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TMI Blog2014 (10) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... rayon yarn, viscose tyrecord, caustic soda, carbon-di-sulphide, sulphuric acid, salt and by products, cement, pulp & paper, etc., and it also renders engineering services and engaged in floriculture business. It has filed its return of income under normal provisions of the Act at Rs. 280,37,62,316 and book profit of Rs. 355,48,54,200, under section 115JB, on 31st October 2007, under section 139(1). The assessee's case was selected for scrutiny and in pursuance thereof, assessment order under section 143(3), was passed on 5th May 2009 at an income of Rs. 311,72,96,159, under normal provisions. In the return of income, the assessee had claimed deduction under section 80IC, of Rs. 33,67,42,837, in respect of paper and pulp unit on the basis of audit report in form 10CCA. During the course of the assessment proceedings, the Assessing Officer has raised specific queries regarding claim made under section 80IC, in response to which the assessee had filed detail submissions vide letter dated 23rd March 2009, and then again on further query the assessee vide letter dated 30th March 2009, clarified and substantiated its claim. After considering the entire submissions and material place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r assessment order. Various case laws were also relied upon. However, the Assessing Officer vide letter dated 28th October 2011, has rejected assessee's objection after relying upon the decision of the Hon'ble Andhra Pradesh High Court in K.C.P. Limited v/s ITO, [1984] 146 ITR 284 (A.P) and the decision of the Hon'ble Delhi High Court in Consolidated Photo Finvest Ltd. v/s ACIT, [2006] 281 ITR 394 (Del.) . After rejecting the assessee's objection, he proceeded to complete the assessment after disallowing the claim of deduction under section 80IC, by further sum of Rs. 4,99,15,893, vide order dated 22nd December 2011, passed under section 147 / 143(3). As a result, the assessed income was enhanced to Rs. 316,72,12,050, under normal provision. Again before the learned Commissioner (Appeals), the assessee challenged the validity of re-assessment on the ground of "change of opinion" after relying heavily upon the decision of the Hon'ble Supreme Court in CIT v/s Kelvinator of India Ltd. [2010] 320 ITR 561 (SC). The assessee's submissions in this regard has been incorporated by the learned Commissioner (Appeals) from Pages-4 to 6 of the appellate order. The learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al High Court in Asteroids Trading and Investments P. Ltd. v/s DCIT, [2009] 308 ITR 190 (Bom.). 7. The learned Departmental Representative, on the other hand, submitted that in the original assessment order, the Assessing Officer has wrongly allowed the claim of deduction under section 80IC on "other income" , which is admittedly not allowable in view of the provisions of section 80IC, as the other income cannot be held to be derived from the industrial undertaking. Once the Assessing Officer has failed to examine the claim from this perspective, then it cannot be held that he has formed an opinion on this issue. Such an omission by the Assessing Officer in the original assessment order cannot preclude the Assessing Officer for re-opening the assessment under section 147, if it falls within the period of four years from the end of the relevant assessment year. He thus strongly relied upon the reasoning given by the learned Commissioner (Appeals) in the impugned order. 8. We have heard the rival contentions, perused the relevant findings of the authorities below and the material available on record on the issue of validity of re-opening under section 147. Admittedly, in this case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the assessee's claim for Rs. 3,36,74,837. Such an order was also subject matter of the scrutiny by the learned Commissioner (Appeals) which has been confirmed. Thus, it cannot be held that the Assessing Officer had not formed any opinion while examining the claim of deduction under section 80IC. 9. It is now a trite law that "change of opinion" preclude the reopening of the assessment, whether within or outside the four years' limit from the end of the relevant assessment year. The Hon'ble Supreme Court in Kelvinator of India Ltd. (supra), has held that there is conceptual difference between power to review and power to re-assess. The Assessing Officer has though power to re-assess but no power to review and if the concept of "change of opinion" is removed, then in the garb of the re-assessment, review of earlier orders would take place. The "change of opinion" is in-built test to check the abuse of power by the Assessing Officer. Thus, in such cases, the Assessing Officer can re-open the case only when there is "tangible material" coming on record having direct bearing with the escapement of income. The "reason to believe" must have live link nexus with the format ..... X X X X Extracts X X X X X X X X Extracts X X X X
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