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2020 (8) TMI 896 - AT - Income TaxReopening of assessment u/s 147 - disallowance of depreciation and disallowance of expenditure incurred for increase of capital respectively - HELD THAT:- AO has passed the original assessment order after taking into consideration each and every detail/explanation furnished by the assessee in response to the notice issued or query raised by him during the course of assessment proceedings. It can further be concluded that the AO had no tangible material for forming the belief that the income of the assessee has escaped assessment. Hence, in our considered opinion since the AO has initiated the reassessment proceedings on the basis of the material already placed on record by the assessee during assessment proceedings, the action of the AO amounts to change of opinion which is not permissible under law. In the case of CIT vs. Kelvinator of India Ltd [2010 (1) TMI 11 - SUPREME COURT] has held that post 01-04-1989, power of AO to reopen u/s 147 is much wider, however, the AO has no jurisdiction to reopen assessment on the basis of mere change of opinion. Powers u/s 147 of the Act can be exercised by the AO provided there is tangible material to come to the conclusion that there is escapement of income from assessment. In our considered view, the AO had no tangible material to come to the conclusion that income of the assessee has escaped assessment. Thus we hold that since the AO had initiated reassessment proceedings in the present case on the basis of change of opinion, the Ld. CIT(A) has wrongly upheld the action of the AO. We, therefore, allow the legal ground raised by the assessee and set aside the order passed by the Ld. CIT(A) holding the notice u/s 148 read with section 147 of the Act and the subsequent proceedings as void ab initio.- Decided in favour of assessee.
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