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Issues involved: Challenge to notice u/s 148 for reassessment of income u/s 80HHC deduction for assessment year 1994-95.
Facts: The petitioner, an Export House engaged in manufacturing, claimed Rs. 3.08 crores deduction u/s 80HHC in its income tax return for 1994-95. Assessment completed disallowed revised claim of Rs. 3.20 crores but allowed original claim. Appeal directed reconsideration of revised claim. Notice u/s 148 issued alleging escaped income due to excessive relief claimed. Arguments: Assessee's counsel argued against reopening based on change of opinion post original assessment. Department's counsel cited Explanation 2 to section 147, claiming excessive relief due to ignoring losses in computing net profits u/s 80HHC(3)(c). Findings: Court upheld Department's case, finding impugned notice issued within 4 years and assessee obtained excessive relief by ignoring losses in net profit calculation u/s 80HHC(3)(c). Assessing Officer's belief for reassessment found rational and based on grounds. Previous judgments cited by assessee found inapplicable to present case. Court emphasized on the objective nature of "reason to believe" requirement. Conclusion: Writ petition dismissed, no merit found, and costs not awarded. Judgment: High Court Bombay upheld the Department's reassessment notice u/s 148 for assessment year 1994-95, finding the belief rational and based on grounds, dismissing the writ petition challenging the notice.
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