RITES LTD., NEW DELHI v. ADDL. CIT, SPL. RANGE- 7, NEW DELHI

ITA 59/DEL/2018 | 2009-2010
Pronouncement Date: 17-05-2021 | Result: Allowed

Appeal Details

RSA Number 5920114 RSA 2018
Assessee PAN AAACR0830Q
Bench Delhi
Appeal Number ITA 59/DEL/2018
Duration Of Justice 3 year(s) 4 month(s) 14 day(s)
Appellant RITES LTD., NEW DELHI
Respondent ADDL. CIT, SPL. RANGE- 7, NEW DELHI
Appeal Type Income Tax Appeal
Pronouncement Date 17-05-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted F
Tribunal Order Date 17-05-2021
Last Hearing Date 18-02-2021
First Hearing Date 18-02-2021
Assessment Year 2009-2010
Appeal Filed On 03-01-2018
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F NEW DELHI BEFORE SHRI ANIL CHATURVEDI ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA JUDICIAL MEMBER I.T.A. NO.59/DEL/2018 ASSESSMENT YEAR: 2009-10 RITES LTD. SCOPE BUILDING SCOPE MINAR LAXMI NAGAR NEW DELHI. VS. ADDL. CIT SPECIAL RANGE-7 NEW DELHI. TAN/PAN: AAACR0830Q (APPELLANT) (RESPONDENT) I.T.A. NO.680/DEL/2018 ASSESSMENT YEAR: 2009-10 ADDL. CIT SPECIAL RANGE-7 NEW DELHI. VS. RITES LTD. SCOPE BUILDING SCOPE MINAR LAXMI NAGAR NEW DELHI. TAN/PAN: AAACR0830Q (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI R. S. SINGHVI CA AND SHRI SHRI SATYAJIT GOEL CA RESPONDENT BY: SHRI GOVIND SINGHAL SR.D.R. DATE OF HEARING: 18 02 2021 DATE OF PRONOUNCEMENT: 17 05 2021 O R D E R PER AMIT SHUKLA JM THE AFORESAID CROSS APPEALS HAVE BEEN FILED BY THE REVENUE AS WELL AS BY THE ASSESSEE AGAINST IMPUGNED ORDER DATED 16.10.2017 PASSED BY LD. CIT(A)-XXXVIII DEL HI FOR THE QUANTUM OF ASSESSMENT PASSED U/S.147/143(3) FOR THE ITA NO.59 & 680/DEL/2018 2 ASSESSMENT YEAR 2009-10. IN THE REVENUES APPEAL ON LY GROUNDS RAISED READS AS UNDER: 1. ON THE FACTS AND UNDER THE CIRCUMSTANCES OF THE CASE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN DELETING THE A DDITION OF RS.483.69 LAKHS BEING DONATION TO THE RAILWAY MINIS TER WELFARE AND RELIEF FUND IGNORING THAT IT WAS A CSR EXPENSES WHICH IS NOT AN ALLOWABLE EXPENDITURE FOR BUSINESS PURPOSE U/S.37(1) OF THE IT ACT. 2. WHEREAS IN THE ASSESSEES APPEAL THE ASSESSEE H AS RAISED VARIOUS GROUNDS ESPECIALLY CHALLENGING VALI DITY OF REOPENING U/S.147/148. THE GROUNDS RAISED BY THE AS SESSEE READ AS UNDER: 1(I) THAT ON FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS NOT JUSTIFIED IN UPHOLDING VALIDITY OF N OTICE U/S 148 WITHOUT APPRECIATING PROVISO TO SECTION 147 OF THE INCOME TAX ACT 1961. (II) THAT ORIGINAL ASSESSMENT HAVING BEEN COMPLETED U/S 143(3) AND THERE BEING NO CASE OF ANY FAILURE ON PART OF T HE ASSESSEE IN DISCLOSING FULL AND TRUE PARTICULARS OF INCOME AT T HE TIME OF ORIGINAL ASSESSMENT THE CASE FALLS UNDER THE FIRST PROVISO TO SECTION 147 AND AS SUCH THE IMPUGNED NOTICE U/S 148 IS INVALID AND WITHOUT JURISDICTION. (III) THAT IN ABSENCE