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TMI Blog2020 (7) TMI 573X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer on this issue in the original assessment? (ii) Whether the Tribunal was right in not considering the decision of the Hon'ble Supreme Court wherein reopening of assessment on the basis of information possessed by the Assessing Officer either from external sources or from material on record is legally tenable as held in the case of Kalyanji Mavji & Co., vs. CIT [reported in 102 ITR 286] ? and (iii) Whether the Tribunal was right in stating that reopening of assessment is bas in law when Section 147 of the Income Tax Act clearly says that if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment, the Assessing Officer can assess or re-assess the assessment?" 3. Heard Mr. T.R. Senthil Kumar, learned Senior Standing Counsel assisted by Ms. K.G. Usha Rani, learned Junior Standing Counsel appearing for the appellant/Revenue and Mr. Naresh Kumar, for Mr. R.N. Amarnath, learned counsel appearing for the respondent/assessee. 4. The issue, which falls for consideration, is whether the reopening of the assessment under Section 147 of the Income Tax Act ('The Act' for brevity) is proper and valid. 5. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied, that would be sufficient to answer all the three questions, because all the three substantial questions of law are interlinked and the only issue is whether the reopening of assessment is valid. 8. The learned counsel appearing for the Revenue strenuously contended that the notice under Section 148 was served on the assessee on 26.03.2014, well before the expiry of four years and the observations of the Tribunal that the revision of assessment was based on change of opinion, is an incorrect finding and the question of obtaining fresh tangible material is not necessary when the assessment is reopened within four years. In this regard, the learned counsel referred to Section 147 of the Act and also the three provisos and four explanations contained therein. In support of his contentions, the learned counsel referred to the judgment of the High Court of Gujarat in Chunibhai Ranchhodbhai Dalwadi vs. Assistant Commissioner of Income-tax, [2017] 81 Taxmann.com 136 (Gujarat). 9. The learned counsel appearing for the respondent/assessee submitted that the Tribunal has elaborately considered the issue, referred to various decisions and has rightly held that the reopening was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue in all cases of reopening is whether the Assessing Officer had "reason to believe" that income chargeable to tax has escaped assessment. The reason to believe cannot be on a "change of opinion". The assessee is expected to file his return of income along with his books and documents. It is for the Assessing Officer to consider the same in accordance with law and complete the assessment. The assessee is not there to advice the Assessing Officer as to how he should go about in assessing the income of the assessee, as it is the statutory duty of the Assessing Officer. Admittedly, the Sale Deed dated 02.05.2008, is only the document, which is the subject matter of the assessment. This document was very much available with the Assessing Officer when he completed the assessment under Section 143(3), dated 05.12.2011. At that juncture, all that the Assessing Officer was concerned about is the claim made by the assessee as expenses for the improvement of the land by levelling, sand filling, road laying etc. 13.The stand taken by the assessee was disbelieved, as no material evidence was produced by the assessee to substantiate such expenses. Based on the very same document, the assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment and therefore, held that the reopening within four years was permissible. This decision relied on by the revenue is clearly distinguishable on facts, as there is no allegation against the assessee before us that he failed to fully and truly disclose all information. 17.That apart, the effect of the CBDT circular was taken note of and considered by this Court in R.Sugantha Ravindran (supra). At this juncture, it will be beneficial to refer to the operative operation of the said judgment:- "10. Even otherwise, we are of the firm view that the insertion of words "or assessable" by amending Section 50C with effect from 01.10.2009 is neither a clarification nor an explanation to the already existing provision and it is only an inclusion of new class of transactions namely the transfers of properties without or before registration. Before introducing the said amendment, only the transfers of properties where the value adopted or assessed by the stamp valuation authority were subjected to Section 50C application. However after introduction of the words "or assessable" after the words "adopted or assessed", such transfers where the value assessable by the stamp valuation author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as complete failure on the part of the Assessing Officer to apply his mind and therefore, held reopening to be valid. We do not find any such nonapplication of mind by the Assessing Officer, as the Assessing Officer has considered the affect of the sale deed and there are no other complicated issues in the assessment. 24. The decision in the case of Consolidated Photo & Finvest Ltd., (supra) was a case where the assessment order did not address the aspect on which reopening was made. This would arise when there are several issues to be determined by the Assessing Officer, not as in the case of the assessee on hand, where there is a single issue regarding valuation of the property. 25. The decision in the case of Smt.A.Sridevi (supra) will not apply to the facts of the case on hand, because the assessee in the said case did not produce the relevant documents. In the case of Chunibhai Ranchhodbhai Dalwadi (supra), the assessee did not declare the long term capital gain in the original return of income nor the Assessing Officer considered the same, whereas in the instant case, the only issue was the claim of cost of improvement against capital gains and there was no other iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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