Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: Central Excise rule to resale the machines to a new company :: cpt :: list of goods taxed at 4% :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT Audit :: ACCOUNTING STANDARD :: due date for vat payment :: articles on VAT and GST in India :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: VAT RATES :: ACCOUNTING STANDARDS :: ARTICLES ON INPUT TAX CREDIT IN VAT :: empanelment
 
 
From the Courts »
  Micro Spacematrix Solution P Ltd vs. ITO (ITAT Delhi)
 Micro Spacematrix Solution P Ltd vs. ITO (ITAT Delhi)
 CIT vs. Greenfield Hotels & Estates Pvt. Ltd (Bombay High Court)
 IndiaBulls Financial Services Ltd vs. DCIT (Delhi High Court)
 Maharao Bhim Singh of Kota vs. CIT (Supreme Court)
 Ravneet Takhar Vs. Commissioner Of Income Tax Ix And Ors.
 Jaiprakash Associates Ltd. Vs. Commissioner Of Income Tax
 Formula One World Championship Limited Vs. Commissioner Of Income Tax, International Taxation-3 And Anr.
 Commissioner Of Income Tax International Taxation-3 Delhi Vs. Formula One World Championship Ltd. And Anr.
 Reliance Communications Ltd vs. DDIT (ITAT Mumbai)
  Sushila Devi vs. CIT (Delhi High Court)

M/s. Chroma Print,C/o.Shri T.N.Seetharaman,Advocate 384 (old No.196) Lloyds Road,Chennai-600 086. Vs. The Assistant Commissioner of Income Tax, Circle-II Race Course Road,Coimbatore.
June, 29th 2012
            IN THE INCOME TAX APPELLATE TRIBUNAL
                      `C' BENCH, CHENNAI

         BEFORE Dr. O.K. NARAYANAN, VICE PRESIDENT AND
              SHRI V.DURGA RAO, JUDICIAL MEMBER

                         ITA No.366/Mds/2012
                       (Assessment Year: 2005-06)


M/s. Chroma Print,                          The Assistant Commissioner   of
C/o.Shri T.N.Seetharaman,Advocate           Income Tax, Circle-II
384 (old No.196) Lloyds Road,         Vs.   Race Course Road,
Chennai-600 086.                            Coimbatore.
PAN:AAEFC1527C
    (Appellant)                                         (Respondent)

                  Appellant by     : Mr. R.Kumar, Advocate
                Respondent by      : Mr. Vikramaditya, JCIT

                 Date of Hearing    : 22nd May, 2012
         Date of Pronouncement      : 27th June, 2012




                              ORDER

    PER V.DURGA RAO, JUDICIAL MEMBER:

          This appeal by the assessee             is directed against

    the order of CIT(A)-I,          Coimbatore dated 13.12.2011

    relevant to the assessment year 2005-06.

    2.    The facts in brief are that the assessee had filed its

    return of income for the year under consideration

    declaring total income of `90,99,303/-. The assessment

    was completed under section 143(3) on 21.08.2007.

    Subsequently, the case was reopened and a notice
                            2          ITA No.366/Mds/2012


under section 148 was issued on 4.3.2010 and respond

to the notice assessee had filed return of income on 28th

May, 2010. Thereafter Assessing Officer had issued

notice under section 143(3) to the assessee. During the

course of the reassessment proceedings, the Assessing

Officer has observed that it is seen from the profit and

loss account for the year ending 31.3.2005, the

assessee had debited an amount of `24,04,453/- being

software expenses. The assessee had purchased a

software viz. "LIC PRINECT SIGNA STATION 74"from

Hiedlberg, Germany vide invoice no.1803015627 dated

15th December, 2004 through order no.1073009. From

the above details, the Assessing Officer has observed

that the assessee has purchased a new software and it

does not come under upgradation or for renewal of the

existing software. As per the provisions of section 32 of

the Act, computer includes software purchased and is

eligible for depreciation @ 60%. As per section 32(1)(ii),

the assessee owns licence to utilize the software for the

purpose   of   business.   Manufacturing    concern     i.e.
                            3          ITA No.366/Mds/2012


