Bombay H.C : The assessee has not debited any amount on account of write off of debts/advances to P&L a/c as in Sch. 17 of balance sheet, the “sundry irrecoverable balances written off is shown at nil

High Court Of Bombay

Rallis India Ltd. vs. Assistant Commissioner Of Income Tax & Anr.

Section 147

Asst. Year 2004-05

Dr. D.Y. Chandrachud & J.P. Devadhar, JJ.

Writ Petn. No. 2514 of 2009

4th March, 2010

Counsel Appeared :

Percy J. Pardiwala with Jitendra Jain i/b Atul K. Jasani, for the Petitioner : Vimal Gupta, for the Respondents

JUDGMENT

Dr. D.Y. Chandrachud, J. :

Rule. With the consent of counsel, rule is made returnable forthwith. By consent of counsel for both the parties, the petition is taken up for hearing and final disposal.

2. A notice was issued on 18th July, 2008 under s. 148 of the IT Act, 1961 (‘Act’) for reopening an assessment for asst. yr. 2004-05. An order has been passed on 30th Nov., 2009 disposing of the objections filed by the petitioner to the reopening of the assessment. Both the notice and the order have been challenged. The petitioner filed its return of income for asst. yr. 2004-05 on 29th Oct., 2004 and declared a loss of Rs. 52.87 crores. While computing this loss, the petitioner claimed a deduction of bad debts amounting to Rs. 12,00,43,394. The petitioner also computed a book loss in the amount of Rs. 42,14,40,497 under s. 115JB. The return of income was revised on 31st March, 2006 so as to declare a loss of Rs. 53.20 crores. The return was selected for scrutiny assessment by a notice under s. 143(2). The AO issued two questionnaires during the course of the assessment proceedings, one of them being on 29th Sept., 2006. A specific query was raised in regard to the allowability of the bad debts claimed by the petitioner under s. 36(1)(vii) r/w s. 36(2) and on the computation of book profits under s. 115JB. The petitioner responded to the queries by its letters dt. 6th, 8th, 14th and 27th Dec., 2006. The AO passed an order of assessment on 29th Dec., 2006, by which the claim in respect of bad debts was disallowed to the extent of Rs. 5.54 crores. The AO however allowed the claim to the extent of Rs. 6.46 crores. After recomputing the book profits, the AO assessed the income of the petitioner under s. 115JB at Rs. 41.95 crores. While recomputing the book profits, the AO rejected the exclusion on the profit of the sale of undertaking and fixed assets but accepted the computation in relation to other items. The petitioner thereupon preferred an appeal before the CIT(A). The CIT(A) by an order dt. 26th June, 2008 allowed relief to the petitioner in respect of the bad debts but confirmed the disallowance in respect of book profits under s. 115JB. As a result of the order passed by the CIT(A), the entire claim on account of bad debts in the amount of Rs. 12 crores came to be allowed under s. 36(1)(vii). Cross- appeals filed by the petitioner and by the Revenue are pending before the Tribunal.

On 16th July, 2008, a notice under s. 148 was issued to the petitioner by the AO. The basis on which the assessment is sought to be reopened is set out in the reasons supplied to the petitioner on 25th June, 2009. For the purposes of convenience, it would be appropriate to extract the reasons as provided, which are as follows :

“It is seen that the assessee has claimed bad debts and advances amounting to Rs. 12,00,43,394. During assessment proceedings, the assessee’s claim of Rs. 5,54,19,503 was disallowed and the balance claim of Rs. 6,46,23,891 was allowed to the assessee.

3. It is further noticed that the assessee has not debited any amount on account of write off of debts/advances to P&L a/c as in Sch. 17 of balance sheet, the “sundry irrecoverable balances written off is shown at nil. Moreover, the assessee has claimed bad debts written off by way of debiting provision for doubtful debts and advances. Further, while computing the book profit under s. 115JB the assessee has not considered the following provisions made in the books of accounts :

4. Provisions for diminution in value of investments Rs. 15,72,000 Rs. 17,47,94,316 3. Thus, this has resulted in escapement of income of Rs. 23,94,18,207 (Rs. 6,46,23,891 + Rs. 17,47,94,816) within the meaning of s. 147 of the IT Act, 1961. 4. Hence, I have reason to believe that there is escapement of income of Rs. 36,21,500 and accordingly it is a fit case for reopening under s. 147 of the IT Act, 1961 within the time-limit of four years from the end of the relevant assessment year. Hence, the assessment for asst. yr. 2004-05 is hereby reopened.” The petitioner filed objections to the reopening of the assessment on 13th Nov., 2009. The objections have been disposed of by an order dt. 30th Nov., 2009.