OF ANY NEW TANGIBLE MATERIAL THE REASONS RECORDED ARE MERELY ON THE BASIS OF MATERIA L ALREADY ON RECORD AND AS SUCH THE REOPENING U/S 148 IS BASED O N CHANGE OF OPINION AND SAME IS BAD IN LAW. (IV) THAT EVEN OTHERWISE RE-APPRECIATION OF SAME MATERIAL BEING IMPERMISSIBLE UNDER THE PROVISIONS OF SECTION 148 THE ITA NO.59 & 680/DEL/2018 3 REASSESSMENT PROCEEDINGS ARE INVALID AND IN CONTRAV ENTION TO THE SCHEME OF THE ACT. 2(I) THAT ON FACTS AND CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING DISALLOWANCE OF RS 87.54 LAKHS BEING CLAIM OF BUSINESS LOSS IN RESPECT OF UN REALIZED CLAIM OF TDS WHICH IS A PERMISSIBLE DEDUCTION U/S 37/36( 1)(VII) OF THE INCOME TAX ACT 1961. (II) THAT THE CLAIM IS IN RESPECT OF UNREALIZED TDS CREDIT AND SAME BEING A GENUINE BUSINESS LIABILITY OR UNREALIZED DE BT THE DISALLOWANCE IS ILLEGAL ARBITRARY AND IN DISREGARD TO PROVISIONS OF SECTION 37/36(L)(VII) OF THE ACT. (III) THAT IN ANY CASE THE DISALLOWANCE IS MERELY ON THE BASIS OF CHANGE OF OPINION AND SAME IS NOT SUSTAINABLE IN TH E CASE OF REASSESSMENT U/S 147 OF THE ACT. 3(I) THAT ON FACTS AND CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING DISALLOWANCE OF RS. 77.86 LAKHS ON ACCOUNT OF CLAIM OF WARRANTY AND COMMITMEN T CHARGES. (II) THAT THE CLAIM OF WARRANTY AND COMMITMENT CHAR GES IS IN RESPECT OF BUSINESS ACTIVITIES OF THE APPELLANT AND SAME BEING INTEGRAL PART OF THE BUSINESS THE DISALLOWANCE IS MISCONCEIVED AND IN TOTAL DISREGARD TO PAST HISTORY OF THE CASE. (III) THAT THE CLAIM OF WARRANTY AND COMMITMENT CHA RGES BEING A REGULAR FEATURE AND BASED ON REASONABLE EST IMATES THE IMPUGNED DISALLOWANCE IS IN TOTAL DISREGARD TO PAST ACCEPTED HISTORY AND PRINCIPLE LAID DOWN BY HONBLE SUPREME COURT. (IV) THAT IN ANY CASE THE DISALLOWANCE IS MERELY O N THE BASIS OF CHANGE OF OPINION AND SAME IS NOT SUSTAINA BLE IN THE CASE OF REASSESSMENT U/S 147 OF THE ACT. 4. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE THE ASSESSING OFFICER HAS ERRED IN NOT ALLOWING FULL CREDIT OF TD S AND ADVANCE ITA NO.59 & 680/DEL/2018 4 TAX AS APPEARING IN FORM 26AS AND SUPPORTED FROM TD S CERTIFICATES ON RECORD. 5. THAT THE ASSESSEE CRAVES LEAVE TO ADD AMEND AL TER OR FORGO ANY OR ALL OF THE GROUNDS AS MAY BE NECESSARY AND I N THE INTEREST OF JUSTICE. 6. THAT THE ORDERS OF LOWER AUTHORITIES ARE NOT JUS TIFIED ON FACTS AND SAME ARE BAD IN LAW. 3. SINCE ASSESSEE HAS CHALLENGED THE VERY VALIDITY OF RE- ASSESSMENT PROCEEDINGS THEREFORE SAME IS BEING TA KEN UP FIRST. 