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2019 (1) TMI 1214 - HC - Income TaxValidity of reassessment proceedings - assessee had claimed deduction of profit derived from such export business in terms of Section 10B - tribunal came to the conclusion that the issue was examined during the original scrutiny assessment and therefore, could not be subject to reassessment proceedings - Held that - We are in agreement with the view taken by the Tribunal. The Tribunal has correctly placed reliance on a decision of the Supreme Court in the case of CIT Vs. Kelvinator of India Ltd 2010 (1) TMI 11 - SUPREME COURT OF INDIA holding that even post amendment in Section 147 of the Act w.e.f. 1.4.1989, the concept of change of opinion would continue to apply. In the present case, the Assessing Officer had examined entire claim of deduction under Section 10B of the Act. This included the claim made by the assessee to another EOU. This element of the claim was also examined by the Assessing Officer as can be seen from the above quoted portion of assessment order. Any attempt on his part to disallow the claim would now be based on mere change of opinion. No question of law.
Issues:
Validity of proceedings for reassessment under Section 147 of the Income Tax Act, 1961. Analysis: The judgment concerns an appeal filed by the Revenue challenging the decision of the Income Tax Appellate Tribunal (ITAT) dated 21.11.2014. The primary issues presented for consideration by the High Court include whether the Tribunal was correct in quashing the proceedings initiated by the Assessing Officer under Section 147 of the Income Tax Act, 1961. Another issue was whether the Tribunal erred in not appreciating certain judgments of various High Courts regarding the reopening of assessments under Section 147 of the Act based on orders of superior courts and tribunals. The case revolved around the respondent-assessee, a 100% Export Oriented Unit (EOU), for the assessment year 2007-08. The assessee had claimed a deduction of profits derived from export business under Section 10B of the Act. The Assessing Officer sought to disallow a part of this claim related to the sale of goods to another EOU during the reassessment process. However, the Tribunal held the reassessment notice invalid, stating that the claim had already been examined during the original assessment proceedings under Section 143(3) of the Act. The High Court concurred with the Tribunal's decision, citing the principle established in the Supreme Court case of CIT Vs. Kelvinator of India Ltd (2010) 320 ITR 561 (SC) that the concept of change of opinion continues to apply post-amendment in Section 147 of the Act. The Assessing Officer had thoroughly examined the deduction claim under Section 10B during the original assessment, including the claim related to sales to another EOU. Therefore, any attempt to disallow the claim during reassessment would amount to a mere change of opinion. In conclusion, the High Court dismissed the Tax Appeal, stating that no question of law arose from the case. The decision was based on the principle that the Assessing Officer's attempt to disallow the claim during reassessment was a result of a change of opinion, which was not permissible under the law. This detailed analysis of the judgment highlights the issues related to the validity of reassessment proceedings under Section 147 of the Income Tax Act, 1961, and the court's interpretation of the law in light of the specific facts of the case.
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