5. From the reasons which have been furnished to the petitioner while reopening the assessment and the order that has been passed disposing of the objections, the basis on which the assessment is sought to be reopened pertains to two items. The first relates to the write off of bad debts in the amount of Rs. 6.46 crores. The second relates to the computation of book profits under s. 115JB. Insofar as the write off of the bad debts is concerned, the AO has stated that the petitioner had not debited any amount on account of write off of debts/advances to the P&L a/c and that in Sch. 17 of the balance sheet, the sundry irrecoverable balances written off are shown at nil. While disposing of the objections of the petitioner, the AO has again reiterated that the assessee has not debited an amount of Rs. 6.46 crores in the P&L a/c and that consequently the assessee would not be entitled to allowance of bad debts under s. 36(2). Insofar as the computation of book profits is concerned, the AO has stated that the assessee had not considered the following provisions namely those relating to doubtful debts and advances and for the diminution in value of investments in the books of account. These are the two grounds on which the AO has come to the conclusion that the income chargeable to tax had escaped assessment so as to warrant an exercise of the power to reopen the assessment under s. 147 of the Act.

6. Counsel appearing on behalf of the petitioner has challenged the basis on which the assessment is sought to be reopened under both the heads noted earlier. Insofar as the claim for bad debts is concerned, it was urged on behalf of the petitioner that during the course of the assessment proceedings, a detailed inquiry was made by the AO. During the course of inquiry, the petitioner clarified by its letter dt. 14th Dec., 2000 that the write off had been made out of debtors provided in the books of account for asst. yrs. 2002-03 and 2003-04 and earlier years which income had been added back to the income and offered to tax in the respective assessment years. Since in the earlier assessment years, these amounts had been added back to the income and offered for taxation, a claim had been made during the assessment year in question as an allowable expense since the debts were not realizable and had been written off in the books of account. A list of the debts written off was provided to the AO. Apart from this, during the course of assessment proceedings, the petitioner furnished a further clarification to the AO on 27th Dec., 2006. On the basis of the material provided, the AO allowed the claim for bad debts to the extent of Rs. 6.46 crores but made a disallowance to the extent of Rs. 5.54 crores. In appeal, the CIT(A) held that the entire claim was justified. Counsel submitted that the reasons which have been furnished by the Revenue for reopening the assessment are extraneous to the provisions of s. 36(1)(vii) since the statute does not require that the write off of debts/advances be reflected in the P&L a/c for the assessment year in which the claim for deduction is made. In the present case, it was submitted that a debit was made to the P&L a/c in the initial year against which a credit was reflected in the provision for doubtful debts. No claim was made however for a deduction in the year in which a provision for doubtful debts was made by virtue of the Explanation to s. 36(1)(vii). However, in the subsequent year when the debts in question were treated as having become bad and irrecoverable, the provision for doubtful debts was duly debited against a corresponding credit to the debtors’ accounts. In any event, it was submitted that the reopening of the assessment was not warranted since the AO had specifically applied his mind to the issue during the course of the assessment proceedings. Moreover, the assessment is sought to be reopened on a basis which is not contemplated by s. 36(1)(vii).

