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TMI Blog2022 (10) TMI 757X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above letter, it is clear that before reopening the case, the AO had no any new tangible materials and the AO has referred to the computation of taxable income which was already available during the course of assessment completed u/s 143(3) of the Act. It means it is complete change of opinion by the AO, which is not tenable in the eye of law. AO reopened assessment on mere ground that expenditure incurred by assessee-company, for renovation of hotel expenses and rates and taxes claimed as FBT payable, since said reason for reopening was based on same set of information which was available at time of original assessment proceedings, , therefore, reopening of assessment based on a mere change of opinion is invalid and not permissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by the Revenue are as under:- 1. Whether the learned CIT(A) was correct in law and in facts in holding that a part of the renovation expenses incurred by the assessee on the Unit Hotel Harsha can be held to be current repair in nature which is against the ratio laid down by the Hon'ble Supreme Court of India in the case of Ballimal Naval Kishore (1997) 224 ITR 414(SC)? 2. The Appellant craves leave to alter , amend or delete the above grounds of appeal or add any other grounds of appeal 4. The assessee challenged the reopening of the case after issuing notice u/s 148 of the Act and the revenue challenged the deletion of addition made by the AO on account of renovation charges incurred by the assessee in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowable expenditure an amount of Rs.4,76,05,398/- as Hotel Harsh renovation expenses. Even though, the loss Rs.1,10,48,523/- was considered while computing the taxable income, the AO added to the entire claimed of renovation expenses of Rs.4,76,05,398/- into the income of the assessee. Further, the AO observed from the 147 proceedings that assessee company under rates and taxes had claimed an amount of Rs.20,39,464/- as Fringe Benefit Tax (FBT). However, while computing taxable income of the assessee, it was not added back into the total income of the assessee. Hence, the AO added into the total income of the assessee in the reopening proceedings and completed the reassessment u/s 143(3)/147 on 31/07/2014. 7. Aggrieved from the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en obtained as per sec. 151(1)(ii) and notice 143(2) has been issued to the assessee before completion of reassessment proceedings. In support of his argument he relied on the following judgments:- ACIT others Versus M/s. ICICI Securities Primary Dealership Ltd (2012) 348 ITR 299 (SC) CIT Versus M/s. Usha International Ltd ITA 1961, S 147; (2012) 348 ITR 485 (Delhi FB) CIT Versus M/s. Kelvinator of India Ltd (2010) 320 ITR 561 (SC) CIT Versus M/s. Rex Talkies (1984) 148 ITR 560 (Karnataka HC) 11. He also submitted that the copy of the reasons was not provided to the assessee during the course of reassessment proceedings, whereas the letter was written to the AO and reasons has been recorded after issuance of notice u/s 148 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -12(4)/2014-15, the contention of the letter is as under:- 14. On perusal of the above letter in which the contents of the reasons for reopening has been mentioned, the copy of reasons were provided to the AR of the assessee, which is clear from the reassessment order. Therefore, we reject the contention of the ld.AR that the reason for reopening was recorded after issuance of notice u/s 148 of the Act. On observation of the above letter, it is clear that before reopening the case, the AO had no any new tangible materials and the AO has referred to the computation of taxable income which was already available during the course of assessment completed u/s 143(3) of the Act. It means it is complete change of opinion by the AO, which i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eason for reopening was based on same set of information which was available at time of original assessment proceedings, , therefore, reopening of assessment based on a mere change of opinion is invalid and not permissible under the law. 16. We do not find substance on the submission of ld.DR on this issue. Further, on other legal issues that the assessee could not produce substantial evidence for deciding the issues. Since we have quashed the reopening of the reassessment on the basis of change of opinion, therefore, the entire reassessment order does not survive. Accordingly, the appeal of the revenue also does not survive. 17. In the result, the grounds raised by the assessee is partly allowed and the appeal of the Revenue is dismi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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