4. THE BRIEF FACTS ARE THAT THE ASSESSEE IS A GOVER NMENT OF INDIA UNDERTAKING ENGAGED IN THE BUSINESS OF CONSUL TANCY IN TRANSPORT SECTOR IN INDIA AND ABROAD AND OTHER ADDI TIONAL ACTIVITIES SUCH AS EXPORTS AND LEASING TECHNICAL C ONSULTANCY ETC. THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2 009-10 WAS FILED ON 25.09.2009 DECLARING INCOME OF RS.196 51 50 476/- WHICH WAS LATER ON REVISED TO RS.191 59 00 220/-. THE SAID RETURN WAS SELECTED FO R SCRUTINY AND THEREAFTER ASSESSMENT WAS PASSED U/S.143(3) VID E ORDER DATED 03.03.2013 AT AN INCOME OF RS.196 64 28 067/- WHEREIN VARIOUS ADDITIONS/DISALLOWANCES WERE MADE W HICH ULTIMATELY GOT DELETED FROM THE STAGE OF LD. CIT(A) AND ITAT. AFTER THE COMPLETION OF THE ASSESSMENT IN THE AFORE SAID MANNER THE ASSESSING OFFICER SOUGHT TO REOPEN THE CASE U/S. 147 VIDE ISSUANCE OF NOTICE U/S.148 ON 23.03.2016 W HICH WAS AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR ON THE GROUND OF ESCAPEMENT OF INC OME AND ITA NO.59 & 680/DEL/2018 5 RE-VERIFICATION OF FACT ALREADY AVAILABLE ON RECORD . THE REASONS RECORDED BY THE ASSESSING OFFICER FOR REOPENING THE ASSESSMENT READ AS UNDER: IN THIS CASE THE ASSESSEE FIFED ITS RETURN OF INC OME ON 25.09.2009 AT AN INCOME OF RS 1 96 51 50 476/-. THE REAFTER THE ASSESSEE HAD FILED REVISED COMPUTATION OF INCOME DE CLARING INCOME AT RS. 1 91 59 00 220/-. THE ASSESSMENT ORDE R U/S 143(3) WAS PASSED ON 03.03.2013 AT AN INCOME OF RS. 1 96 64 28 064/-. THE ASSESSEE IN THIS CASE IS ENGA GED IN THE FIELD OF RAILWAY SECTOR. 2 SUBSEQUENTLY IT WAS NOTICED THAT AS PER PROFIT AND LO SS ACCOUNT THE ASSESSEE HAS DEBITED RS. 87.54 LAKH AND RS. 77 86 LAKH FOR PROVISION DOUBTFUL ADVANCES TDS & BANKS A ND COMMITMENTS RESPECTIVELY. AS THE PROVISION MADE WAS NOT AN ASCERTAINED LIABILITY AS SUCH EXPENDITURE WAS NOT A LLOWABLE. 3 IN ADDITION IT WAS NOTICED THAT THE ASSESSEE IN POINT NO. 13(D) OF 3 CED REPORT HAD DECLARED THAT IT DID NOT RECOGNIZE INCOME OF RS.1704.53 LAKH (AS PER POINT N O.7 OF SCHEDULE B AND NO.15 TO NOTES TO ACCOUNTS) FROM ITS SUBSIDIARY. ON THE OTHER HAND THE ASSESSEE HAD MADE A PROVISIO N OF RS.6300 LAKHS TOWARDS EXPOSURE IN TANZANIA RAILWAYS LTD TANZANIA A FOREIGN SUBSIDIARY AGAINST WHICH INCOME OF RS. 1704.53 LAKH WAS NOT OFFERED BY THE ASSESSEE. AS SU CH INCOME RS. 1704.53 LAKH WAS NOT ASSESSED. 4. AGAIN IT WAS NOTICED THAT THE ASSESSEE HAS MADE DONATION OF RS. 483.69 LAKH FOR RAILWAY MINISTER WE LFARE & RELIEF FUND SCRUTINY OF ASSESSMENT RECORD REVEALS T HAT THE AMOUNT OF DONATION IS NOT AN ALLOWABLE DEDUCTION U/ S 80G AS ITA NO.59 & 680/DEL/2018 6 PER INCOME LAX ACT. FURTHER THE ASSESSMENT RECORD OF THE ASSESSEE DID NOT SHOW ANY EVIDENCE OF PAYMENT THE S AID DONATION. 5. AFTER PERUSAL OF THE ABOVE MENTIONED INFORMATION AND FACTS I HAVE REASON TO BELIEVE THAT AN INCOME OF AT LEAST RS. 2353.62 LACS FOR AY. 2009-10 HAS ESCAPED FROM ASSES SMENT. APPROVAL FOR INITIATING PROCEEDINGS U/S. 147 R W. 1 49(1)(B) R.W.S. 151 OF THE INCOME TAX IS REQUESTED FROM PCIT-7 NEW DELHI FOR DETERMINATION OF INCOME OF THE ASSESSEE IN AY 2009- 10. 