7. In so far as the computation of book profits under s. 115JB is concerned, counsel appearing on behalf of the petitioner submitted that on the basis of the law as it then stood a provision for doubtful debts and advances and for diminution in the value of investments did not fall within the purview of cl. (c) to Expln. 1 to s. 115JB. This, it was submitted, was the law which held the field in view of the judgment of this Court in CIT vs. Echjay Forgings (P) Ltd. (2001) 166 CTR (Bom) 100 : (2001) 251 ITR 15 (Bom) and the judgments of the Delhi High Court in CIT vs. Eicher Ltd. (2006) 205 CTR (Del) 469 : (2006) 287 ITR 170 (Del) and CIT vs. HCL Comnet Systems & Services (2008) 219 CTR (Del) 226 : (2007) 292 ITR 299 (Del). As a matter of fact, it was submitted that the Supreme Court in the appeal which arose out of the judgment of the Delhi High Court in HCL (supra) held that the provision for doubtful debts and advances could not be regarded as a provision for a liability other than an ascertained liability within the meaning of cl. (c) of the Expln. 1 to s. 115JA. Consequently, the order of the AO was consistent with the judgments of this Court and the Delhi High Court. The order of assessment is also in accord with the law as declared by the Supreme Court, though subsequently. As a matter of fact, Parliament stepped in after the judgment of the Supreme Court and amended the provisions of the Explanation to s. 115JB so as to specifically include the amount or amounts set aside as provision for diminution in value of asset as cl. (i) to Expln. 1, by the Finance Act of 2009. Though the amendment by the Finance Act of 2009 was with retrospective effect from 1st April, 2001, the amendment was brought about after the notice was issued by the AO, seeking to reopen the assessment. The validity of the notice of the AO seeking to reopen the assessment would have to be determined on the law as it prevailed on the date of the notice having regard to the judgment of the Supreme Court in CIT vs. Max India Ltd. (2007) 213 CTR (SC) 266 : (2008) 166 Taxman 188 (SC). On the other hand, it was urged by counsel on behalf of the Revenue that (i) Whether the bad debts had as a matter of fact been written off by the assessee was not clear during the course of assessment proceedings. Counsel submitted that the assessee had in Sch. 17 to the annual accounts for asst. yr. 2003-04 reflected a nil provision for bad debts for the year ending 31st March, 2004. Consequently, it was submitted that since the assessee had not written off the bad debts in the P&L a/c for the year ending on 31st March, 2004 and had in fact shown nil debts under the head of bad debts in Sch. 17 dealing with the operating expenses, the assessee would not be entitled to a deduction under s. 36(1)(vii). On the second aspect of the matter, namely, the computation of book profits under s. 115JB, the submission of counsel for the Revenue was that the issue was not raised during the course of the assessment proceedings. Consequently, it was submitted that the AO was not precluded from reopening the assessment under s. 147. Counsel submitted that the judgment of the Supreme Court in Max India Ltd. (supra) on which reliance has been placed must be confined to s. 80HHC of the IT Act, 1961. For convenience of exposition, it would be appropriate to take both the grounds, which have been furnished for reopening the assessment separately. (A) The claim for bad debts :

10. During the course of the assessment proceedings, the assessee claimed a deduction of bad debts in the amount of Rs. 12 crores. The computation of total income for asst. yr. 2004-05 reflects inter alia income under the head of profits and gains of business or profession to which is added a provision for doubtful debts in the amount of Rs. 13.46 crores. A separate provision was made for doubtful advances, doubtful debts by way of inter-corporate deposits to subsidiaries and for diminution in the value of investments. A deduction was thereupon specifically claimed on account of bad debts written off by debiting the provision for doubtful debts and advances to the extent of Rs. 12 crores. During the course of the assessment proceedings, the AO specifically applied his mind to the claim of the assessee for a deduction on account of bad debts. Two letters were addressed by the assessee to the AO on 14th Dec., 2006 and 27th Dec., 2006. By these letters, the assessee clarified that the write off had been made out of debtors provided for in the books of account for asst. yrs. 2002-03 and 2003-04 and earlier years which had been added back to the income and offered to tax in the respective assessment years. However, the management confirmed that the debts were not realizable and were hence to be written off in the books. Party- wise details of debts written off were furnished to the AO. The assessee clarified that since in the earlier years the amount had been added back to the income and offered for taxation, the claim is an allowable expense in the current year. The assessee also recorded that it had produced debtors accounts for verification. A list of debtors whose debts had gone unpaid due to closure of the business of the debtor, bankruptcy of the debtor or cessation of the business relationship between the assessee and the debtor was furnished. The assessee clarified that in respect of some of the debtors, there was an ongoing business relationship and efforts were being made to recover the debt; on recovery of the amount, it would be credited to the P&L a/c. On this basis the AO initially allowed the claim for bad debts to the extent of Rs. 6.46 crores. In appeal, the CIT(A) however held that there was no justification to make a disallowance to the extent of Rs. 5.54 crores since as a matter of business expediency, the assessee was justified in effecting a write off. Consequently, the entire amount was allowed under s. 36(1)(vii).

