PRINCIPAL COMMISSIONER OF INCOME TAX, DELHI-2, vs. BHARTI AIRTEL LTD.(FORMERLY BHARTI CELLULAR LTD)

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ITA/919/2017HC DelhiDLHC01263867201731 October 2017Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MR. JUSTICE SANJEEV SACHDEVA2 pages
AI SummaryDismissed

What did the High Court hold?

The ITAT's order setting aside the reassessment was upheld. The High Court found that reopening a concluded assessment based on mere re-appreciation of existing material, without new tangible evidence, was not permissible.

What were the facts?

The assessee's return for AY 2002-2003 was assessed, including software expenses treated as administrative expenditure. The assessment was later reopened under Section 147/148, which the CIT(A) and ITAT found to be a change of opinion without fresh material.

What were the issues?

Whether reopening a concluded assessment under Section 147/148 is permissible without fresh tangible material, amounting to a change of opinion.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 153

AI-generated summary — verify with the full judgment below

ITA 919/2017 Page 1

$~20 * IN THE HIGH COURT OF DELHI AT NEW DELHI +

ITA 919/2017, CM APPL.39108-39110/2017

PRINCIPAL COMMISSIONER OF INCOME TAX, DELHI-2 ..... Appellant Through: Mr. Rahul Kaushik, Sr. Standing Counsel.

versus

BHARTI AIRTEL LTD.(FORMERLY BHARTI CELLULAR LTD) ..... Respondent Through: Ms. Kavita Jha with Ms. Shivani Khandekar, Advocates.

CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE SANJEEV SACHDEVA

O R D E R %

31.10.2017

1.

The Revenue is aggrieved by the order of the ITAT which set aside the re-assessment order made by the Assessing Officer. 2. The facts are that the assessee filed the return for AY 2002- 2003. This was assessed under the normal provisions of the Income Tax and at book profit of `1,05,53,29,112 under Section 115JB through an order finalized under Section 153 (3). This was after the Assessing Officer considered the claim by the assessee to treat software expenses to the tune of `5.44 crores as administrative and other expenditure. The assessment was sought to be reopened and finalized under Section 147/148. The CIT (A) held that the

ITA 919/2017 Page 2

reassessment concluded was contrary to the provisions of Section 147/148 as it amounted to change of opinion. The ITAT affirmed that finding. 3. The Revenue urges that on the merits the issue of treatment of such software expenses as revenue expenditure is pending before this Court under Section 260A for the previous years. 4. This Court is of the opinion that the ITAT’s impugned order is unexceptionable because it is premised upon the circumstance that in the absence of any fresh tangible material, it was not open, on mere re-appreciation of the existing circumstances, to reopen the concluded scrutiny assessment. The ITAT’s reasoning cannot, therefore, be faulted. No question of law arises. The appeal is, therefore, dismissed.

S. RAVINDRA BHAT, J

SANJEEV SACHDEVA, J OCTOBER 31, 2017 /vikas/

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