5. THEREAFTER THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S.147/143(3) VIDE ORDER DATED 31.12.20 16 AFTER MAKING FOLLOWING ADDITIONS:- A. CLAIM OF UNREALIZED DEBT RS.87 54 000/ - B. DISALLOWANCE OF COMMITMENT CHARGES RS.77 86 000 /- C. DISALLOWANCE OF EXPENSES RS.4 83 69 000/ - 6. VALIDITY OF REOPENING WAS CHALLENGED BEFORE THE LD. CIT (A) ALSO AND DETAILED SUBMISSIONS WERE MADE WHICH W ERE DEALT AND INCORPORATED IN THE IMPUGNED APPELLATE ORDER FR OM PAGES 2 TO 7. HOWEVER THE LD. CIT (A) REJECTED THE ASSES SEES CONTENTION AFTER CONCLUDING AS UNDER: 3.4 THUS INFORMATION ON BASIS OF WHICH ASSESSING OFFICER HAD INITIATED PROCEEDINGS UNDER SECTION 147 WAS CERTAIN AND IT COULD BE CONSTRUED TO BE SUFFICIENT AND RELEVANT MATERIAL ON BASIS OF WHICH A REASONABLE PERSON COULD HAVE FORMED A BELIE F THAT INCOME HAD ESCAPED ASSESSMENT. IT IS ALSO OBSERVED THERE WAS DUE COMPLIANCE OF PROVISIONS OF SECTION 151 OF IT A CT 1961. THUS THERE WAS REASON TO BELIEVE THAT INCOME OF TH E APPELLANT- ITA NO.59 & 680/DEL/2018 7 COMPANY HAD ESCAPED ASSESSMENT ON ACCOUNT OF FAILUR E ON THE PART OF THE APPELLANT TO DISCLOSE FULLY AND TRULY A LL MATERIAL FACTS/PARTICULARS OF ITS INCOME NECESSARY FOR ITS A SSESSMENT. FOR THE REASONS MENTIONED ABOVE IT HAS TO BE HELD THAT THE REASSESSMENT PROCEEDINGS INITIATED BY THE ASSESSING OFFICER WERE WITHIN JURISDICTION AND VALID IN THE EYES OF L AW IN AS MUCH AS REASONS RECORDED BY THE ASSESSING OFFICER SATISF IED THE REQUIREMENT OF SECTION 147. THE DECISIONS RELIED UP ON BY THE AR ARE ON A DIFFERENT FOOTING. THEREFORE REASSESSMENT /PROCEEDINGS INITIATED BY THE ASSESSING OFFICER UNDER SECTION 14 7/148 ARE UPHELD. 7. WE HAVE HEARD BOTH THE PARTIES AT LENGTH AND PER USED THE RELEVANT FINDING GIVEN IN THE IMPUGNED ORDER AS WELL AS MATERIAL PLACED ON RECORD. ON PERUSAL OF THE REASO N RECORDED AND MATERIAL ON RECORD IT IS AN UNDISPUTED FACT TH AT IN THIS CASE THE ORIGINAL ASSESSMENT U/S.143(3) WAS MADE VI DE ORDER DATED 03.03.2012 AFTER DETAILED SCRUTINY PROCEEDING S AND VERIFICATION OF AUDITED ACCOUNTS AUDIT REPORT AND BOOKS OF ACCOUNT. THEREAFTER VARIOUS DISALLOWANCES WERE MAD E WHICH ULTIMATELY STOOD DELETED FROM THE APPELLATE STAGE. NOW AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVA NT ASSESSMENT YEAR THE LD. ASSESSING OFFICER HAS AGAI N SOUGHT TO REOPEN THE SAID ASSESSMENT U/S.147/148 ON THE REAS ONS INCORPORATED ABOVE. FROM A BARE PERUSAL OF THE REA SONS IT IS SEEN THAT THERE IS NO TANGIBLE MATERIAL WHICH HAS B EEN REFERRED TO OR BROUGHT ON RECORD HAVING LIVE LINK N EXUS WITH THE INCOME ESCAPING ASSESSMENT. THE LD. ASSESSING O FFICER IS ITA NO.59 & 680/DEL/2018 8 TRYING TO REVISIT THE PROFIT AND LOSS ACCOUNT AND A UDIT REPORT WHICH WAS ALREADY THERE ON THE RECORD AND DULY VERI FIED AND SCRUTINIZED DURING THE ORIGINAL ASSESSMENT PROCEEDI NGS WHICH IS EVIDENT FROM THE NARRATION ON EVERY COUNT IN THE REASONS THAT IT WAS NOTICED THAT .. (AS HIGHLIGHTED BY US IN BOLD ABOVE). 