Tuesday, 14 August 2012

S. 143(1) assessment cannot be reopened u/s 147 in absence of “new material”

Telco Dadajee Dhackjee Ltd vs. DCIT (ITAT Mumbai Third Member)

The assessee filed a ROI in which it claimed deduction for non-compete fees and depreciation on leased premises which was accepted by the AO vide Intimation u/s 143(1). Thereafter, he issued a notice u/s 148 seeking to reopen the assessment on the ground that the expenses were not allowable. The assessee challenged the reopening on the ground that (a) the AO had not given a copy of the recorded reasons and (b) there was no fresh material to justify the reopening. Before the Tribunal, though the division bench agreed that there was no new material, the AM held that in the case of a s. 143(1) intimation, new material was not required while the JM took the contrary view. On a reference to the Third Member HELD by the Third Member:

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