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TMI Blog2025 (2) TMI 1085X X X X Extracts X X X X X X X X Extracts X X X X ..... unt to a mere change of opinio
As in case of CIT vs. Kelvinator of India Ltd [2010 (1) TMI 11 - SUPREME COURT] held Assessing Officer could not have assumed jurisdiction to reopen the assessment on mere change of opinion.
Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... : * Whether the assessee should follow the notification (No.9447) issued by central government or by state government? * Should the assessee not follow the methods provided in the income tax act to determine the distance? * If the answer to question number 2 above is negative then will it make Section 2(14)(iii)(b) nugatory? * Whether the notification issued by the central government on 6.1.1994 is having no legal value? 5.7 The Jt. CIT granted opportunity of hearing to the petitioner on 22.12.2012 by issuing notice u/s 22.12.2015. The petitioner filed a detailed written submission dated 30.12.2015 before him. Thereafter, the Ld. Jt. CIT categorically passed an order dated 01.01.2016 u/s 144A of the Act and answered the questions in affirmative. Thus, learned Jt. CIT directed the AQ to accept the explanation furnished by the petitioner Thereafter, the AO appointed his authorized inspector to measure the distance who submitted a detailed report to the then AQ. Upon receipt of this report from the inspector, the AQ passed the assessment order u/s 143(3) dated 12.02.2016 without making any addition towards the impugned issue of exemption of agricultural land u/s 2(14)(iii). I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iii) of the Act. It is therefore submitted that the agriculture land being within 8 kms limit of AMC/AUDA, the income generated from sale of alleged agricultural land, is required to be taxed under the head of capital gain, which has been escaped in assessment. It is submitted that the capital gain on the income Rs. 2,81,38,500/- after allowing deduction on the indexed cost of acquisition of Rs.16,88,038/-works out to Rs. 2,64,50,462/-and the same has been escaped in assessment. Hence, it is clear that there was failure on part of the assessee to fully and truly disclose all material facts. 6. It is submitted that in the reason for reopening the Assessing Officer has categorically mentioned that he has carefully considered the assessment records containing the submissions made by the assessee in response to various notices issued during the assessment proceedings and have noted that the assessee has not fully and truly disclosed the following material facts necessary for its assessment for the year under consideration as the assessee has not furnished any evidence that proves alleged land sold during the year was located beyond 8 Kms from the municipality limits. 7. It is sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ified for the purpose of initiation of the proceedings u/s. 147 may ultimately stand altered after the hearing and while reaching the final conclusion on the basis of the intervening enquiry. It is further submitted that at the stage where AO finds a cause or justification to believe that such income has escaped assessment, the AO is not required to base his belief on any final adjudication of the matter, the AO had applied his mind and examined the information received and then recorded his reasons to believe that the income of assessee had escaped assessment for the year under consideration. 9. It is submitted that in view of the above, the AO has reasonable belief that by omission on the part of the assessee to disclose fully and truly all material facts necessary for the assessment, the income of the assessee has escaped assessment. The escapement of income was found and therefore the assessment was correctly reopened by the Jurisdictional Assessing Officer after recording the reasons of the same and by following the prescribed procedure laid down under the Income-tax Act along-with obtaining prior approval from the competent authorities. Hence, it is clear that the AO has ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reason to believe" failing which, we are afraid, Section 147 would give arbitrary powers to the Assessing Officer to re-open assessments on the basis of "mere change of opinion", which cannot be per se reason to reopen. We must also keep in mind the conceptual difference between power to review and power to re-assess. The Assessing Officer has no power to review; he has the power to re- assess. But re-assessment has to be based on fulfillment of certain pre- condition and if the concept of "change of opinion" is removed, as contended on behalf of the Department, then, in the garb of re- opening the assessment, review would take place. One must treat the concept of "change of opinion" as an in-built test to check abuse of power by the Assessing Officer....." 12. In view of the above conspectus of law, we are of the opinion that the Assessing Officer could not have assumed jurisdiction to reopen the assessment on mere change of opinion. 13. In view of the foregoing reasons, the petition succeeds and is accordingly allowed. Impugned notice dated 27.03.2021 section 148 of the Income Tax Act,1961 for A.Y. 2013-14 for reopening of assessment is hereby quashed and set aside. Rule is mad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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