8. IN CASES WHERE ASSESSMENT HAS BEEN COMPLETED U/S.143(3) AND SAME IS BEING SOUGHT TO BE REOPENED AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT A SSESSMENT YEAR THE STATUTE PUT FETTERS ON THE POWER OF THE A SSESSING OFFICER IN TERMS OF FIRST PROVISO TO SECTION 147 WHICH PROVIDES THAT WHERE AN ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 143 OR 147 HAS BEEN MADE FOR THE RELEVANT ASSESSMEN T YEAR THEN NO ACTION SHALL BE TAKEN UNDER SECTION 147/148 AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT A SSESSMENT YEAR UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAPE D ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REASON OF TH E FAILURE ON THE PART OF THE ASSESSEE TO MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SEC TION (1) OF SECTION 142 OR SECTION 148; OR TO DISCLOSE FULLY AN D TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT FOR TH AT ASSESSMENT YEAR. THUS THE REOPENING IN THE AFORESA ID CIRCUMSTANCES IS PERMISSIBLE ONLY WHEN FIRSTLY ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT BY THE REA SON OF THE FAILURE ON THE PART OF THE ASSESSEE TO MAKE RET URN; OR SECONDLY FAILURE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR THE ASSESSMENT. IN SO FAR AS THE FIRS T CONDITION ITA NO.59 & 680/DEL/2018 9 IS CONCERN IT IS AN UNDISPUTED FACT AND ALSO ACCEP TED BY THE ASSESSING OFFICER THAT RETURN OF INCOME U/S.139(1) WAS FILED ON 25.09.2009 AND ALSO REVISED RETURN WAS FILED ON 03.03.2013 WHICH IS MENTIONED IN THE ASSESSMENT ORD ER U/S.143(3) AS WELL AS IN REASONS ALSO. IN SO FAR AS SECOND CONDITION IS CONCERNED THAT IS THE FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL F ACTS NECESSARY FOR THE ASSESSMENT SAME HAS NOT BEEN ASC RIBED BY THE ASSESSING OFFICER IN HIS REASONS RECORDED. NOR IS IT SO FROM THE PLAIN READING OF REASONS RECORDED. IF THE ASSES SING OFFICER HAS TO VALIDLY ASSUME JURISDICTION AFTER COMING TO HIS PRIMA FACIE REASON TO BELIEVE THAT INCOME ANY CHARGEABLE TO TA X HAS ESCAPED ASSESSMENT DUE TO FAILURE ON THE PART OF TH E ASSESSEE DISCLOSED FULLY AND TRULY ALL MATERIAL FACTS THEN HE HAS TO DEMONSTRATE SUCH FAILURE IN HIS REASONS AND IT SHOU LD NOT BE MERE BALD STATEMENT. HERE IN THIS CASE THE REASONS ITSELF SPEAKS THAT ALL THE POINTS ON WHICH ASSESSING OFFIC ER HAD SOUGHT TO RAISE IN HIS REASONS RECORDED WERE ALREAD Y DISCLOSED IN THE P&L ACCOUNT OR IN THE AUDIT REPORT AND NOTHI NG HAS BEEN FOUND WHICH WAS NOT DISCLOSED WHICH COULD LEAD TO ANY INFERENCE OF INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. THERE WAS ABSOLUTELY NO FAILURE ON PART OF THE ASSESSEE TO DISCLOSE TRULY AND FULLY ALL MATERIAL F ACTS NECESSARY FOR ASSESSMENT. THE DUTY OF THE ASSESSEE IS TO DISCLOSE ALL THE PRIMARY FACTS NECESSARY FOR THE AS SESSMENT IN HIS RETURN