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TMI Blog2024 (3) TMI 665X X X X Extracts X X X X X X X X Extracts X X X X ..... h tangible material coming to the knowledge of the AO and the reopening of assessment is purely on a re-examination of the very same material on the basis of which the original assessment order was passed. It is a well settled principle of law that an AO has no power to review and this power is not to be confused with the power to re-assess. The Apex Court in Commissioner of Income Tax, Delhi v. Kelvinator of India Ltd. ( 2010 (1) TMI 11 - SUPREME COURT] has reiterated that mere change of opinion cannot be a ground for reopening concluded assessment. AO without appreciating the true import of the decision of RAJESH JHAVERI STOCK BROKERS P. LIMITED [ 2007 (5) TMI 197 - SUPREME COURT] continue to reopen assessments on the ground of income having escaped assessment despite the fact that all the material and information was already available with him while passing the original assessment order. Furthermore, while conclusive proof of escapement of income may not be necessary to reopen an assessment, the least that is required is a requisite belief based on tangible material which was not accessible to the AO or that which was deliberately withheld by Assessee, which then would amount to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cialty products. 4. Petitioner filed its return of income for the AY 2017-18 on 30th November 2017 declaring total income of Rs. 1043,79,64,000/- and made a disallowance of an amount of Rs. 15,27,42,467/- being the CSR amount in consonance with Explanation 2 to Section 37 of the Act. An amount of Rs. 6,18,60,803/- (being 50% of the aggregate donation) was deducted and claimed under Section 80G of the Act. This amount was donation in respect of approved trusts/institutions, for the purposes of Section 80G of the Act. The details of the donations were given in the computation of income, which formed part of the return of income. 5. Petitioner s return of income was selected for scrutiny. Pursuant to initiation of assessment proceedings, notices dated 5th April 2019 and 12th September 2019 were issued under Section 142(1) of the Act seeking details along with supporting evidence including copy of the audit report in respect of the claim of deduction. Petitioner replied by letter dated 15th April 2019 explaining that no deduction was claimed by it. Another notice dated 12th September 2019 under Section 142(1) of the Act was issued asking Petitioner to file a detailed note, supporting d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ointing out the following: (i) Petitioner has not claimed the deduction of CSR expenses as business expenditure. (ii) Section 80G of the Act has no condition that such deduction shall not be allowed in respect of amounts spent out of CSR. (iii) The AO has formed his belief regarding escapement of income based on an audit objection without an independent application of mind and had earlier refused to accept the audit objection. (iv) Petitioner had made adequate disclosure regarding expenditure by way of CSR and deduction under Section 80G of the Act is made in the annual accounts, the tax audit report, the computation of income which was already considered by the AO while passing the original assessment order. Deduction under Section 80G of the Act was specifically mentioned in the computation sheet which formed the part of the assessment order. Therefore, it was a clear case of change of opinion . On this issue, queries were raised during the assessment proceedings and Petitioner replied thereto. Therefore, this issue was subject of consideration during the assessment proceedings. (v) The satisfaction of the Sanctioning Authority has not been provided to Petitioner which indicates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cuments. It is also seen that Petitioner has claimed deduction for eligible donation as detailed in Schedule. We agree with Mr. Pardiwalla s submission that as far as donations given to eligible trust is concerned, it would still qualify as deduction under Section 80G of the Act even if the contribution is out of the CSR funds. The AO has examined all these aspects while passing the original assessment order. 13. The documents on record also indicate that the Audit Wing of the Department raised certain objections to the original assessment order including the issue of deduction under Section 80G of the Act. It is seen that the AO justified the original assessment order to the audit party without accepting any adjustment to the same. 14. The notice providing the reasons to believe itself is based on verification of the profit and loss account and computation of income showing the amount of CSR expenses debited under the head other expenses and the said amount being added back and claimed as deduction under Chapter VA as donation. The notice further goes on to say that during the course of original assessment proceedings, neither the AO has asked for any details and information on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eptual 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 precondition and if the concept of change of opinion is removed, as contended on behalf of the Department, then, in the garb of reopening the assessment, review would take place. 7. One must treat the concept of change of opinion as an in-built test to check abuse of power by the assessing officer. Hence, after 1-4-1989, the assessing officer has power to reopen, provided there is tangible material to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief . 17. Similarly, as held by this Court in Aroni Commercials Limited v. Deputy Commissioner of Income Tax 2(1) (2014) 44 taxmann.com 304 (Bombay)., once a query is raised during the assessment proceedings and Assessee has replied to it, it follows that the query raised was a subject of consideration of the AO while completing the assessment. It is also not necessary that an assessment order should contain reference and/or discussion to disclose its satisf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n it would be impossible for the Assessing Officer to complete all the assessments which are required to be scrutinized by him under Section 143(3) of the Act. Moreover, one must not forget that the manner in which an assessment order is to be drafted is the sole domain of the Assessing Officer and it is not open to an assessee to insist that the assessment order must record all the questions raised and the satisfaction in respect thereof of the Assessing Officer. The only requirement is that the Assessing Officer ought to have considered the objection now raised in the grounds for issuing notice under Section 148 of the Act, during the original assessment proceedings. There can be no doubt in the present facts as evidenced by a letter dated 8 September 2012 the very issue of taxability of sale of shares under the head capital gain or the head profits and gains from business was a subject matter of consideration by the Assessing Officer during the original assessment proceedings leading to an order dated 12 October 2010. It would therefore, follow that the reopening of the assessment by impugned notice dated 28 March 2013 is merely on the basis of change of opinion of the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isclosed by Petitioner. It is thus a clear case of change of opinion by the AO. The notice of reopening assessment does not by any measure disclose any material leave aside any information leading to formation of cogent and requisite belief. The finding of the Apex Court in Rajesh Jhaveri (supra) must not be used by AO to reopen assessments to review the original assessment order on the basis of a change of opinion of the AO, as done in the present case. Further, the reasons to believe notice itself indicates that the AO was already seized with information prior to passing of the original assessment order and as such, there is no tangible information on the basis of which he has allegedly formed the requisite belief. 20. In these circumstances, we have no hesitation in holding that the notice dated 27th March 2021 under Section 148 of the Act in respect of income having escaped assessment and the order dated 21st December 2021 passed by the AO rejecting the objections of Petitioner impugned herein, are untenable and cannot be sustained in law. The Petition is allowed. 21. Rule is made absolute in terms of prayer clause (A) which reads as under: A. that this Hon'ble Court may be ..... 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