TaxTMI 
TaxTMI 
2025 (4) TMI 859
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....sessee originally filed its return of income under section 139(1) of the Act on 30.09.2015, declaring NIL income under normal provisions after claiming set-off of brought forward unabsorbed depreciation of Rs. 1,17,69,30,776/-. The book profit under section 115JB of the Act was declared at Rs. 2,51,70,02,648/-. 2.1. The case was selected for scrutiny and a notice under section 143(2) of the Act was issued on 21.09.2016. Subsequently, notices under section 142(1) of the Act along with questionnaires were issued on 21.09.2016 and 17.07.2017. 2.2. In the interim, the assessee filed a revised return of income under section 139(5) of the Act on 11.01.2017, declaring again NIL total income, but now claiming set-off of brought forward depreciation of Rs. 1,37,76,80,893/-, instead of the earlier figure. There was no change in the quantum of book profit. 2.3. The assessment was completed under section 143(3) of the Act vide order dated 05.12.2017, determining total income under normal provisions at Rs. 79,88,44,830/- and book profit under section 115JB of the Act at Rs. 3,55,56,13,645/-, after making various additions and disallowances including disallowance under section 14A of the Act,....
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....rmal provisions of the IT Act, 1961. The learned Pr. Commissioner of Income Tax ought to have appreciated that the appellant calculates and accounts depreciation on fixed assets after writing off (after deducting) such provision for the impairment loss. The amount of 71090.72 lacs is not merely provision for impairment loss, this amount is actually written off during the year under consideration which is direct expense and debited to Profit and Loss Account. 4.0 The learned Pr. Commissioner of Income Tax-1, Baroda erred in law and on facts has set aside the assessment order passed on 05-12-2017 under section 143(3) of the I T Act. 5.0 The above grounds of appeal are without prejudice to each other. 6.0 The appellant craves leave to add to, alter, delete or modify any of the grounds of appeal either before or at the time of hearing of this appeal. 3.1. The assessee also raised additional ground of appeal which are as follows: 1. Notice issued u/s. 263 dated 13.09.2019 and order passed u/s. 263 dated 22.06.2020 are bad in law as order passed u/s. 143(3) dated 05.12.2017, on which present revision proceedings was initiated, is legally unsustainable for want of issuance of....
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....n issue or has been adjudicated by a competent authority. 4.3. It is a settled legal principle that section 263 presupposes the existence of a valid assessment order. If the assessee was of the view that the assessment order passed on 05.12.2017 was vitiated by a jurisdictional defect-such as alleged non-issuance of notice under section 143(2) of the Act in relation to the revised return-the proper legal remedy available to the assessee was to challenge the same through an appeal under section 246A of the Act, or seek rectification under section 154 of the Act, or approach the Hon'ble High Court through writ jurisdiction, as may be appropriate in law. In the present case, the assessee did not raise any such challenge at the relevant time. No appeal was preferred against the assessment order, nor was any rectification sought. Upon enquiry, the AR submitted that the appeal might have been filed with the CIT(A) u/s 246A of the Act. The assessment order has attained finality and has not been declared invalid or void by any authority having competent jurisdiction. The assessee is now seeking to raise a jurisdictional ground collaterally, in the course of an appeal against the revisiona....
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....Company (MGCL) amounting to Rs. 21,69,24,000/- and Impairment Loss amounting to Rs. 10,90,72,000/-. 5.4. The assessee, in response to the show cause notice, submitted that both amounts were not merely provisions, but had been actually written off during the year in accordance with applicable Accounting Standards. It was contended that the amount of Rs. 21.69 crore represented actual write-off of loans advanced to Maha Gujarat Collieries Ltd. (MGCL), a joint venture company and that the impairment loss of Rs. 10.90 crore was based on impairment testing of fixed assets as per Accounting Standard-28, and therefore constituted a real and ascertained loss, allowable under section 37(1) of the Act. The assessee further submitted that both amounts were duly added back while computing book profit under section 115JB of the Act and, therefore, there was no prejudice caused to the Revenue. It was also submitted that these were subject matter of disclosure in the financial statements and notes to accounts and the assessment was completed after considering all relevant details. 5.5. In conclusion, the PCIT held that the assessment order passed by the AO under section 143(3) of the Act was er....
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....houghtful consideration to the submissions made by the learned AR and perused the material on record. There is no dispute that the assessee has debited the sum of Rs. 2169.24 Lacs as "provision for loan to JV" and Rs. 1090.71 Lacs as "impairment loss" to the profit and loss account. It is also not in dispute that these items have not been disallowed by the AO while computing income under the normal provisions of the Act. Further, the assessment order dated 05.12.2017 is completely silent on whether the AO examined the nature of these items, sought any explanation, or applied his mind to their allowability. 9. While the learned AR has now placed supporting explanations and accounting treatment to demonstrate that both items were actual write-offs and not mere provisions, these facts and justifications were neither called for nor verified by the AO at the time of original assessment. No documentary evidence or reference to the assessment proceedings was produced to show that these items were ever examined, questioned, or accepted by the AO upon due application of mind. 10. From the assessment order, it is evident that there is no discussion, reference, or indication that the AO exa....