OF INCOME AND IN THE AUDITED FINANCIAL S TATEMENTS. THEREAFTER THE LEGAL INFERENCE HAS TO BE DRAWN BY THE ITA NO.59 & 680/DEL/2018 10 ASSESSING OFFICER. THE PROVISO TO SECTION 147 PUTS EMBARGO OF TIME LIMIT OF FOUR YEARS FROM THE END OF THE RELEVA NT ASSESSMENT YEAR WHERE ASSESSMENTS HAVE BEEN DONE UN DER SECTION 143(3) IF THE TWIN CONDITIONS PROVIDED THE REIN ARE NOT MET. THUS THE SAID PROVISO IS AN EXPLICIT SAFEGUAR D WHICH PROHIBITS THE ASSESSING OFFICER FROM EXERCISING THE POWER TO RE-ASSESS WHERE THE ASSESSMENT HAS ALREADY BEEN COM PLETED U/S. 143(3). IF IS THERE ANY OVER SIGHT OR INADVERT ENT MISTAKE OF THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS WHICH HAS BEEN DISCOVERED BY HIM LATER ON RECONSIDERATION OF SAME MATERIAL THEN IT TANTAMOUN T TO CHANGE OF OPINION MORE SO IN CASES WHERE THE REO PENING IS HIT BY FIRST PROVISO TO SECTION 147 (SUPRA). IN SUCH CASES LAW DOES NOT PERMIT THE ASSESSING OFFICER TO REOPEN A C ONCLUDED ASSESSMENT AFTER EXPIRY OF 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR LIKE IN THE PRESENT CASE. 9. IN THE LATEST JUDGMENT OF HONBLE SUPREME COU RT IN THE CASE OF PCIT VS. L&T LTD. REPORTED IN (2020) 268 TAXMAN 390 THE HONBLE SUPREME COURT WHEREIN THE QUESTION FOR CONSIDERATION WAS; WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE TRIBUNAL WAS CORRECT IN LAW IN HOLDIN G THAT THE NOTICE ISSUE U/S.148 WAS NOT VALID ON THE GROUND TH AT ASSESSING OFFICER HAS NOT DEMONSTRATED THE FAILURE OF THE ASSESSEE IN DISCLOSING THE MATERIAL FACT ? THEIR LORDSHIPS AFTER REPRODUCING THE REASONS RECORDED BY THE ASSESSING O FFICER FOR ISSUING NOTICE U/S.148 OBSERVED AS UNDER: 2. THE APPEAL AS ARISES OUT OF THE JUDGMENT OF THE INCOME TAX ITA NO.59 & 680/DEL/2018 11 APPELLATE TRIBUNAL IN WHICH IT WAS HELD THAT THE NO TICE OF REOPENING WHICH WAS ISSUED BEYOND THE PERIOD OF 4 Y EARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR WAS INVALI D. WE MAY REPRODUCE THE REASONS RECORDED BY THE ASSESSING OFF ICER FOR ISSUING SUCH A NOTICE : '(I) IT WAS SEEN FROM THE RECORDS THAT WHILE COMPUT ING THE DEDUCTION U/S 80-IA CERTAIN PASS THROUGH COMPONENT S LIKE FUEL ADJUSTMENT CHARGES (FAC) ELECTRICITY DUTY WHEELIN G CHARGES GRID SUPPORT CHARGES ETC. HAVE NOT BEEN CONSIDERED FOR ARRIVING AT THE MARKET VALUE OF THE ELECTRICITY. (II) FOR THE PURPOSE OF CLAIMING DEDUCTION U/S 80-I A EXCESS PROFIT FROM THE GENERATION OF ELECTRICITY HAS BEEN SHOWN A S AGAINST '16% RETURN ON INVESTMENT' FIXED BY THE MINISTRY OF POWE R. (III) VARIOUS EXPENSES LIKE INTEREST COMMISSION B ROKERAGE AND CORPORATE OVERHEADS WERE NOT DEBITED TO THE SEPARAT E PROFIT & LOSS A/C. FURTHER SALES AND ADMINISTRATIVE EXPENDI TURE IS NOT PROPORTIONATE TO THE EXPENDITURE DEBITED IN CONSOLI DATED P&L A/C TO THE PROFIT OF 80-IA UNITS WHICH HAS RESULTED IN EXCESS DEDUCTION U/S 80-IA. (IV) THE ASSESSEE CLAIMED DEDUCTION U/S 80-IA 80HH B 80HHBA 80-HHC 80HHE ETC. HOWEVER EXEMPTION CLAIMED U/S 8 0-IA WAS NOT REDUCED FROM OTHER CHAPTER VI-A DEDUCTION AS PE R PROVISIONS CONTAINED IN SECTION 80-IA. (V) DEDUCTION U/S 80-IA WAS WRONGLY CLAIMED IN RESP ECT OF WORK ON CONTRACT BASIS FOR VARIOUS GOVT. AGENCIES WHICH CANNOT BE CONSIDERED AS INFRASTRUCTURE PROVIDER.' 