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2017 (7) TMI 696 - HC - Income TaxReopening of assessment - transfer of business of the assessee and exchange of shares between the companies and trust - reasons to believe - proof of non charitable activities - Held that:- The first part of the reasons referring to the complex structure of transfer of business of the assessee and exchange of shares between the companies and trust all happened during the year relevant to the assessment year 2011-12 and has therefore no direct bearing on the assessment year 2009-10 which is sought to be reopened. Whatever be the legality or the effect of such transactions on the assessment of the assessee for the relevant period, the same can have no relation to the assessee’s tax liability for the assessment year 2009-10. We cannot allow the Assessing Officer to examine this issue. Firstly, independently of the assessee’s activities of the assessment year 2011-12, the Assessing Officer had examined this question during the original assessment. We have noted the written queries raised by the Assessing Officer and the answers given by the assessee to such questions. This included the applicability of the amended Section 2(15) of the Act. We also noted that the Assessing Officer in the order of assessment did not, with the aid of such provisions, hold that the activities of the trust are not for charitable purpose. He, thus, accepted the assessee’s stand in this regard. Any attempt now to reexamine this issue would be considered as change of opinion and clearly impermissible even if it is within the period of four years. Assessing Officer has tried to link the assessee’s transactions of transferring its micro finance business to a company. This transfer or even valuation of the assessee’s tangible and intangible assets would not automatically imply that the activities of the assessee trust were not in the nature of charitable purpose. Substantial portion of the valuation was for tangible assets which may have been acquired by the assessee trust over a period of time. Even though part of the consideration comprised of valuation of intangible assets, the same would be of no consequence. - Decided in favour of assessee.
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