Apex Court has observed in Ajantha Industries (supra) is that while transferring the case on the ground of co-ordinated investigation, some reason has to be given by the commissioner which reveals why it is necessary to transfer the case for the purpose of co-ordinated investigation. In our view unfortunately Commissioner of Income Tax apart from stating that case has been transferred for co-ordinating investigation has not given any other reason. Impugned order is therefore quashed and set aside.
The other ground on which the CLB interfered with the decision at the board meeting held on 31-10-2012 was that the notices of the board meeting were issued at a time when the Respondent was not in the country and was stuck in New Jersey, USA, which was admittedly hit by a hurricane. While the notice was properly delivered to the Respondent, its request for adjournment of the meeting could have been easily accommodated by the Appellants. Nevertheless, they went ahead and held the meeting. This has been sought to be remedied by the impugned order of the CLB by directing that a fresh board meeting be convened. In the facts and circumstances, the CLB was justified in issuing the said direction. What however cannot be sustained in law is the direction that in the fresh board meeting, effect must be given to clause 6.2 of the JVA. That portion of the impugned order is, therefore, set aside.
Though the Assessing Officer invoked penalty under Section 27(1)(c) of the Act and stated that the assessee failed to furnish complete details from bank statement, on going through the materials placed before this Court, it is seen that the Assessing Officer has subsequently found that the said deposit was made for the period commencing from 01.04.2004 to 29.03.2005.
For these reasons, we have come to the conclusion that the Petitions would have to be allowed. We accordingly allow the Petitions by quashing and setting aside the notices under section 148 of the Income-tax Act, 1961 purporting to re-open the assessment for A.Ys. 2005-06, 2006-07, 2007-08 and 2008-09. Rule is made absolute in the aforesaid terms. There shall be no order as to costs.
The case of the revenue is that the respondent assessee is not entitled to concessional rate of tax provided in Article 12 of DTAA on the ground that it is not the beneficial owner of the musical tracks in respect of which the royalty income was earned. Thus, not entitled to concessional rate of tax at 10% under DTAA as held by the Assessing officer.
Commissioner of Income Tax (Appeals) as well as Tribunal both were satisfied with regard to identify and creditworthiness of the donors and genuineness of the gifts. Learned Tribunal also satisfied that there is no room to doubt about love and affection of the donors with the assessee as donors were brothers of the assessee. Therefore, gifts could have been given without any occasion and only for the love and affection with the assessee.
With regard to the amendment to section 2(14), which has been brought about by the Finance Act, 2007 w.e.f. 1.4.2008 and which alters the clause pertaining to ‘personal effects’ in the manner indicated below, we may say straightaway that the same would not apply as it has prospective operation with effect from 01.04.2008, whereas in the present case the assessment year is 2002-03.
We are of the considered opinion that in fact the issue sought to be raised by the appellant-Revenue is already answered by Hon’ble Supreme Court in the case of Samtel India Ltd. (supra) and, therefore, in this appeal no question of law arises including with respect to the other two issues. The objection of the Revenue that in this very proceeding refund could not have been ordered or the claim of the assessee became barred by time, we are of the considered opinion that when the order with respect to disallowance itself had not become the final, before that the claim of refund could not have been raised by the assessee.
It is not in dispute that under the Companies Act, 1956, both straight line method and written down value method are recognised. Therefore, once the amount of depreciation actually debited to the profit and loss account is certified by the auditors, then, as per the decision of the apex court in the case of Apollo Tyres Ltd. The Assessing Officer thereafter has the limited power of making increases and reductions as provided for in the Explanation to the said section. To put it differently, the Assessing Officer does not have the jurisdiction to go behind the net profit shown in the profit and loss account except to the extent provided in the Explanation to Section 115-J.
Unless the Assessing Officer assesses the income with reference to which he had formed a reason to believe within the meaning of Section 147 of the Act, it would not be open to him reassess or assess any other income chargeable to tax which has escaped assessment and comes to his notice in reassessment proceedings. In this case, admittedly the ground on which reassessment notice under Section 148 of the Act was issued was dropped while passing the reassessment order dated 27.03.2006 under Section 143(3) read with Section 147 of the Act. Thus, in view of the decision of this court in the matter of Jet Airways (I.) Ltd. (supra), no occasion to entertain the proposed question of law arises.
