Case Law Details
Prasad Koch Technik Tech Pvt Ltd Vs. Versus ACIT (Ahmedabad High Court)-
The Assessing Officer supplied reasons he had recorded for reopening the assessment, which read as under:- “The assessee company filed its return of income on 22.12.2006, declaring total income of Rs. 1,00,86,370/-. The assessment u/s. 143(3) was finalised on 18.06.2008 determining the taxable income of Rs. 1,00,86,370/-. It is seen that the assessee company had made payment of Rs. 21,60,399/- in Foreign Company for purchase of raw materials. However, neither did the company deduct TDS on this amount nor any certificate obtain from the concerned Assessing Officer for non-deduction of TDS.
Thus, in view of the provisions of section 40a (i) and judgement of Karnataka High Court, entire amount was required to be disallowed and added back to the total income. As discussed above, the disallow expenditure of Rs. 21,60,399/- resulted in under assessment of same income. In view of the facts discussed above, I have reason to believe that income of Rs. 21,60,399/- being the amount of dis allowable u/s. 40a (i) chargeable to tax has escaped assessment for A.Y. 2006-07 and accordingly it is the fit case for reopening the assessment u/s. 147 for the A.Y. 2006-07.”
12. Having thus heard learned counsel for the parties and having perused the documents on record, we notice that the assessments previously framed are sought to be reopened within period of 4 years from the end of the relevant assessment year. We also notice that admittedly in the assessment originally framed, the Assessing Officer had not decided the issue of requirement of the petitioner deducting the tax at source on its payments for purchase of raw-materials to foreign supplier. In that view of the matter, it cannot be stated that the Assessing Officer had formed any opinion in the original assessment or that reopening would amount to permitting the Assessing Officer to change his opinion.
13. However, as held by the Apex Court in the case of Commissioner of Income-Tax vs. Kelvinator of India Ltd. reported in [2010] 320 ITR 561(SC), even after the amendment in Section 147 of the Act with effect from 1.4.1989, the basic requirement for reopening the assessment that the Assessing Officer has to have reason to believe that the income chargeable to tax has escaped assessment, would continue to apply. In that view of the matter, we would have to ascertain whether from the reasons recorded by the Assessing Officer for reopening the assessments, there is any such belief emerging.
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