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TMI Blog2015 (8) TMI 1161X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of ld.CIT(A)-XXXVI, Kolkata in Appeal No.320/CIT(A)-XXXVI/Kol/Cir.-2,Mid./2011-12 dated 31.07.2013. Assessment was framed by D.C.I.T., Circle-2, Midnapore u/s 147/143(3) of the Income Tax Act, 1961 (hereinafter referred to as the act ) for A.Yr. 2006-07 vide its order dated 20.12.2011. 2. The only issue to be decided in this appeal is as to whether the ld. CIT(A) is right in confirming the assumption of jurisdiction u/s 147 of the Act in the facts and circumstances of the case and accordingly right in confirming the disallowance of ₹ 4,76,218/- toward transportation charges made by the ld. AO in the re-assessment proceedings. 3. The brief facts of the case are that original assessment for A.Y.2006-07 was completed u/s 143(3) of the Act by the ld. AO and the said assessment was sought to be reopened by issuance of notice u/s 148 of the Act on 12.05.2010. The assessee had claimed transportation charges of ₹ 7,80,475/- as deduction in the return for A.Y.2006-07 and out of this, it was found that a sum of ₹ 4,76,218/- representing payments were made by the assessee to four parties in excess of ₹ 50,000/- per annum without deducting of tax at source. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... already framed in the original scrutiny assessment proceedings and in support of this, he relied on the various judicial decisions. He also informed that the reopening was done within four years from the end of the relevant assessment year. 7. In response to this, the ld. DR vehemently supported the orders of the lower authorities. 8. I have heard the rival submissions. It is seen that in the original scrutiny assessment, the question regarding transportation charges were raised by the ld. AO. The same were duly replied by the assessee. These facts are not disputed by the department and are also mentioned in pages 11 and 12 of the ld.CIT(A) s order which are extracts of order sheet entries of the assessment records. The ld. AO based on the query raised regarding transportation charges and replies filed thereon by the assessee resorted not to make any addition in this regard in the original assessment u/s 143(3) of the Act. This indicates formation of an opinion and application of mind by the ld.AO. There is no doubt or dispute as to the fact in the instant case that there is no tangible material available with the ld. AO to justify the impugned action and restoring to reopen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... them, including particular entries in the accounts books, particular portion of documents, documents and other evidences which could have been discovered by the assessing authority from the documents and other evidences disclosed. The duty however did not extend beyond the full and truthful disclosure of all primary facts. Once all the primary facts are before the assessing authority, it is for him to decide what inferences of fact can be reasonably drawn and what legal inferences have ultimately to be drawn. It is not for somebody else far less the assessee to tell the assessing authority when inferences, whether of fact or of law, should be drawn. 8.1. It is pertinent to go into the judicial decision on the impugned subject:- (a) CIT vs Kelvinator India Limited (2010) 310 ITR 561 (SC) (confirming CIT vs Kelvinator of India (2002) 256 ITR 1 (Delhi)(FB). J.Kapadia held that the concept of change of opinion must have treated as an inbuilt test to check the abuse of power by AO and that the reasons must have a live link with the formation of belief. Important extracts of the decision is reproduced herein below :- However, one needs to give schematic interpretati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 143 or sub-section (3) of 143. When a regular order of assessment is passed in terms of sub-section (3) of section 143 a presumption can be raised that such an order has been passed on application of mind. It is well known that a presumption can also be raised to the effect that in terms of clause (e) of section 114 of Indian Evidence Act, 1872, judicial and Official Acts have been regularly performed. If it be held that an order which has been passed purportedly without application of mind would itself confer jurisdiction upon the AO to reopen the proceeding without anything further, the same would amount to giving a premium to an authority exercising quasi judicial function to take benefit of its own wrong. (b) In CIT, Burdwan vs Pioneer cable Network in ITAT No.151 of 2014 dated 29.10.2014, in the decision rendered by the Jurisdictional Calcutta High Court, the question raised by the revenue before the court is as follows :- Whether on the facts and in the circumstances of the case the Tribunal was justified in law, in deciding the appeal holding that it has a change of opinion ignoring the fact that the AO had not, based on materials availing to him taken a v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tween two officers in reopening the assessment and it is not legally permissible. We, therefore, do not find any infirmity and illegality in the impugned judgment and order dated 12th January, 2012 passed by the learned Tribunal. Since in this case, a regular assessment was made u/s 143(3) of the Act, presumption can be drawn that such an order has been passed on application of mind and the subsequent action of the AO is nothing but a change of opinion. (f) In ACIT vs ICICI Securities Primary Dealership Ltd. (2012) 248 ITR 299 (SC) dated 22.08.2012. the Apex Court in Civil Appeal No.5960 of 2012 has held as under :- Leave granted. We have heard counsel on both sides. The appellant had disclosed full details in the Return of Income in the matter of its dealing in stocks and shares. According to the assessee, the loss incurred was a business loss, whereas according to the revenue, the loss incurred was a speculative loss. Rejection of the objection of the assessee to reopening of the assessment by the AO vide his order dated 23.06.2006, is clearly a change of opinion. In the circumstances, we are of the view that the order reopening the assessment was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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