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2022 (9) TMI 55 - HC - Income TaxReopening of assessment u/s 147 - scope of reopening by issuance of notice under section 148 - reference to expressios “reason to believe” and “change of opinion” - As argued by petitioner that there was no additional material which was available before the Assessing Officer and notices issued prior to the assessment was duly replied with supporting documents - HELD THAT:- As decided in Rajesh Jhaveri Stock Brokers P. Ltd. [2007 (5) TMI 197 - SUPREME COURT] that expression “reason to believe” should not be read to mean that Assessing Officer should have finally ascertained the fact by legal evidence or conclusion. The expression “reason to believe” would mean cause or justification for reopening. If the Assessing Officer has cause or justification to know or suppose to know that income had escaped assessment, it can be said to have reason to believe that income had escaped assessment. Thus, the expression “reason to believe” would mean and include that there should be subjective satisfaction by objective assessment available with the Assessing Officer for issuance of notice. In the instant case, the said notices, which are issued to the petitioner, have been furnished to the petitioner and conclusion drawn by the AO for reopening of assessment is that the AO received “insight portal” information to the effect that the petitioner firm is in business of lucky draw networking scheme and that no other tangible assets were handled by the firm other than financial transactions. Though Mr.Darshan Patel has made valiant attempt to contend before this Court that information sought for while issuing notices under sections 143(2) and 142(1) of the Act, details have been produced. The fact remains that the Assessing Officer did not possess this insight portal information which has been relied upon for issuance of the notices under section 148 of the Act. As such, the contention raised by learned counsel appearing for the petitioner requires to be considered for the purpose of outright rejection and it stands rejected. Whether while giving approval under section 151 of the Act, there has been no due application of mind by the said authority? - The information which was secured by the Assessing Officer subsequent to the assessment proceedings or scrutiny proceedings has been referred to and this has been considered, examined and on objective assessment of the material on record available before the said authority, permission has been accorded under section 151 of the Act which cannot be said, held or construed as without due application of mind. As such, the said contention also stands rejected. Though several judgments on the said issue i.e. change of opinion and explaining the term or expression “reason to believe” have been relied upon, we are of the considered view that all these judgments are based on the facts and as such, without dwelving upon each of these judgments, we hold that there cannot be any second opinion with regard to proposition of law that mere change of opinion cannot form the basis for reopening of assessment. This Court in exercise of powers vested under Article 227 of the Constitution of India would not take over the decision making powers of the statutory authority. The Honourable Apex Court in the case of D.N. Jeevaraj [2015 (11) TMI 1798 - SUPREME COURT] has held that the High Court cannot mandate beyond the course of action to be taken by the statutory authority by giving complete go-by to the procedural requirement and the Court itself taking over functions of the authority. Thus contentions of learned counsel appearing for the petitioner cannot be accepted and it stands rejected and the point formulated hereinabove is accordingly answered in the negative i.e. in favour of the respondent and against the petitioner assessee.
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