It is an admitted position that no notice under Section 143(2) had been issued while making assessment under Section 143(3) read with Section 147. The Apex Court in the case of National Thermal Power Co. Ltd. v. CIT [1998] 229 ITR 383 has held that the Tribunal has discretion to allow or not to allow a new ground to be raised. But in a case where the Tribunal is only required to consider the question of law arising from facts which are on record in the assessment proceedings, there is no reason why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee.
In case of Ashok Taksali (supra), the Rajasthan High Court came across a similar question. The Bench was of the opinion that once a salary income of the block year has been taxed and such tax has been deducted at source, there is no question of holding that the income of the assessee was undisclosed income of the block period. It was observed as under:-
Firstly, the petitioners had lodged their refund claims at the relevant time itself way back in the year 1991 when the question of classification was decided in their favour by the Commissioner. Secondly, the Department did not release the refund for a considerable period of time since such order of the Commissioner (Appeals) was challenged before the Tribunal. Thirdly, the Commissioner (Appeals) disposed of the petitioners’ case on 11-10-2002 with respect to the refund and not with respect to the original claim of classification.
The CESTAT has recorded finding that there is prima facie finding of suppression of production and clandestine removal. The balance sheets thus will not reflect the true and correct financial position of the company. The Tribunal was lenient enough in directing the appellant to deposit only Rs. 1 crore and waiving the remaining amount of Excise duty and penalty, which together with would amount to about Rs. 16 crores. We, therefore, do not find any substantial question of law for consideration and interference in this appeal. The Central Excise Appeal is accordingly dismissed in-limine.
Considering all the facts and circumstances and taking into account all the contentions raised by the affidavits and reply affidavits, considering the decisions of other High Courts, Supreme Court and the Division Bench of this High Court on the issues raised by the Regional Director and the submissions during the course of hearing, I am satisfied that the observations made by the Regional Director, Ministry of Corporate Affairs, do not survive. I have come to the conclusion that the present scheme of arrangement is in the interest of its shareholders and creditors as well as in the public interest and the same deserves to be sanctioned.
The question as to whether the business is derived from or attributable to SLR or non-SLR funds would not make any difference for the purposes of qualifying the interest earned by the cooperative bank under Section 80P (2) (a) (i) as the deposits of surplus idle money available from working capital, including reserves, excess collection of interest tax and other incomes are all attributable to the business of banking. The interest from such deposits cannot be said to be beyond the legitimate business activities of the bank.
From the material documents allowed to be produced, the assessee could satisfy the Commissioner (Appeals) that the place of effective management of its enterprises was situated at Netherlands and thus, the requirement of condition in Article 8A of DTA agreement was met with. The Tribunal has rightly confirmed the decision of the Appellate Commissioner holding the assessee to be eligible for benefits of DTAA.
As is more than apparent, assessment was completed on scrutiny. In post assessment period, audit party raised the objection and Assessing Officer had strongly objected to such objections by communicating internally as mentioned hereinabove. In such background, reasons for reopening if are noted, they are almost identically worded as that of audit report. No material worth the name emerges to indicate any independent application of mind. Facts are quite glaring on the contrary & they clearly establish absence of subjective satisfaction of Assessing Officer. Thus, the ground raised by the petitioner that such notice of reopening is invalid for the Assessing Officer having not formed his independent belief requires to be sustained.
In so far as the impugned order is concerned, there is nothing stated in the operative part which would seem to indicate that the CIC has come to the conclusion which it has, is based on the fact that, the economic interest of the country, will get effected. The CIC, in the operative part has merely recorded what has been conveyed to it vis-a-vis the procedure for selection of cases for scrutiny.
In this case Assessing Officer proposed to reopen the assessment beyond a period of four years from the end of relevant assessment year, while there was full and true disclosure on part of the petitioner during original assessment. With respect to the first issue of discount/commission, the Assessing Officer called for the details of such payments in excess of Rs. 50 lakhs. Such details were promptly provided. No further questions arose from the Assessing Officer in this regard. Like-wise, during the assessment, the Assessing Officer also called upon the petitioner to supply full details of the roaming charges paid to various telecom operators. Such details were also made available.
