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2022 (1) TMI 436 - HC - Income TaxValidity of Reopening of assessment u/s 147 - Eligibility of reasons to believe - change of opinion - HELD THAT:- Once a query is raised during the assessment proceeding and the assessee has replied to it, it follows that the query raised was a subject for consideration of the Assessment Officer while completing the assessment. It is not necessary that an assessment order should contain reference and/or discussions to disclose its satisfaction in respect of the query raised. There can be no doubt that in the present facts, the five points mentioned was a subject matter of consideration by the AO during the original assessment proceeding leading to an order dated 17th March, 2006. It would, therefore, follow that the reopening of the assessment by the impugned notice dated 26th March, 2008 is merely on the basis of change of opinion of the Assessing Officer from that held earlier during the course of assessment proceeding leading to the order dated 17th March, 2006. This change of opinion does not constitute justification and/or reasons to believe that the income chargeable to tax has escaped assessment. We have to also add that item No. 5 in the reasons noted above includes item No. 3 mentioned earlier. Moreover, in the assessment order a sum of ₹ 57,16,601/- out of ₹ 31,40,96,154/- has already been added to petitioner’s income. Therefore, to say in the reasons for reopening that the assessee's claim of bad debts of ₹ 31,40,96,154/- was not allowable and that has resulted in escapement of income of the said amount shows non application of mind. On this count alone, it can be held that the Assessment Officer should not have formed the reasons to believe that income chargeable to tax has escaped assessment. We set aside the undated order rejecting petitioner’s objections. We also hold that there was no reason for the Assessing Officer to have a reasonable belief that income chargeable to tax has escaped assessment. - Decided in favour of assessee.
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