At, Income Tax Appellate Tribunal Ahmedabad
By, THE HONOURABLE MR. MAHAVIR PRASAD
By, JUDICIAL MEMBER & THE HONOURABLE MR. WASEEM AHMED
By, ACCOUNTANT MEMBER
For the Appellant: Anil R. Shah, Advocate, Kinjal Shah, AR. For the Respondent: Ila M. Parmar, Sr. D.R.
Mahavir Prasad, Judicial Member:
1. This appeal by the Assessee is directed against the order of the Ld. CIT(A)-2, Vadodara dated 10.12.2014 pertaining to A.Y. 2003-04 and following grounds have been taken:
1. The CIT(A) has erred both in Law and in fact not following clear cut direction of Hon. Income-tax Appellate Tribunal in their order of 4-10-2013 on issue u/s.148 proceedings.
2. Without prejudi
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ce, CIT(A) has erred both in Law and in fact in confirming the Reopening of Assessment u/s.148 of the Act since Reason Recorded by the Assessing Officer being vague, uncertain, case of change of opinion and does not have nexus with facts of the case.
1. Your Appellant further submits that the CIT(A) has erred in not granting relief/deduction u/s.80HHC which was rightly allowed in order u/s.143(3) on facts of the case and as per provisions of Law and the CIT(A) has merely followed earlier order of his predecessor while rejecting the claim.
2. The CIT(A) has erred in confirming the levy of Interest u/s.234B and 234C which is not applicable on the facts of the case and not properly worked out. The operating part of Assessment Order "charge interest accordingly" is vague uncertain and not clear and as held in the case of ACIT vs. S.K. Patel Family, 251 CTR page 427 (Guj.) interest is not chargeable .
2. Brief facts of the case that the original order u/s. 143(3) was passed on 28/03/2006. Subsequently, the case was reopened by issuing notice u/s. 148 on 18/03/2008 Order u/s. 143(3) r.w.s 147 was passed 28/11/2008 in which the relief u/s. 80IA was deducted from the profit and gains of the business before computing relief u/s. 80HHC of the Act and accordingly relief u/s. 80HHC was recomputed. The appellant filed an appeal before CIT(A) who dismissed the appeal. In further appeal to ITAT, the appellant took a plea that reopening . A.Y. 2003-04 of the assessment u/s. 148 was not valid. The ITAT vide its order dated 04/10/2013 in ITA no. 1472/AHD/2010 set aside the order of the CIT(A) and he restored this to his file with direction to examine the legality of issue of notice u/s. 148 of the Act. The issue for the claim of deduction u/s. 80 HHC was also restored to the file of the CIT(A).
3. In pursuance of the ITAT order for re-adjudication , ld. CIT(A) decided the matter against the appellant. So far ground nos. 1 & 2 are concerned, same are interconnected. Today, we have seen original assessment record produced by the ld. D.R. and for assessment order, we could see that reasons were recorded prior to issuance of notice to the appellant. Thus, we do not find any ambiguity in the notice for re-opening of the case.
4. Now we come to the merit of the case. The appellant contention is that earlier relief/deduction u/s. 80HHD was rightly allowed in order u/s. 143(3) of the Act. As we could see the assessment as well as assessment record, ld. A.O. made detailed enquiry with regard to deduction u/s 80HHC and after due deliberations order was passed u/s. 143(3A) of Income Tax Act. In our considered opinion, we hold that order u/s 143(3) was passed after detailed enquiry and notice u/s. 148 is under the law is amount to change of opinion and does not have any nexus with the facts of the case.
5. In support of its contention, ld. A.R. cited an order of Gujarat High Court in the matter of Heavy Metal & Tubes Ltd. vs. DCIT  35 taxmann.com 288 (Guj.), it is held:
"Section 147 read with section 145 of the Income-tax Act, 1961 - Income escaping assessment - Non-disclosure of primary facts . A.Y. 2003-04 [To value closing stock] - Assessment year 2008-09 - Whether, where issue of accounting treatment in respect of unutilized CENVAT credit for purpose of valuing closing stock was already examined by Assessing Officer during scrutiny assessment, reopening of assessment on same issue without any tangible material was mere change of opinion and hence not sustainable - Held, yes [Para 11] [In favour of assessee]"
6. In facts and circumstances of the case in hand and Revenue does not have any fresh material in its hand to reopen the case of the assessee as well as respectfully following the Jurisdictional High Court, we allow this appeal of the appellant.
7. In the result, appeal filed by the Assessee is allowed.