Case Law Details
Hitech Outsourcing Services Vs CIT (Gujarat High Court)
We have noticed that the Assessing Officer in teh original assessment proceedings had examined the assessee’s claim of deduction under section 10B of the Act. It is not as if such claim went unnoticed or unscrutinized. He wanted to be specific about the assessee’s claim for deduction and therefore, he raised queries in respect to the same in response to which the assessee, as noted, placed number of documents and materials on record. Principally, the assessee pointed out that it has been granted certification by STPI under the Software Technology Parks Scheme. The assessee also supported the claim on merits pointing out that the Development Commissioner had granted certificate of commencement and that foreign exchange remittances were made within six months from the end of the financial year. After such scrutiny, the Assessing Officer passed the original order of assessment in which he did not reject the claim of deduction under section 10B of the Act. In fact, he accepted the claim substantially making minor disallowance to the extent the assessee had not received foreign exchange payment within the prescribed period.
It can thus be seen that the assessee’s claim of deduction under section 10B of the Act was examined minutely by the Assessing Officer. The assessee pointed out that it enjoyed certification under STPI. If the Assessing Officer was of the opinion that such certification was inadequate and did not substitute for the requirement of approval by the Board appointed by the Government of India, under the Industries (Development and Regulation) Act, 1961, it was always open for the Assessing Officer to examine this issue further or to reject the assessee’s claim in its entirety. He however, accepted the claim accepting the assessee’s certification as sufficient compliance with the statutory requirements. There was no failure on part of the assessee to disclose necessary facts. Both on the ground of the non failure of assessee to disclose necessary facts and on the ground of scrutiny during original assessment proceedings, notice of reopening on this issue was not permissible. The Assessing Officer as well as the Commissioner both failed to appreciate this legal lacuna in the notice of reopening.
It would now, therefore, not be open for the Assessing Officer to reopen such assessment on the principal claim of the petitioner for deduction on the ground that some other elements or aspects of the claim were not examined. This would clearly be a case of change of opinion.
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
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