3. PERUSAL OF THE REASONS RECORDED BY THE ASSESSING OFFICER WOULD SHOW THAT THE TRIBUNAL WAS PERFECTLY CORRECT IN COMING TO ITA NO.59 & 680/DEL/2018 12 THE CONCLUSION THAT THE NOTICE OF REOPENING OF ASSE SSMENT WAS INVALID. FROM THE REASONS WE GATHER THAT THERE WAS NO ELEMENT OF LACK OF TRUE AND FULL DISCLOSURE ON THE PART OF THE ASSESSEE WHICH RESULTED INTO ANY INCOME CHARGEABLE TO TAX ESCAPING ASSESSMENT. THE REASONS CLEARLY REVEAL THAT THE ASSESSING OFFIC ER WAS PROCEEDING ON THE MATERIAL WHICH WAS ALREADY ON REC ORD. IN THE ABSENCE OF THE STATUTORY REQUIREMENT OF INCOME CHAR GEABLE TO TAX HAVE BEEN ESCAPED ASSESSMENT DUE TO THE FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE TRULY AND FULLY ALL MATERI AL FACTS BEEN SATISFIED THE TRIBUNAL CORRECTLY HELD THAT THE NOT ICE OF REOPENING OF ASSESSMENT WAS INVALID. NO QUESTION OF LAW ARISE S. 10. THE JUDGMENT OF HONBLE SUPREME COURT IN PRINCI PLE WILL APPLY MUTATIS MUTANDIS ON THE PRESENT REASONS ALSO BECAUSE HERE IN THIS CASE THERE IS NO ELEMENT OF LAW OF TRU E AND FULL DISCLOSURE ON THE PART OF THE ASSESSEE AND THE REAS ONS OF THE ASSESSMENT ORDER WAS BASED ON THE MATERIAL WHICH WA S ALREADY ON RECORD. THUS SUCH A REASON CANNOT CLOTH E THE ASSESSING OFFICER WITH THE JURISDICTION TO COMPLETE THE ASSESSMENT AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. 11. HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF ORACLE INDIA PVT. LTD. VS. ACIT AS REPORTED IN (20 17) 397 ITR 480 (DEL) HELD THAT WHERE AUDITED ACCOUNTS WERE ALREADY AVAILABLE WITH THE ASSESSING OFFICER AND FORM PART OF THE ASSESSMENT RECORD THEN MERELY SUGGESTING THAT THER E WAS FAILURE ON THE PART OF THE ASSESSEE TO COMPUTE AND DECLARE THE TRUE TAXABLE INCOME WITHOUT FURTHER CLARIFICATION W OULD NOT ITA NO.59 & 680/DEL/2018 13 JUSTIFY REOPENING OF THE ASSESSMENT AFTER THE LIMITA TION PERIOD OF FOUR YEARS. 12. THUS WE HOLD THAT THE RE-ASSESSMENT PROCEEDING INITIATED VIDE NOTICE DATED 23.03.2016 IS BAD IN LA W AND VOID AB INITIO AND CONSEQUENTLY THE ENTIRE ASSESSMENT IS QUASHED. SINCE WE HAVE ALREADY QUASHED THE RE-ASSESSMENT PROCEEDINGS ALL OTHER ISSUES RAISED ON MERITS BY T HE REVENUE AS WELL AS BY THE ASSESSEE HAVE BECOME INFRUCTUOUS. 13. IN THE RESULT THE APPEAL OF THE ASSESSEE IS AL LOWED AND REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH MAY 2021. SD/- SD/- [ANIL CHATURVEDI] [AMIT SHUKLA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 17 TH MAY 2021 PKK