If AO has examined the issue of loss arising out of fluctuation in foreign exchange, then reassessment cannot be initiated

Hidelbergcement India Ltd Vs ACIT (ITAT Mumbai) – Once the Assessing Officer considered and examined the issue of foreign exchange fluctuation as manifest from the original assessment order, the assessment completed u/s 143(3) cannot be reopened on the same issue by taking a different view. The Hon’ble Supreme Court in the case of Kelvinator India Ltd (supra) has held that concept of change of opinion has not been obliterator by virtue of amendment of sec 147 of the I T Act.

THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI
ITA No. 2336/MUM/2010
(Asst Year 2004-05)

ORDER

Explore the verdict in Hidelbergcement India Ltd Vs ACIT (ITAT Mumbai) on reassessment validity and foreign exchange gain dispute. Legal insights here.

1. This appeal filed by the assessee is directed against the order dated 2.2.2010 of the CIT(A) arising from the order relating to AY 2004-05.

2  The assessee has raised the following effective grounds in its appeal:

i) The ld CIT(A) has erred in confirming the reopening of the assessment proceedings u/s 147 of the act, as valid through there was additional material which was not disclosed in the original scrutiny proceedings for the year under consideration.

ii) The ld CIT(A) has erred in confirming the reopening of the assessment proceedings through the original order made u/s 143(3) of the Act contained the detailed note ofthe allowance ofthe said fluctuation.

Iii The ld Cit(A) has erred in confirming the additions of Rs. 99,78,719/- towards foreign exchange gain which is nothing but the notional gain accounted for in terms of Accounting Standard 11 issued by the Institute of Chartered Accountants of India.

iv) The ld CIT(A) has erred in confirming the additions of Rs. 99,78,719/- based upon the decision in the case of Woodward Governor India Pvt Ltd as reported in 312 ITR 254 without correlating the facts of the case to the case of the appellant.”