11. Sec. 36(1) provides that the deductions provided for in its succeeding clauses shall be allowed in respect of the matters dealt with therein, in computing the income referred to in s. 28. Clause (vii) postulates that subject to the provisions of sub-s. (2), the amount of any bad debt or part thereof which is written off as irrecoverable in the accounts of the assessee for the previous year is allowable as a deduction. The Explanation to cl. (vii), which was inserted by the Finance Act, of 2001, provides that for the purposes of the clause, any bad debt or part thereof written off as irrecoverable in the accounts of the assessee shall not include any provision for bad and doubtful debts made in the accounts of the assessee. Consequent upon the Explanation, the write off on account of bad debts has not been effected in those years in which a provision for bad and doubtful debts has been made in the accounts of the assessee. In the present case, the narration of facts would show that during the course of the assessment proceedings, the AO brought his mind to bear upon the question as to whether the assessee is entitled to claim a deduction under s. 36(1)(vii), with respect to bad debts, details of which were furnished to the AO, pursuant to which an assessment order came to be passed under s. 143(3). The reason which weighed with the AO to reopen the assessment is that the assessee has not debited any amount towards the write off of debts/advances to the P&L a/c. Such a requirement is not contained in s. 36(1)(vii). In fact, it would also be necessary to notice at this stage that as a result of the order that was passed by the CIT(A), the assessee has been allowed a deduction in the amount of Rs. 12,00,43,394 which comprises of an amount of Rs. 6.46 crores, which was allowed by the AO and the amount of Rs. 5.54 crores which came to be allowed in the order of the CIT(A). The reopening of the assessment is sought to be effected only in respect of the deduction of an amount of Rs. 6.46 crores that was granted by the AO and not in respect of the additional amount which was allowed by the order of the CIT(A). The learned counsel appearing on behalf of the Revenue submitted during the course of hearing that the AO was perhaps not aware of the order passed by the CIT(A). The order of the CIT (A) was passed on 26th June, 2008 whereas the notice for reopening the assessment was issued on 16th July, 2008.

12. We are conscious of the circumstance that in the present case the reopening of assessment is sought to be effected within a period of four years of the expiry of the relevant assessment year. However, it is now a well- settled position of law that a mere change of opinion would not justify the AO in seeking a recourse to the powers under ss. 147 and 148 and there must be tangible material before the AO to prove that income chargeable to tax has escaped assessment. The principle that there must be tangible material on the basis of which an assessment is sought to be reopened even within a period of four years is now established in view of the judgment of the Supreme Court in CIT vs. Kelvinator of India Ltd. (2010) 228 CTR (SC) 488 : (2010) 34 DTR (SC) 49 : (2010) 320 ITR 561 (SC). The Supreme Court has held thus : “………Therefore, post 1st April, 1989, power to reopen is much wider. However, one needs to give a schematic interpretation to the words ‘reason to believe’ failing which, we are afraid, s. 147 would give arbitrary powers to the AO to reopen assessments on the basis of ‘mere change of opinion’, which cannot be per se reason to reopen. We must also keep in mind the conceptual difference between power to review and power to reassess. The AO has no power to review; he has the power to reassess. But reassessment has to be based on fulfillment of certain precondition and if the concept of ‘change of opinion’ is removed, as contended on behalf of the Department, then, in the garb of reopening the assessment, review would take place. One must treat the concept of ‘change of opinion’ as an inbuilt test to check abuse of power by the AO. Hence, after 1st April, 1989, AO has power to reopen, provided there is ‘tangible material’ to come to the conclusion that there is escapement of income from assessment.”

