Law: Income Tax Act, 1961

Section: 32,143,147

Section 32, read with sections 143 and 147, of the Income-tax Act, 1961 - Depreciation - Allowance/Rate of (Reassessment) - Assessment years 2008-09 and 2009-10 - Assessee-company was engaged in business of manufacture and assembly of automobile parts/components - It acquired Customer Care Parts business from its holding company 'H' - Assessing Officer finding that assessee had claimed depreciation on vendor and dealer network which did not fall in category of intangible asset, initiated reassessment proceedings - Assessee participated in said proceedings - Subsequently, assessment order was passed rejecting assessee's claim - Assessee filed writ petition challenging validity of reassessment proceedings - Whether in absence of raising any objection to reopening of assessment, question of disposing objections by passing a speaking order before proceeding with reassessment did not arise - Held, yes - Whether even otherwise, assessee having participated in reassessment proceedings in pursuance to issuance of notice under section 143(2), impugned order passed under section 143(3), read with section 147, was in accordance with law - Held, yes [Para 13] [In favour of revenue] FACTS â–  The assessee company was engaged in the business of manufacture and assembly of automobile parts/components. It acquired the Customer Care Parts (in short, CCP) business from its holding company 'H' and filed its return declaring loss. â–  The Assessing Officer finding that assessee had claimed depreciation on vendor and dealer network, which did not fall in category of intangible asset, initiated reassessment proceedings. â–  In pursuance to notice issued under section 143(2), the assessee participated in reassessment proceedings. â–  Thereupon, the Assessing Officer passed an order under section 143(3), read with section 147, rejecting assessee's claim for depreciation on vendor/dealer network. â–  The assessee filed instant petition challenging validity of reassessment proceedings. HELD â–  The main purpose for initiating the proceedings for reopening the assessment is that the issue regarding depreciation claim on dealer network and vendor network was…

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