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TMI Blog2024 (8) TMI 824X X X X Extracts X X X X X X X X Extracts X X X X ..... of change of opinion which is not permissible in accordance with the settled position of law. As indicated earlier, we have relied upon Mangalam Publications [ 2024 (1) TMI 1042 - SUPREME COURT] in support of the view that we take. In our opinion, it is not necessary to go into the scope and import of explanation 1 (ii) to Section 148 in the present facts and the same is left open to be examined in an appropriate case. Consequently, the petition is allowed. The impugned notice under Clause (b) of Section 148-A is quashed. Decided in favour of assessee. - M. S. KARNIK VALMIKI MENEZES, JJ. For the Petitioner : Mr. Sahish Mahambrey, Advocate. For the Respondent : Ms Amira Razaq, Standing Counsel. JUDGMENT: (PER M. S. KARNIK, J.) 1. Heard Mr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the notice has been received after a period of three years after the completion of assessment and hence, it was beyond the period of three years as mandated under Section 148 of the said Act. It was further stated that the internal audit observation and change of opinion cannot be the sole ground to issue show cause notice under Section 148-A of the said Act as there have been no new facts noticed in the audit. 6. Despite the reply, it is the case of the petitioner that the respondent is conducting the investigation and seeking queries pursuant to the notice dated 19.03.2024. Present petition is therefore filed challenging the validity of the notice dated 19.03.2024 issued under Section 148-A (b) of the said Act. 7. Ms Amira Razak, learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken up under Section 147 and notice under Section 148-A was issued to the petitioner. 9. Ms Razak further submitted that on the basis of the objection by the Internal Audit Party and pursuant to examining the records and due application of mind, notice under Section 148-A (b) of the said Act was issued to the assessee on 19.03.2024 to show cause as to why a notice under Section 148 of the said Act should not be issued and assessment reopened for the relevant Assessment Year. 10. It is submitted that the notice under Section 148-A (b) has been validly issued after examining the records pursuant to the audit objection as per Clause (ii) of the explanation 1 of Section 148 of the said Act, and since the income chargeable to tax i.e. Rs. 66,4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chargeable to tax is allowed to escape assessment by quashing the notices at this preliminary stage without any opportunity of examination by the process of reassessment. Ms Razak was at pains to point out that explanation 1 (ii) of Section 148 which has been introduced by the Finance Act 2021 with effect from 01.04.2021 supports the contentions of the respondent. 13. The rival contentions now fall for our determination. 14. The relevant portion of Section 148 which deals with the issue of notice when the income has escaped assessment reads thus:- 148 Issue of notice where income has escaped assessment. Before making the assessment, reassessment or recomputation under section 147, and subject to the provisions of section 148A, the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... *] in the case of the assessee for the relevant assessment year in accordance with the risk management strategy formulated by the Board from time to time; (ii) any audit objection to the effect that the assessment in the case of the assessee for the relevant assessment year has not been made in accordance with the provisions of this Act; or..... 15. Having perused Section 148 of the said Act extracted above, we now seek guidance from the decision of the Hon ble Supreme Court in Mangalam Publications v/s. Commissioner of Income Tax (2024) 158 taxmann.com 564 (SC), in support of our conclusions. We seek guidance from the observations made therein. Paragraph 35 reads thus:- 35. Kelvinator of India Ltd. (supra) is a case where this Court examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t cautioned that one needs to give a schematic interpretation to the words reason to believe , otherwise 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. 16. In the present case, the issue of specified bank notes having been deposited by the assessee during the demonetization period was already examined by the Assessment Officer in his Order dated 31.12.2019. The Assessment Officer was alive to the fact that only specified businesses such as hospitals, gas agencies etc. were allowed to transact with the demonetized cash. he Assessing Officer has accepted the income returned by the Assessee after examining the records produ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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