In the present case, there was an absence of tangible material on the basis of which the assessment could have been reopened. The reason which weighed with the AO is extraneous to the basis on which the deduction can legitimately be claimed under s. 36(1)(vii). This is a case of a mere change of opinion without any tangible material. The reopening of the assessment on this ground is hence unsustainable. (B) Computation of book profitsThe AO has while reopening the assessment stated that in the process of computing the book profits under s. 115JB the assessee had not considered the following provisions made in the books of account, namely (i) Provisions for doubtful debts; (ii) Provisions for doubtful advances; (iii) Provisions for doubtful debts being inter- corporate deposits to subsidiaries; and (iv) Provisions for diminution in the value of investments. While disposing of the objection of the assessee, the AO has also noted that at the initial stage when the computation of income under the provisions of s. 115JB was made, the AO had not formed any opinion nor had he called for details with regard to the provisions made under the heads noted above and while not adding the same to the total income. The issue which falls for determination is, as to whether the reasons which have been furnished by the AO were germane to the provisions made for book profits in s. 115JB. For the purposes of s. 115JB, Expln. 1 provides that “book profit” means the net profit as shown in the P&L a/c for the relevant previous year prepared under sub-s. (2), as increased by the clauses that immediately follow. Sub-s. (2) of s. 115JB provides that every assessee, being a company, shall, for the purposes of the section, prepare its P&L a/c for the relevant previous year in accordance with the provisions of Parts II and III of Sch. VI to the Companies Act, 1956. Now, it is a settled principle of law that for the computation of book profits under s. 115JB, the AO has to accept the authenticity of the accounts maintained in accordance with the provisions of Parts II and III of Sch. VI of the Companies Act, 1956 which are certified by the auditors and passed by the company in its general meeting. The AO does not have jurisdiction to go beyond the net profits as shown in the P&L a/c, save and except to the extent which is provided for in the Explanation. The AO can increase the net profits as reflected in the P&L a/c prepared under Parts II and III of Sch. VI to the Companies Act, 1956 only to the extent that is permissible in the Explanation noted above. [Apollo Tyres vs. CIT (2002) 174 CTR (SC) 521 : (2002) 255 ITR 273 (SC) and CIT vs. HCL Comnet Systems & Services Ltd. (2008) 219 CTR (SC) 222 : (2008) 13 DTR (SC) 105 : (2008) 305 ITR 409 (SC)]. Clause (c) of Expln. 1 deals with “the amount or amounts set aside to provisions made for meeting liabilities, other than ascertained liabilities”.

In response to the notice for reopening of the assessment, the assessee, in the course of its objections pointed out that the view of the AO was consistent with the law laid down by this Court in CIT vs. Echjay Forgings (P) Ltd. (supra) and the judgments of the Delhi High Court in CIT vs. Eicher Ltd. (supra) and CIT vs. HCL Comnet Systems & Services (supra). In the decision in Echjay (supra). Hon’ble Mr. Justice S.H. Kapadia (as he then was) speaking for a Division Bench of this Court noted that under cl. (c) of the Explanation to s. 115JB, unless a provision is made for ascertained liabilities, the provision has to be included in the book profits for the purpose of taxation under s. 115J. The Delhi High Court had held in Eicher and in HCL (supra) that under Expln. 1(c) the increase shall be of the amount or amounts set aside for meeting liabilities other than ascertained liabilities. The Delhi High Court held that ascertained liabilities are not to be included in the book profits as defined in that section. In our view, the basic question which would arise is as to whether a provision made for doubtful debts or advances can be regarded at all as a provision made for meeting liabilities in the first place. In order that cl. (c) should apply, there must be a provision; the provision must be for meeting a liability and the liability in question mustbe other than an ascertained liability.

16. The Supreme Court had occasion to consider the interpretation of cl. (c) to Expln. 1 in its judgment in HCL Comnet Systems & Services Ltd. (supra). The judgment of the Supreme Court arose in appeal from the judgment of the Delhi High Court to which a reference has been made earlier. Hon’ble Mr. Justice S.H. Kapadia, speaking for a Bench of the Supreme Court held that a debt which is payable by the assessee must be distinguished from a debt which is receivable by the assessee. A provision for bad and doubtful debts is made to cover up the probable diminution in the value of the asset namely a debt which is an amount receivable by the assessee. Such a provision, the Supreme Court held, cannot be regarded as a provision for a liability because even if a debt is not recoverable, no liability could be fastened upon the assessee. The Supreme Court held thus : “…… The assessee’s case would, therefore, fall within the ambit of item (c) only if the amount is set aside as provision; the provision is made for meeting a liability; and the provision should be for other than an ascertained liability, i.e., it should be for an unascertained liability. In other words, all the ingredients should be satisfied to attract item (c) of the Explanation to s. 115JA. In our view, item (c) is not attracted. There are two types of ‘debts’. A debt payable by the assessee is different from a debt receivable by the assessee. A debt is payable by the assessee where the assessee has to pay the amount to others whereas the debt receivable by the assessee is an amount which the assessee has to receive from others. In the present case, the ‘debt’ under consideration is a ‘debt receivable’ by the assessee. The provision for bad and doubtful debts, therefore, is made to cover up the probable diminution in the value of the asset, i.e., debt which is an amount receivable by the assessee. Therefore, such a provision cannot be said to be a provision for a liability, because even if a debt is not recoverable no liability could be fastened upon the assessee. In the present case, the debt is the amount receivable by the assessee and not any liability payable by the assessee and, therefore, any provision made towards irrecoverability of the debt cannot be said to be a provision for liability. Therefore, in our view, item (c) of the Explanation is not attracted to the facts of the present case”. In the present case also, the debts written off were those receivable by the assessee. These are not liabilities and did not fall within cl. (c) to Expln. 1 as explained by the Supreme Court. Subsequent to the decision of the Supreme Court in HCL (supra), Parliament stepped in to amend Expln. 1 to s. 115JB by the Finance Act of 2009. As a result of the amendment, cl. (i) came to be inserted in Expln. 1 so as to provide for the amount or amounts set aside as provision for diminution in the value of an asset. Though the amendment was made with retrospective effect from 1st April, 2001, it was enacted into law after the AO had exercised the power to reopen the assessment in the present case by his notice dt. 16th July, 2008. Consequently, on the date on which the AO exercised his jurisdiction under s. 148, the amendment which was brought in subsequently by the Finance Act, of 2009 was not in existence.

