the outset, the ld. Counsel for the assessee stated that it has raised the jurisdictional issue in the assessee's cross-objection and, hence, the CO should be taken up first. 3. The only issue in the CO of the assessee is as regards the upholding by the ld. CIT(A) of the reopening of assessment beyond the period of four years under section 148 r/w s. 147 of the Act despite the fact that all the primary conditions in terms of proviso to section 147 of the Act are satisfied. For this, the assessee has raised following grounds:....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s passed. Subsequently, a notice u/s. 148 of the Act was issued on 03.5.2011. The reopening was made on the basis of the reason that the assessee has claimed excess depreciation on editing equipments and for this the A.O. recorded the following reasons: 'Reasons for the belief that income has escaped assessment in the case of M/s. Prime Focus Ltd. (PAN: AAACP6811B) for A.Y. 2005-06 within the meaning of Section 147 of the Income Tax Act. 1961. The assessee has filed its return of income for Assessment Year 2005-06 on 25/11/2005 declaring total income of Rs.6,66,64,980/ -. The assessment was completed u/s.143(3) of the Income Tax Ad, 1961 on 28.12.2007 determining total income at Rs.7,62,30,130/- On verification of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Depreciation allowed by the Department Rs.8,63,42,663/- Excess depreciation allowed Rs.5,03,66,553/- The assessee company has claimed excess depreciation; on Editing equipments though the same is not allowable. In this case provisions of section 147 of the Income tax Act, 1961 are clearly applicable as there is failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment.' The A.O. framed the reassessment u/s. 143 r/w s. 147 of the Act by allowing depreciation on 'computer based' editing equipments at 25%, as against @ 60% claimed by the assessee treating the same as computer. Aggrieved, the assessee preferred an appeal before the CIT(A), whereby the assessee challenged....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n 03.5.2011, and the reopening is thus beyond four years from the end of the relevant assessment year. According to him, the assessee's case falls under the first proviso to section 147 of the Act. The assessee, he continued, filed complete details in respect of the claim for depreciation, i.e., list of editing equipments, being 'computer based', 'recorder based' and 'others', in the original assessment proceedings, in response to the queries raised, taking us through the relevant part of the questionnaire dated 05.9.2006, forming part of notice u/s. 142(1), which we may reproduce for ready reference: '41. Produce the list of editing equipment - "computer based" with name and addresses of the parties/companies from whom the new equ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....facts necessary for its assessment. In view of these facts, it was submitted that the reopening is bad in law. The ld. DR relied on the orders by the Revenue authorities and could not controvert any of the contentions made (with reference to the record) by the ld. AR. 6. We have heard the parties, and perused the material on record. The reassessment in the instant case is clearly beyond a period of four years from the end of the relevant assessment year. We firstly note that the reasons recorded state that the computer is a part comprising the editing equipment and not the whole of it, so that it does not by itself qualify to be a computer. This is precisely what the assessee states when it classifies the editing equipments as 'com....
X X X X Extracts X X X X
X X X X Extracts X X X X
....observe no lapse on the part of the assessee to disclose fully and truly all the material facts necessary for the computation of its income, and neither has any been pointed to us, the claim has been subject to verification by the A.O. in the original proceedings. Further, though there is no discussion by him in the assessment order, he can only be considered as conscious and alive to this claim as the assessee had clearly bifurcated the editing equipments into two components, i.e., recorder based/others and computer based, claiming depreciation at the general and the enhanced rate (of 60%) thereon respectively, filing details in their respect, called for separately. This then is a case of review, impermissible under the Act. The ld. CIT....