$~25
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 28.11.2017
+ ITA 1060/2017 & CM No. 42859-60/2017
PR COMMISSIONER OF INCOME TAX, DELHI-2 ..... Appellant
versus
M/S. CHL LIMITED ..... Respondent
Advocates who appeared in this case:
For the Appellant(s) : Mr. Zoheb Hossain, Sr. Standing Counsel
.
For the Respondent(s) : None.
CORAM:-
HON'BLE MR. JUSTICE S. RAVINDRA BHAT
HON'BLE MR. JUSTICE SANJEEV SACHDEVA
S. RAVINDRA BHAT, J. (OPEN COURT)
1. The Revenue claims to be aggrieved by the order of the Income
Tax Tribunal (ITAT) which has set aside the assessment framed. It
contends that the reasoning with respect to untenability of re-
assessment for the Assessment Year (AY) 2000-01, in the facts of this
case, was not justified.
2. The assessee had filed its returns for the AY 2000-01 claiming
certain income to be part of its returns had arisen under Section
80HHb. The assessment was completed under Section 143(3).
ITA 1060/2017 Page 1 of 4
Subsequently, much later i.e. on 21.03.2007, the Revenue exercised
its powers under Section 147/148, recorded the following reasons:-
"10. As regards assessment year 2000-01, Ld. Counsel
submitted that for assessment year under consideration,
reopening has been initiated beyond 4 years and the
assessing officer has also alleged that assessee has failed
to disclose fully and truly all material facts necessary for
assessment. The reasons recorded have been placed at
page 33 of paper book which reads as under:
The assessment in the case of M/s CHL Ltd., for the A. Y.
2000-01 was completed in March, 2003 determining the
income at Rs. 1,04,56,040/-. On perusal of the records it
is noticed that the assessee has claimed deduction u/s
80HHD amounting to Rs. 2191238/- which was allowed
at the time of assessment completed u/s 143(3). It is seen
that in the profit of the business commutated for the
purpose of deduction u/s 80HHD, the interest income of
Rs.6,54,23,22/- and license fee of Rs. 5,69,49,782/- were
not reduced, which were required as per the provision of
Section 80HHD as these receipts had direct nexus with
business activities of the assessee i.e. running of the
Hotel. After reducing the above mentioned receipts, the
profits of the business of the assessee for the computation
of deduction u/s 80HHD comes to negative finger and
hence no deduction u/s 80HHD can be allowed to the
assessee.
The assessee at the time of filing the return of income
during the assessment proceedings failed to disclosed
fully and truly all material facts necessary for completion
of the assessment for the assessment year 2000-01. I,
therefore, have reasons to believe that this amount of
Rs.21,91,238/- represents income of the assessee
chargeable to tax which has escaped assessment for the
assessment year 2000-01."
ITA 1060/2017 Page 2 of 4
3. The additions made by the Assessing Officer were appealed
against by the assessee. The CIT(A) confirmed the additions holding
that the amounts brought to tax could not have been legitimately
claimed as deduction under Section 80HHb. Upon further appeal, the
ITAT allowed the assessee's contentions. The ITAT has reasoned that
the AO's opinion, with respect to assessee's failure with respect to all
material facts revealed, amounted to change of the opinion and that in
the absence of any fresh material; the circumstances that for the
previous assessment year (i.e. AY 1998-99) the additions made by the
AO were accepted, could not stand. The ITAT's reasoning is as
follows: -
"In the present case, as noted above, Assessing Officer
was having before him all material facts that were
necessary for the purposes of completing original
assessment. The Assessing Officer's recording that the
assessee has failed to disclose all material facts
necessary for completion of assessment without pointing
out as to what was the material that was not disclosed. It
is a bland statement which remains unsustainable. The
reassessment was not passed on only fresh material. The
material on record was only examined and used for
recording reasons for reopening. The reopening was
merely a change of opinion on the same set of facts and
material. No fresh material came in to the possession of
the Assessing Officer warranting reopening. Hence the
reopening is bad in law. We, therefore, set aside and
quash the notice u/s 148 and assessment order for A.Y.
2000-01. We, therefore, do not find any necessity to dwell
upon the merits of the case.
Accordingly, appeal filed by the assessee stands allowed
for A. Y 2000-01."
ITA 1060/2017 Page 3 of 4
4. This Court is of the opinion that the conclusion recorded by the
ITAT does not call any interference. The regular assessment was
completed, in this case, on 31.03.2003. The regular assessment for
AY 1998-99 was completed on 27.03.2001. In these circumstances,
the assessee could not be faulted for having accepted the additions
made for the previous assessment year (AY 1998-99); though later,
given that the returns were filed on 29.11.2000 for the assessment
year (AY 2000-01) in the present case.
5. No substantial question of law arises. The appeal is dismissed.
S. RAVINDRA BHAT
(JUDGE)
SANJEEV SACHDEVA
(JUDGE)
NOVEMBER 28, 2017
`rs'
ITA 1060/2017 Page 4 of 4
|