TaxTMI 
TaxTMI 
2024 (3) TMI 665
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....2021 rejecting the objections raised by Petitioner to the reopening of assessment. The reopening of assessment has taken place within a period of four years from the end of the relevant AY. 3. Petitioner is a company incorporated under the Companies Act, 1956 engaged in the business of manufacture and distribution of lubricating oils, greases, brake fluids and specialty products. 4. Petitioner filed its return of income for the AY 2017-18 on 30th November 2017 declaring total income of Rs. 1043,79,64,000/- and made a disallowance of an amount of Rs. 15,27,42,467/- being the CSR amount in consonance with Explanation 2 to Section 37 of the Act. An amount of Rs. 6,18,60,803/- (being 50% of the aggregate donation) was deducted and claimed under Section 80G of the Act. This amount was donation in respect of approved trusts/institutions, for the purposes of Section 80G of the Act. The details of the donations were given in the computation of income, which formed part of the return of income. 5. Petitioner's return of income was selected for scrutiny. Pursuant to initiation of assessment proceedings, notices dated 5th April 2019 and 12th September 2019 were issued under Section 1....
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....f formed by the AO is based on an audit objection without fulfilling an objective criteria. He also submitted that the assessment cannot be reopened on the basis of a change of opinion and the belief so formed must be based on fresh and tangible material having a rational and a live nexus with the belief. Mr. Pardiwalla aligned the legal objections with the facts in the matter by pointing out the following: (i) Petitioner has not claimed the deduction of CSR expenses as business expenditure. (ii) Section 80G of the Act has no condition that such deduction shall not be allowed in respect of amounts spent out of CSR. (iii) The AO has formed his belief regarding escapement of income based on an audit objection without an independent application of mind and had earlier refused to accept the audit objection. (iv) Petitioner had made adequate disclosure regarding expenditure by way of CSR and deduction under Section 80G of the Act is made in the annual accounts, the tax audit report, the computation of income which was already considered by the AO while passing the original assessment order. Deduction under Section 80G of the Act was specifically menti....
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....r, AO has raised queries vide notices dated 5th April 2019 and 12th September 2019, each of which were duly responded by Petitioner. Petitioner has explained that no deduction was claimed by it except that under Section 80G of the Act. Copies of receipts of donations were also provided as proof of donation. All these details were also included in the computation of income. Petitioner has, thus, submitted detailed explanation along with supporting documents. It is also seen that Petitioner has claimed deduction for eligible donation as detailed in Schedule. We agree with Mr. Pardiwalla's submission that as far as donations given to eligible trust is concerned, it would still qualify as deduction under Section 80G of the Act even if the contribution is out of the CSR funds. The AO has examined all these aspects while passing the original assessment order. 13. The documents on record also indicate that the Audit Wing of the Department raised certain objections to the original assessment order including the issue of deduction under Section 80G of the Act. It is seen that the AO justified the original assessment order to the audit party without accepting any adjustment to the same. ....
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....l on the basis of which the original assessment order was passed. 16. It is a well settled principle of law that an AO has no power to review and this power is not to be confused with the power to re-assess. The Apex Court in Commissioner of Income Tax, Delhi v. Kelvinator of India Ltd. (2010) 2 SCC 723, has reiterated that mere change of opinion cannot be a ground for reopening concluded assessment. The observations made in paragraphs 6 and 7 read as below: "6. We must also keep in mind the conceptual difference between power to review and power to reassess. The assessing officer has no power to review; he has the power to reassess. But reassessment has to be based on fulfilment of certain precondition and if the concept of "change of opinion" is removed, as contended on behalf of the Department, then, in the garb of reopening the assessment, review would take place. 7. One must treat the concept of "change of opinion" as an in-built test to check abuse of power by the assessing officer. Hence, after 1-4-1989, the assessing officer has power to reopen, provided there is "tangible material" to come to the conclusion that there is escapement of income from asses....
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..... 2008-09. We are of the view that once a query is raised during the assessment proceedings and the assessee has replied to it, it follows that the query raised was a subject of consideration of the Assessing Officer while completing the assessment. It is not necessary that an assessment order should contain reference and/or discussion to disclose its satisfaction in respect of the query raised. If an Assessing Officer has to record the consideration bestowed by him on all issues raised by him during the assessment proceeding even where he is satisfied then it would be impossible for the Assessing Officer to complete all the assessments which are required to be scrutinized by him under Section 143(3) of the Act. Moreover, one must not forget that the manner in which an assessment order is to be drafted is the sole domain of the Assessing Officer and it is not open to an assessee to insist that the assessment order must record all the questions raised and the satisfaction in respect thereof of the Assessing Officer. The only requirement is that the Assessing Officer ought to have considered the objection now raised in the grounds for issuing notice under Section 148 of the Act, duri....