CIT vs. PRAVEEN INDUSTRIES PVT LTD

IN THE HIGH COURT OF DELHI AT NEW DELHI . 13.12.2010 . Present: Ms.Sonia Mathur, Advocate for the Appellant. Mr. Prakash Kr., Advocate for the Respondent. . + ITA No.1956/2010. . . . The return for the relevant accounting year was filed at an income of Rs.1,70,42,783/- on 31.10.2001. The same was processed and assessment was framed under Section 142(3) on 24.03.2003 at an income of Rs.1,80,80,973/-. The case was reopened under Section 147 read with Section 148 of the Act on 27.03.2008. Recording revealed that the assessee had claimed deduction under Section 80HHC on the amount of profits of Rs.17,11,322/- allowed as deduction under Section 80-1A of the Act, which is not allowable as per provisions of Section 80-1A(9). Thus there was excess deduction of Rs.7,56,140/- under Section 80HHC. It was further noted by the AO that while computing deduction under Section 80-1A, assessee had not reduced the amount of duty drawback and DEPB receipts. The appeal of the assessee, however, was allowed by the CIT(A) and the CIT(A) held that the notice under Section 148 for reopening of the proceedings was invalid and on this basis, reassessment proceedings was quashed. This order of the CIT(A) is upheld by the ITAT, inter alia, recorded as under:- :2: ?4.2 A reading of the above makes it clear that the reopening has been done only on the basis of facts which are already on record and submitted by the assessee. The assessee had clearly given the details of deduction u/s 80 HHC and u/s 80 IA and u/s 80 IA which was being claimed. Hence, it is clear that there was no failure on the part of the assessee to disclose all the materials. Hence in the above situations reassessment cannot be said to permissible. This view draws support from Hon?ble Jurisdictional High Court decision in the case of Wel Intertrade P Ltd. and another (formerly Wel Intertrade Ltd.) vs. ITO reported in 308 ITR and JSRS Udyog Ltd and Another vs. ITO reported in 313 ITR 321. 5. In the background of aforesaid discussion and precedent, in our considered opinion the reopening under Section 147 is not justified. Hence, we confirm the ld. CIT (A)s order quashing the assessment on the ground of lack of jurisdiction itself.? . It is clear from the above that the case was reopened after the expiry of four years of the passing of the assessment orders. On the other hand, it is found that there was no concealment of any particular on the part of the assessee, but it had made full disclosure of all the relevant materials touching upon this issue. In these circumstances, we are of the opinion that the Tribunal has rightly held that notice under Section 147/148 of the Income Tax Act issued by the Assessing Officer was beyond the prescribed period of limitation and was thus invalid. No question of law arises. Dismissed. A.K. SIKRI, J. . SURESH KAIT, J. DECEMBER 13, 2010/hk . . #128