The Commissioner Of Income Tax-3 v. M/S.indian Express Newspapers (Bom) Ltd

ttm IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.5984 OF 2010 The Commissioner of Income Tax-3.. AppellantVs.M/s.Indian Express Newspapers (BOM) Ltd... Respondent. Mr.Vimal Gupta for the appellant Mr.Amol Joshi i/b Ms.Poorvi Kamani for the respondent CORAM: J.P. DEVADHAR & K.K. TATED, JJ.DATE: 18TH OCTOBER, 2011. P.C. 1. Whether the ITAT was justified in holding that the reopening of the Assessment beyond four years from the end of the relevant Assessment Year was bad in law is the question raised in this appeal. 2. The Assessment Year involved herein is Assessment Year 1998-1999. 3. In the Assessment Year in question, the assessee had filed return of income declaring loss of Rs.42,07,35,827/-. Assessment was completed under section 143(3) of the Act computing the loss at Rs.36,37,51,852/-. However, the Assessing Officer did not allow carry forward of the loss on the ground that certain barter transactions were not reflected in the books. income declaring loss of Rs.42,07,35,827/-. Assessment was completed under section 143(3) of the Act computing the loss at Rs.36,37,51,852/-. However, the Assessing Officer did not allow carry forward of the loss on the ground that certain barter transactions were not reflected in the books. 4. Later on, the assessment was sought to be reopened by recording the “i) In the original order of assessment dated 12/03/2001 business loss was determined at Rs.59,52,84,329/-. This business loss was set off against “Income from House Property” at Rs.9,61,68,366/- and income under the head “Other sources” Rs.13,53,64,111/- and the balance remaining loss at rs.36,37,51,852/- was treated by Assessing Officer to be NIL on account of barter transactions. In doing so, Assessing Officer instead of treating only business loss NIL, set off house property income and income from other sources which ought to have been brought to charge of tax. ii. The stamp duties of Rs.1,35,33,557/- being capital expenditure remained to be disallowed. iii. Assets written off amounting to Rs.8,13,182/- being capital expenditure remained to be disallowed.” 5. The assessee objected to the reopening of assessment but the same was rejected and reassessment order was passed. 6. On appeal filed by the Assessee, the CIT (A) was of the opinion that the requirement of proviso to section 137 of the Act was not complied with and accordingly, reopening of the assessment was bad in law. 7.On further appeal filed by the Revenue, the ITAT while upholding the order of CIT(A) held that in the present case, the Assessing Officer took a conscious decision to allow set off of income and disallow the balance loss and therefore, in the facts and circumstances of the present case, reopening of the assessment beyond four years from the end of the relevant Assessment Year cannot be said to be on account of failure on the part of the Assessee to disclose fully and truly all the material facts necessary for the assessment. We see no infirmity in the above order passed by the ITAT. 8. Accordingly, appeal is dismissed. (K.K. TATED, J.) (J.P. DEVADHAR, J.)