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TMI Blog2022 (3) TMI 1361X X X X Extracts X X X X X X X X Extracts X X X X ..... sistant Director of Income Tax (Inv.), Unit-3 (3), Kolkata, the assessing officer has conducted an investigation, has gone through the income tax return and other related documents of the assessee and has observed that the assessee is a beneficiary of receiving bogus accommodation entries and he has found a reason to believe that the income has escaped assessment in respect of the assessee, we do not find any force in the submission made on behalf of the petitioner that the assessing officer has acted on a report of the Assistant Director of Income Tax (Inv.), Unit-3 (3), Kolkata and he has not recorded his own reasons to believe, and thus the same is rejected. When we examine the facts of the present case keeping into view the scope of power of judicial review while scrutinizing a notice issued under Section 148 of the Act as explained in Raymond woolen Mills Ltd. [ 1997 (12) TMI 12 - SUPREME COURT ] and Phool Chand Bajarang Lal [ 1993 (7) TMI 1 - SUPREME COURT ] , we find that the notice under Section 148 of the Act has been issued by the assessing officer after conducting an investigation and going through the income tax return and other related documents of the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r reply filed on 04.06.2019 and the Income Tax Officer accepted the submissions of the petitioner made in her reply and dropped the proceedings. 4. On 31.03.2021, the ACIT issued the impugned notice under Section 148 of the Act to the petitioner in respect of the assessment year 2015-16 stating that he had reason to believe that the petitioner's income chargeable to tax for the said assessment year has escaped assessment within the meaning of Section 147 of the Act. On 10.04.2021, the petitioner asked for being provided with the reasons for re-opening of the assessment. The petitioner's contention is that the ACIT required her to file a return in compliance of the notice dated 31-03-2021 under Section 148 of the Act and only then the reasons for re-opening of the assessment would be supplied to her. On 31.03.2021, the petitioner filed a return in compliance to the aforesaid notice dated 31-03-2021 under Section 148 of the Act before Income Tax Officer-3 (5), Lakhimpur Kheri. On 01.06.2021, the ACIT supplied a copy of the approval under Section 151 of the Act containing the reasons for initiating the proceedings under Section 147 read with Section 148 of the Act and als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice to the petitioner under Section 133 (6) of the Act on the above transaction relating to shares. The petitioner had submitted a written reply alongwith the relevant evidences and after examining the same, the Income Tax Officer-3 (5), Lakhimpur Kheri had disposed of his notice/inquiry by recording submission of the assessee is accepted. Hence, no action is required in this case . No other factual point was raised by the petitioner in her objections and besides the aforesaid sole factual objection, the petitioner relied upon certain case laws and submitted that re-assessment without any additional information would amount to change of opinion and a mere change of opinion does not empower the Assessing Officer to re-open the assessment. The petitioner requested for dropping the proceedings under Section 148 of the Act. 9. On 02.09.2021, the ACIT, Sitapur-New has passed an order rejecting the petitioner's objection against initiation of re-assessment proceedings which order has been challenged by the petitioner by filing this writ petition. 10. We have considered the submissions made by Shri Suyash Agrawal and Ms. Surangama Sharma, learned counsel for the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been filed as Annexure No. 3 to the Writ Petition. It does not bear any number, date or the official seal of the authority who has purportedly passed the order so as to inspire even a prima facie confidence regarding its genuineness. Moreover, it would be no bar against issuance of a notice under Section 148 of the Act, provided the requisite conditions exist. 17. The reason for issuing the notice under Section 148 of the Act is that during investigation, the Assessing Officer has gone through the income tax return and other related documents of the assessee and has found that the M/s KCGP Share Broking Service Pvt. Ltd. has been used to provide bogus accommodation entries to various beneficiaries. The assessee is one of the beneficiaries of M/s KCGP Share Broking Services Pvt. Ltd., which is engaged in providing accommodation entries to the beneficiaries. The assessee is a beneficiary of receiving bogus accommodation entries to the tune of ₹ 6,94,540/-. The ACIT has expressed the view that the assessee has introduced her own undisclosed income in her books of account by way of accommodation entries by showing artificial transactions to make the same valid transaction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds change of opinion imply formulation of opinion and then a change thereof. In terms of assessment proceedings, it means formulation of belief by an assessing officer resulting from what he thinks on a particular question. It is a result of understanding, experience and reflection. 17. It is well settled and held by this Court in a catena of judgments and it would be sufficient to refer to CIT v. Kelvinator of India Ltd. wherein this Court has held as under: (SCC p. 725, para 5-7) 5. where the assessing officer has reason to believe that income has escaped assessment, confers jurisdiction to reopen the assessment. Therefore, post-1-4-1989, power to reopen is much wider. However, one needs to give a schematic interpretation to the words reason to believe . Section 147 would give arbitrary powers to the assessing officer to reopen assessments on the basis of mere change of opinion , which cannot be per se reason to reopen. 6. We must also keep in mind the conceptual difference between power to review and power to reassess. The assessing officer has no power to review; he has the power to reassess. But reassessment has to be based on fulfilment of certain p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 of the Act. He has placed reliance on a judgment of this Court in Indra Prastha Chemicals Pvt. Ltd. and others Versus Commissioner of Income-Tax and another , 2004 (271) ITR 113 = 2004 SCC OnLine All 2133, wherein it has been held that: - 9. Under section 147 of the Act the proceedings for the reassessment can be initiated only if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year. The question whether the Assessing Officer had reasons to believe is not a question of limitation only but is a question of jurisdiction, a vital thing, which can always be investigated by the court in an application under article 226 of the Constitution as held in Daulatram Rawatmal v. ITO , [1960] 38 ITR 301 (Cal); Jamna Lal Kabra v. ITO , [1968] 69 ITR 461 (All); Calcutta Discount Co. Ltd. v. ITO , [1961] 41 ITR 191; C.M. Rajgharia v. ITO , [1975] 98 ITR 486 (Patna) and Madhya Pradesh Industries Ltd. v. ITO , [1965) 57 ITR 637 (SC). (Emphasis supplied) 24. A perusal of the reasons recorded by the assessing officer shows that after considering the report of the Assistant Director of Income Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on account of the omission of the assessee to make a full and true disclosure of the primary facts was relevant, reliable and specific. It was not at all vague or non-specific. ... 25. From a combined review of the judgments of this Court, it follows that an Income Tax Officer acquires jurisdiction to reopen assessment under Section 147( a ) read with Section 148 of the Income Tax Act, 1961 only if on the basis of specific, reliable and relevant information coming to his possession subsequently, he has reasons which he must record, to believe that by reason of omission or failure on the part of the assessee to make a true and full disclosure of all material facts necessary for his assessment during the concluded assessment proceedings, any part of his income, profit or gains chargeable to income tax has escaped assessment. He may start reassessment proceedings either because some fresh facts come to light which were not previously disclosed or some information with regard to the facts previously disclosed comes into his possession which tends to expose the untruthfulness of those facts. In such situations, it is not a case of mere change of opinion or the drawing of a di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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