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2011 (8) TMI 655 - AT - Income TaxRe-assessment under 147 - Change of opinion - Intimation under 143(1) - deduction claimed under 35D was restricted to 3,43,138 - Revenue appealed before Commissioner and thereafter Tribunal, however appeal was turned down both the times - in later years notice under 148 issued - Held That:- Reason has been clearly stated by the assessing authority that the quantum of relief claimed by the assessee under section 35D was not correct as claimed.The fact that for certain assessment years the issue has been decided by the Commissioner of Income-tax (Appeals) in assessee's favour cannot be a better to the Assessing Officer in exercising his jurisdiction under section 147. Thematic interpretation of the words 'reason to believe' - held that:- The thematic interpretation of the words 'reason to believe' should not be unreasonable. Judicial pronouncements have almost unanimity in their view that the reason needs to be a 'prima facie reason' to believe that income has escaped assessment. The assessing authority need not have a conclusive view that income has escaped assessment so as to initiate the reassessment proceedings. The final view will emerge only on conclusion of the reassessment, or after considering the objections raised by the assessee. What is necessary to reopen an assessment is not the final verdict but a prima facie reason. Expenditure in respect of exempt income - applicability of proviso to 14A - Held That:- By majority it was held that Notice under 148 was issued to make assessment of expenses under 35D, therefore Assessing Officer is justified in dealing with the issue arising under section 14A as well.
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