Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (5) TMI 1639 - AT - Income TaxValidity or reopening of assessment - reasons to believe that the disallowance made on account of Section 14A in respect of proportionate interest and the average value of investment Held that:- AO did not give any evidence of any tangible material in his possession in the recorded reasons other than the original material on which disallowance under section 14A was based in the original assessment order under section 143(3) of the Act. Hence there is no ‘tangible material’ to come to the conclusion that there is escapement of income. There is a conceptual difference between power to review and power to re-assess. The AO has no power to review; he has the power to re-assess. But re-assessment has to be based on fulfillment of certain pre-conditions as explained above and if the concept of “change of opinion” is removed, as contended on behalf of the Department, then, in the garb of re-opening the assessment, review would take place. One must treat the concept of “change of opinion” as an in-built test to check abuse of power by the AO. Hence, after 1.4.1989, the AO has power to re-open, provided there is “tangible material” to come to the conclusion that there is escapement of income from assessment. Therefore, we are of the view that an error discovered on a reconsideration of the same material (and no more) does not give AO, the power to assume jurisdiction to make reassessment. - Decided in favour of assessee
|