ACIT Vs NK Proteins Pvt. Ltd. (ITAT Ahmedabad)
ITAT Ahmedabad held that additions on the grounds which are not forming part of reasons recorded for reopening of assessment is invalid in the eye of law. Accordingly, such additions are liable to be deleted.
Facts- The assessee is a company engaged in the manufacturing of edible, non-edible oil products and by-products thereof. The assessee filed its original return of income which was taken for scrutiny assessment and regular assessment order under section 143(3) of the Act was passed on 29-12-2011. Thereafter, AO completed the reassessment by making disallowance u/s. 43(5) r.w.s. 73 and sec.40A(2)(b) of Rs.13,89,08,810/- and excess disallowance u/s.14A of Rs. 1,04,652/- and demanded tax thereon.
CIT(A) held that reassessment proceedings is bad in law. Being aggrieved, revenue has preferred the present appeal.
Conclusion- Held that there is no failure on the part of the assessee in disclosing the above income in the Return of Income, therefore the reopening of assessment beyond four years is invalid in the eye of law. Also held that the income escaped as mentioned in the ‘reason recorded’ by AO is not relating to the present Asst. year 2009-10 the same is invalid in the eyes of law and the reassessment is liable to be quashed.
