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Income Tax Appellate Tribunal, “D” Bench, Mumbai
Before: Shri B.R. Baskaran (AM) & Shri Ravish Sood(JM)
O R D E R Per B.R. Baskaran (AM) :-
The appeal filed by the assessee is directed against the order dated 30- 01-2014 passed by Ld CIT(A)-38, Mumbai and it relates to the assessment year 2008-09. The assessee is challenging the validity of reopening of assessment and also denial of set off of brought forward loss pertaining to AY 2006-07.
The assessment in the hands of the assessee for AY 2008-09 was completed u/s 143(3) of the Act on 30-12-2010 by granting set off of brought forward loss of assessment year 2006-07. Later the AO noticed that the brought forward loss pertaining to assessment year 2006-07 could be set off as per the provisions of sec.80 of the Act, since the assessee had filed return of income of AY 2006-07 beyond the due date prescribed u/s 139(1) of the Act. He also noticed that this fact was specifically mentioned in the assessment order passed for AY 2006-07. Hence the AO took the view that there was underassessment of the income of the year under consideration. Accordingly he reopened the assessment by 2 Kores International P. Ltd.
issuing notice u/s 148 of the Act on 07-06-2011 in order to disallow the claim of set off of brought forward loss pertaining to AY 2006-07 and accordingly completed the assessment. The Ld CIT(A) also confirmed the same.
The assessee has challenged the validity of reopening of assessment for the first time before the Tribunal. The Ld A.R submitted that the assessing officer has not brought on record any new tangible material and he has only re- appreciated the material already available on record. He submitted that the assessing officer has accepted the claim of set off of brought forward loss in the original assessment proceeding and he has reopened the assessment on change of opinion.
On the contrary, the Ld D.R submitted that the AO has reopened the assessment to apply correct provisions of law and it cannot be a case of change of opinion.
We have heard rival contentions on this issue. The assessment has been reopened within four years from the end of the assessment year under consideration. As submitted Ld D.R, we notice that the AO has reopened the assessment only to apply correct provisions of law. The question of forming an opinion on legal provisions shall not arise when the provisions of very clear and hence the question of change of opinion also does not arise in this case. In our view, the existence of new material also not required for applying correct provisions of law. It is well settled proposition that there is no estoppel against law. Accordingly we do not find merit in any of the contentions urged by the assessee. Accordingly we uphold the validity of reopening of assessment.
On merits, we notice that the tax authorities have applied the correct provisions of law (sec. 139(3) r.w.s. 80), which debars carry forward and set off
3 Kores International P. Ltd. losses if the return of income is not filed within the period prescribed u/s 139(3) r.w.s. 139(1) of the Act. Since the return of income of AY 2006-07 has not been filed within the period prescribed u/s 139(3) r.w.s. 139(1) of the Act, the question of allowing set off of the loss of that year does not arise. Accordingly we uphold the order passed by Ld CIT(A) on this issue also.
In the result, the appeal filed by the assessee is dismissed. Order has been pronounced in the Court on 3.1.2017.