Heidelberg, Germany holds patent but the right of

possession and usage was transferred to assessee by

Heidelberg, Germany through the form of licence which

is an asset. Moreover, the core software design is same

to be utilized for several years. The original software

itself is a capital asset and the expenses incurred were

capital expenditure. Since the purchase of software

made from Heidelberg, Germany         is new software, it

cannot be allowed as revenue expenditure. Accordingly,

the Assessing Officer has made addition. The assessee

carried the matter in appeal before CIT(A). Before the

CIT(A), the contention of the assessee was that the

reopening was beyond four years and the original

assessment was completed under section 143(3) by

considering   the   same   material   and   therefore,       it

amounts to change of opinion and therefore, reopening

was bad in law.      The CIT(A) after considering the

explanation of the assessee observed that the assessee

nowhere objected to issue notice under section 148 nor

questioned the same before Assessing Officer. The only
                            4         ITA No.366/Mds/2012


objection of the assessee before the Assessing Officer

was to pass a speaking order. The CIT(A) further

observed that only during the course of assessment

proceedings, that too in the month of December, a letter

dated 27th December, 2010         was filed before the

Assessing Officer where it is stated that proposed

reassessment under section 148 is not legally correct.

The CIT(A) with that observation without deciding legal

issue before him proceeded to decide the matter on

merits and confirmed the addition made by the

Assessing Officer. On being aggrieved, assessee carried

the matter in second appeal before the Tribunal.

3.   At the time of hearing, counsel for the assessee

submitted that reopening was bad in law as it was done

beyond four years and in the original assessment

proceedings under section 143(3) the same material

was considered and thus it amounts to change of

opinion. He relied on the decision of a Third Member in

the case of ACIT Vs. Rolta India Ltd., reported in (2011)

132 ITD 98(Mum)(TM).
                             5           ITA No.366/Mds/2012





4.    On    the     other   hand,    the      Departmental

Representative supported the order of the CIT(A).

5.    We have heard both parties and perused the

records.    The issue before us for consideration is

whether    the    reassessment   order     passed    by   the

Assessing Officer by issuing notice under section 148 is

valid or not? In this context, the observation of the

CIT(A) vide para 5 of his order is reproduced as under:-

      "5. I have gone through the information
     furnished by the appellant and also the order
     of the Assessing Officer. As seen from details,
     in the letter filed on 27.12.2010 in one para,
     the appellant submitted a case law ALA Firm
     Vs. CIT 189 ITR 285, where the Supreme
     Court held that reassessment cannot be
     based on bare or mere change of opinion. The
     appellant nowhere objected to the issue of
     notice u/s.148 nor questioned the same. Even
     during the course of initiation of proceedings
     u/s.148, the appellant has not raised any
     objection before the Assessing Officer to pass
     a speaking order. It was only during the
     course of assessment proceedings, that too in
     the month of December, a letter dated
     27.12.2010 was filed before the Assessing
     Officer where it stated that the proposed
     reassessment u/s.148 is not legally correct."

6.    From the above order, we find that the CIT(A)

without deciding the issue in its right perspective by
                                  6             ITA No.366/Mds/2012


simply saying that objection of the assessee was raised

before the Assessing Officer only                 by letter dated

27.12.2010 which is not valid in law. In our opinion,

CIT(A) has not considered the issue properly. We

therefore, set aside the impugned order and remit the

matter back to the CIT(A) to decide the matter afresh

by considering the case laws relied on by the assessee

and after giving reasonable opportunity of hearing to

the assessee.

7.     In the result, the appeal filed by the assessee is

allowed for statistical purposes.

Order pronounced in the open court on   Wednesday , the 27th of   June,

2012 at Chennai.



             Sd/-                                       Sd/-
 ( Dr. O.K.Narayanan )                           ( V.Durga Rao )
     Vice President                              Judicial Member

Chennai,
Dated the 27th June, 2012.

somu


Copy to:     (1) Appellant    (2) Respondent      (3) CIT
              (4) CIT(A)       (5) D.R.           (6) G.F.
 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Our Mission

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions