Commissioner of Income­-tax­-7 v. National Stock Exchange of India Ltd
[Citation -2019-LL-0218-35]

Metadata

Citation 2019-LL-0218-35
Appellant Name Commissioner of Income­-tax­-7
Respondent Name National Stock Exchange of India Ltd.
Court HIGH COURT OF BOMBAY
Relevant Act Income-tax
Date of Order 18/02/2019
Assessment Year 1996-97
Judgment View Judgment
Keyword Tags reopening of assessment • expenditure incurred • scrutiny assessment • expenses incurred • interest income • taxable income • material facts • gross interest • exempt income • reassessment • full and true disclosure of material facts • notice for reopening of assessment
Bot Summary: Following question is presented for our consideration: Whether on the facts and in the circumstances of the case and in law, the ITAT was right in holding that the reopening is invalid without appreciating the fact that 'failure' was attributable to the assessee since it claimed gross interest on tax free bonds as exempt without disclosing the expenditure incurred ::: Uploaded on - 20/02/2019 ::: Downloaded on - 21/02/2019 09:36:26 ::: Priya Soparkar 2 4 itxa 1164 16 o thereon 3. The Assessing Officer after initially framing scrutiny assessment under Section 143(3) of the Income Tax Act, 1961 issued a notice of reopening of assessment beyond a period of four years from the end of relevant assessment year. The reasons recorded by the Assessing Officer are as under. The reasons would show that the assessee had earned gross interest on tax free bonds. The interest income was excluded from the taxable income on gross basis. According to the Assessing Officer, the exempt income had to be computed after allocating expenses incurred on earning exempt receipts which the assessee had not done in the present case. Whatever be the validity of the Assessing Officer's contention in ::: Uploaded on - 20/02/2019 ::: Downloaded on - 21/02/2019 09:36:26 ::: Priya Soparkar 3 4 itxa 1164 16 o this respect, it cannot be stated, in fact not even so stated by the Assessing Officer, that there was failure on the part of the assessee, but disclose truly and fully all material facts necessary for assessment.

Judgment



Priya Soparkar 1 4 itxa 1164 16 o IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1164 OF 2016 Commissioner of Income Tax 7 Appellant V/s. M/s National Stock Exchange of India Ltd. Respondent Mr.Suresh Kumar for Appellant. Mr.Jehangir Mistri, Senior counsel with Mr.Atul Jasani for Respondent. CORAM : AKIL KURESHI AND M.S.SANKLECHA, JJ. DATE : FEBRUARY 18, 2019. P.C.: 1. Revenue has filed this appeal against judgment of Income Tax Appellate Tribunal ("the Tribunal" for short). 2. Following question is presented for our consideration: Whether on facts and in circumstances of case and in law, ITAT was right in holding that reopening is invalid without appreciating fact that 'failure' was attributable to assessee since it claimed gross interest on tax free bonds as exempt without disclosing expenditure incurred ::: Uploaded on - 20/02/2019 ::: Downloaded on - 21/02/2019 09:36:26 ::: Priya Soparkar 2 4 itxa 1164 16 o thereon? 3. assessment year under consideration is 1996 97. Assessing Officer after initially framing scrutiny assessment under Section 143(3) of Income Tax Act, 1961 ("the Act" for short) issued notice of reopening of assessment beyond period of four years from end of relevant assessment year. Tribunal by impugned judgment held that notice of reassessment was invalid primarily on ground that there was no failure on part of assesseee to disclose truly and fully all necessary facts necessary for assessment. reasons recorded by Assessing Officer are as under. 4. reasons would show that assessee had earned gross interest on tax free bonds. interest income was excluded from taxable income on gross basis. However, according to Assessing Officer, exempt income had to be computed after allocating expenses incurred on earning exempt receipts which assessee had not done in present case. Whatever be validity of Assessing Officer's contention in ::: Uploaded on - 20/02/2019 ::: Downloaded on - 21/02/2019 09:36:26 ::: Priya Soparkar 3 4 itxa 1164 16 o this respect, it cannot be stated, in fact not even so stated by Assessing Officer, that there was failure on part of assessee, but disclose truly and fully all material facts necessary for assessment. In that view of material, Tribunal in our opinion committed no error. 5. Income Tax appeal is dismissed. (M.S.SANKLECHA,J.) (AKIL KURESHI,J.) . ::: Uploaded on - 20/02/2019 ::: Downloaded on - 21/02/2019 09:36:26 ::: Commissioner of Income-tax-7 v. National Stock Exchange of India Ltd
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