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TMI Blog2017 (3) TMI 982X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court : The income tax return filed by the petitioner under section 143(1) of the Income Tax Act, 1961 for the assessment year 2006-2007 was duly processed by determining a net amount of ₹ 31,132/- required to be paid by the petitioner. Subsequently, the case was selected for scrutiny and a notice sub-section 2 of section 143 was issued upon the petitioner. The petitioner was directed to attend the office of the assessing officer with all relevant documents, accounts and other evidence which he intended to rely in support of his disclosure of the facts in the return submitted to the officer. It is not in dispute that the scrutiny proceeding was disposed of by the assessing officer enhancing the liability of the petitioner from ₹ 31,132/- to ₹ 1,09,210/-. It is undisputed that the petitioner complied the said order and deposited the amount so determined. A notice under section 148 of the Act was again issued upon the petitioner seeking to reopen the assessment for the said assessment year which was challenged by the petitioner in a writ petition being WP No. 382 of 2010 before this Court. It would be apposite to narrate the excerpt from the said notice whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the light of the day. Before proceeding further, this Court feels that sections 147 and 148 of the Act are required to be narrated which reads thus :- S.147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned [hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year]: Provided that where an assessment under sub-section [3] of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eassessment or recomputation as specified in sub-section [2] of section 153, every such notice referred to in this clause shall be deemed to be a valid notice. On the meaningful conjoint reading of the aforesaid provisions it is manifest that the Assessing Officer may assess or reassess if he has a reason to believe that any income chargeable to tax has escape assessment which comes to the notice subsequently in course of the proceeding. Once the assessing officer arrives at the decision, he is required to serve a notice under section 148 upon assessee to furnish all the materials and documents indicated in the said notice. What transpires from the writ petition as well as from the objection filed by the respondents are that the Assessing Officer was not convinced with the audit objection and categorically signifies his inability to accept the same. The matter was placed before the CIT as per the omnivorous direction of the CBDT and it is the CIT who suddenly formed an opinion that the assessment should be reopened and directed the Assessing Officer to issue notice upon the assessee petitioner under section 148 of the Act. The point emerges from the aforesaid undisputed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The Audit Report merely gives an opinion with regard to the non-availability of the deduction both under section 80-IA and under section 80HHC and that the deduction under section 80-IA was not deducted from the profits of the business while computing deduction under section 80HHC. Clearly, therefore, there was no new or fresh material before the Assessing Officer except the opinion of the revenue Audit Party. 10. Since it is settled law that mere change of opinion cannot form the basis for issuing of a notice under section 147/148 of the Act, therefore, we do not propose to burden our judgement with the said judgements. In fact, as stated above, the counsel for the revenue does not dispute this principle of law. There is no other judgement cited by the respondents taking the other view than in case cited above. The respondents have proceeds to argue on the point that the writ petition challenging the notice after filing the objection is not maintainable and placed reliance upon judgement of the Madras High court in case of Tamil Nadu Petroproducts Ltd. Vs. Commissioner of Income-Tax and Another reported in [2011] 330 ITR 342. The aforesaid judgement does not relate t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e audit objection may be treated as an escapement or the suppression of the material fact being the ingredients engrafted under section 147 of the Act. None of those factors have been considered by the Assessing Officer who simply proceeded to hold that there is a gulf of difference between the change of opinion and the erroneous nature of the earlier assessment on detection of mistakes. This Court finds that the decision rendered in case of Carlton (supra) squarely applies in the instant case and none of the decisions cited by the respondents have taken a contrary view to the same. So far as the other point is concerned, indubitably the assessing officer did not accept the audit objection warranting the assessment under section 147 of the Act. The matter was placed before the CIT who suggested that the assessment must be reopened under section 147 and consequently direction was passed upon the Assessing Officer to cause a notice under section 148 of the Act and proceed to reassess. There is no hesitation in my mind that the Assessing Officer simply acted on the dictate of his superior officer without applying his/her mind to the cause for which the proceeding was initiated. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Court. In the course of the judgement, Gajendragadkar C.J., speaking for the Court, observed thus:- In reaching this conclusion, we have been influenced by certain other considerations which are both relevant and material. In interpreting s. 43-A, we think, it would be legitimate to assume that the legislature intended to respect the basis and elementary postulate of the rule of law, that in exercising their authority and in discharging their quasi judicial function, the tribunals constituted under the Act must be left absolutely free to deal with the matter according to their best judgement. It is of the essence of fair and objective administration of law that the decision of the Judge or the Tribunal must be absolutely unfettered by any extraneous guidance by the executive or administrative wing of the State. If the exercise of discretion conferred on a quasi judicial tribunal is controlled by any such direction, that forges fetters on the exercise of quasi judicial authority and the presence of such fetters would make the exercise of such authority completely inconsistent with the well-accepted notion of judicial process. It is true that law can regulate the exercise of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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