THE ITO, WARD-4, ANAND vs. THE VALLABH VIDHYANAGAR COMMERCIAL CO.OP. BANK LTD., ANAND

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ITA 2810/AHD/2014Status: DisposedITAT Ahmedabad09 October 2017AY 2007-084 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that reopening the assessment based on a mere change of opinion by the AO on an issue already examined in the original assessment is not permissible. The CIT(A) was correct in quashing the reassessment proceedings.

What were the facts?

The Assessing Officer (AO) reopened the assessment of the assessee for AY 2007-08 after a scrutiny assessment was already completed. The AO made an addition towards interest income from non-performing assets. The CIT(A) quashed the reassessment proceedings, finding that the issue was already examined in the original assessment.

What were the issues?

Whether reassessment proceedings under Section 147 are valid when the issue was already examined and decided in the original assessment under Section 143(3) and the reopening is based on a change of opinion.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148,Section 142(1),Section 80P

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, “ B ” BENCH, AHMEDABAD

Before: SHRI PRADIP KUMAR KEDIA & SHRI MAHAVIR PRASAD

For Respondent: Shri D.K. Parikh, AR

आदेश / O R D E R

PER PRADIP KUMAR KEDIA - AM: The captioned appeal filed at the instance of the Assessing Officer (AO) against the order of the Commissioner of Income Tax(Appeals)- IV, Baroda [CIT(A) in short] dated 28/07/2014 in the matter of assessment order under s.143(3) r.w.s. 147 of the Income Tax Act, 1961

ITA No.2810/Ahd/2014 ITO vs. The Vallabh Vidhyanagar Comm.Co-op.Bank Ltd. Asst.Year –2007-08 - 2 - (hereinafter referred to as "the Act") dated 18/03/2014 related to Assessment Year (AY) 2007-08.

2.

The grounds of appeal raised by the Revenue read as under:- 1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in holding that the reassessment u/s.143(3) r.w.s.147 of the I.T.Act is not valid without appreciating the fact that the A.O. had rightly issued notice u/s.148 of the Act.

2.

“On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in not appreciating the fact that Hon’ble Karnataka High Court in the case of C.I.T. vs. Rinku Chakraborthy, 242 CTR has held that where in the original assessment, income liable to tax has escaped assessment due to oversight and inadvertence or a mistake is committed by the A.O., the A.O. has the jurisdiction to reopen the original assessment. This has been endorsed by the Hon’ble Delhi High Court in the case of Dalmia P.Ltd. vs. C.I.T.(Delhi HC) vide order dated 28/09/2011, holding that despite specific and pointed queries in section 143(3) assessment, A.O. cannot be said to have formed any opinions, if explicit opinion is not recorded.”

3.

With the assistance of the Ld.Representaives on behalf of the assessee and the Revenue, we find that the assessee had originally filed its return of income on 29/10/2007. The aforesaid return was subjected to scrutiny assessment under s.143(3) of the Act on 15/12/2009. Thereafter, a notice under s.148 dated 06/11/2012 was issued and the assessment completed under s.143(3) earlier was once again reopened for assessment. In the reassessment order under s.143(3) r.w.s.147 of the Act, the AO made an addition towards interest income received during

ITA No.2810/Ahd/2014 ITO vs. The Vallabh Vidhyanagar Comm.Co-op.Bank Ltd. Asst.Year –2007-08 - 3 - accounting year 2006-07 towards non-performing assets (NPA). In the first appeal against the aforesaid action of the AO, the CIT(A) quashed the reassessment proceedings initiated under s.147 rws 148 of the Act as without jurisdiction. It was found by the CIT(A) that the identical point was duly examined by the AO in the original assessment proceedings and therefore the reassessment on the same issue cannot be carried out merely on the basis of revised opinion or change of opinion on the same very issue. As pointed out on behalf of the assessee, we find that the assessee had duly disclosed the relevant facts as per a suitable note on the bottom of the computation of income. We also observe that specific question of deduction claimed under s.80P of the Act towards the aforesaid amount of Rs.82,33,739/- was raised in the notice issued by the AO under s.142(1) dated 04/03/2009 in the original assessment proceedings. We also take note of the reply of the assessee thereto for entitlements of deduction under s.80P of the Act dated 20/11/2009. Thus, it is apparent that the AO in the original assessment proceedings had taken a conscious view on the eligibility of claim of aforesaid deduction. Therefore, the CIT(A), in our view, has rightly relied upon the judgements in the case of National Dairy Development Board 356 ITR 413 (Guj.) and of CIT vs. Kelvinator of India 320 ITR 561 (SC). In the terms of aforesaid decisions and as per long line of judicial precedents consistently holding that a mere change of opinion on the part of AO on the issue examined earlier does not grant jurisdiction to reopen the completed assessment

ITA No.2810/Ahd/2014 ITO vs. The Vallabh Vidhyanagar Comm.Co-op.Bank Ltd. Asst.Year –2007-08 - 4 - proceedings under s.147 of the Act, we find no infirmity in the order of the CIT(A) while quashing the reassessment proceedings. Consequently, we find no merit in the appeal of the Revenue.

In the result, appeal of the Revenue is dismissed. 4. This Order pronounced in Open Court on 09 / 10 /2017

Sd/- Sd/- (महावीर �साद) (�द�प कुमार के�डया) �या�यक सद�य लेखा सद�य ( PRADIP KUMAR KEDIA ) ( MAHAVIR PRASAD ) JUDICIAL MEMBER ACCOUNTANT MEMBER

Ahmedabad; Dated 09/ 10 /2017

ट�.सी.नायर, व.�न.स./T.C. NAIR, Sr. PS आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)-IV, Baroda �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, स�या�पत ��त //True Copy//

उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad

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