A legislative amendment, though made with retrospective effect has been held not to justify a recourse to the revisional power of the CIT under s. 263 of the IT Act in CIT vs. Max India Ltd. (supra). Counsel for the Revenue sought to distinguish the judgment in Max India (supra) on the ground that it dealt with s. 80HHC and one of the grounds which weighed with the Supreme Court was that the section had been amended several times. The judgment of the Supreme Court cannot be distinguished for the reasons as suggested by the counsel for the Revenue. The principle which has been laid down in the judgment of the Supreme Court cannot be confined to s. 80HHC. In that case, the revisional authority had sought to exercise its revisional jurisdiction under s. 263. The exercise of power was challenged firstly on the ground that two views on the interpretation of the provision were possible and hence, recourse to s. 263 was not permissible. Moreover, the second ground which appears to have been urged was that the retrospective amendment to the statutory provision in question would not have a bearing on the correctness of the recourse to s. 263 since on the date on which the power was exercised by the CIT, the legislative amendment had not been brought into force. The judgment of the Supreme Court notes firstly that on the date on which the CIT passed his order, two views on the word “profit” under s. 80HHC were possible and the provision itself had been amended on several occasions. The second ground which weighed with the Supreme Court was that the subsequent amendment in 2005 of the provisions of s. 80HHC, even though retrospective, would not attract the provisions of s. 263, particularly when the Court would have to take into account the position of law as it stood on the date when the CIT passed his order in purported exercise of his powers under s. 263.

In the present case, the principle of law which has been laid down by the Supreme Court in Max India (supra) would be attracted. On the date on which the AO purported to exercise his power to reopen the assessment under s. 147, the legislative amendment by the insertion of cl. (i) to Expln. 1 to s. 115JB had not been brought into force on the statute book. Obviously, therefore, the subsequent amendment could not have been and is not a ground which has been taken by the AO, while reopening the assessment. The validity of the notice issued by the AO in seeking to reopen the assessment must be determined with reference to the reasons which are found in support of the reopening of the assessment. These reasons cannot be allowed to be supplemented on a basis which was not present to the mind of the officer and could not have been so present on the date on which the power to reopen the assessment was exercised. We, therefore, hold that the principle laid down by the Supreme Court in Max India (supra) would be attracted to the present case. Consequently, it is evident that the order of the AO with reference to the computation of book profits under s. 115JB was at the least a probable view and as a matter of fact the correct view to take in view of the decision of the Supreme Court in HCL (supra). It is well-settled that the law laid down by the Supreme Court is declaratory of the position as it always stood. In any event, as we have noted, the view of the AO was supported by the interpretation placed even contemporaneously in the judgment of this Court in Echjay (supra) and in the judgments of the Delhi High Court in Eicher and HCL (supra). In the circumstances, there was no warrant for reopening the assessment in exercise of the power conferred under s. 147. For all these reasons, we are of the view that the petitioner would be entitled to succeed in these proceedings. Rule. is made absolute by setting aside the notice dt. 16th July, 2008, and the order rejecting the objections of the petitioner dt. 30th Nov., 2009. There shall be no order as to costs.

[Citation : 323 ITR 54]