IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 4482 of 2012 For Approval and Signature:
HONOURABLE MR.JUSTICE V. M. SAHAI HONOURABLE MR.JUSTICE N.V. ANJARIA =========================================================
========================================================= ROTO SCREENTECH PRIVATE LIMITED Versus ASSISTANT COMMISSIONER OF ICOME TAX ========================================================= Appearance :
MRTUSHARPHEMANI for Petitioner(s) : 1,MS VAIBHAVI K PARIKH for Petitioner(s) : 1, MR PRANAV G DESAI for Respondent(s) : 1, =========================================================
CORAM : HONOURABLE MR.JUSTICE V. M. SAHAI
and HONOURABLE MR.JUSTICE N.V. ANJARIA Date : 25/07/2012 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE V. M. SAHAI) We have heard Mr. Tushar Hemani, learned counsel for the petitioner and Mr. Pranav G. Desai, learned counsel for the respondent. Though the matter is listed for admission, with the consent of learned counsels for the parties, we have taken this writ petition for final hearing at the admission stage as the facts are not disputed and only legal question is involved.
2.0 Rule. Mr. Pranav G. Desai, learned counsel waives service of notice of Rule on behalf of respondent.
3.0 This writ petition has been filed challenging the Notice dated 17th October 2011 issued under Section 148 of the Income Tax Act, 1961 (for short 'the Act') for reopening the assessment for the Assessment Year 200607 on the ground that income chargeable to tax has escaped assessment within the meaning of Section 147 of the Act.
4.0 The assessee filed return of income and the Assessing Officer passed the Assessment Order on 29th December 2008. The Assessing Officer issued questionarie dated 29th October 2008. The authorised representative of the assessee appeared before the Assessing Officer and produced details which were called for by the Assessing Officer. The Assessing Officer examined the audited books of account of the assessee and verified on the test check basis and the assessee's trading result was not disturbed by the Assessing Officer and thereafter the Assessing Officer passed reasoned order. After a period of four years, the Assessing Officer/Assistant Commissioner of Incometax, CircleV, Rajkot recorded its reasoning on 18th November 2011 that the assessee has maintained exclusive method of accounting and thereby the unutilized Cenvat Credit to the tune of Rs.62,62,259/ availed on purchase of raw material and it was neither credited to the profit and loss account nor it had been offered for computing total income.
4.1 From the books of account it is clear that the assessee has mentioned with regard to cenvat credit as under:
“CENVAT: Cenvat credit availed on purchase of goods and capital items have been reduced from their respective purchase price (cost). The duty credit available on inputs is higher than duty payable on final products. Thus, the credit is available but it remains unutilized and lying idle, as there is no scope for utilising the same, therefore unutilized credit of current year has been added to the purchase as a part of purchase cost.”
4.2 The assessee has also placed on record of the Assessing Officer the details of deviation dated 31st March 2006 in the method of valuation prescribed under Section 145 A of the Act, which is extracted as below.
ROTO SCREENTECH PRIVATE LIMITED, RAJKOT ANNEXURE: A 31/03/2006 Details of Deviation in the method of valuation prescribed u/s145 A
5.0 From the aforesaid facts it is clear that the amount of Cenvat credit availed by the assessee on purchase of raw materials was shown in the books of accounts and had been offered by the assessee to the Assessing Officer for computing total income. After four years, it was not open to the Assessing Officer to reopen assessment unless there was any new material found or there was failure on the part of the assessee to disclose correct facts.
6.0 For the aforesaid reasons, the impugned notice issued by the Assessing Officer dated 17th October 2011 (Annexure A to the writ petition) cannot be maintained and deserves to be quashed.
7.0 In the result, this writ petition succeeds and is allowed. The Notice issued under Section 148 of the Income Tax Act, 1961 issued by the Assessing Officer dated 17th October 2011 [AnnexureA to the writ petition] is hereby quashed. Rule is made absolute. Parties shall bear their own costs [V. M. SAHAI, J.] Amit [N. V. ANJARIA, J.]