TMI Blog2021 (8) TMI 1015X X X X Extracts X X X X X X X X Extracts X X X X ..... ions or materials undoubtedly would provide the AO for 'reason to believe' to reopen the assessment. This being the factum established, this Court is of the considered opinion that the respondent could able to establish that the AO has 'reason to believe' for reopening of assessment. The other intricacies raised by the assessee on merits are to be adjudicated elaborately with reference to the original documents and evidences to be made available before the authority. Such an elaborate adjudication on merits need not be entertained by the High Court in a writ proceedings under Article 226 of the Constitution of India. In the present case, the reopening is based on certain materials on record, then further adjudications are to be done before the authority based on the materials available on record. The sufficiency of the reasons need not be gone into by the High Court in a writ proceedings. Thus, the petitioner is bound to co- operate for the completion of the reopening proceedings initiated u/s 147/148 of the Act and the respondent is directed to conclude the assessment / reassessment proceedings as expeditiously as possible by following the procedures as contempl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pects were completed under the normal provisions as well as regarding the international transactions. 4. The learned Senior counsel appearing on behalf of the writ petitioner made a submission that it is a case of change of opinion as the materials, informations, books of accounts as required were submitted during the course of assessment proceedings and the petitioner has not suppressed any material facts. The materials furnished for scrutiny and the discussions as well as the consideration deliberated in the original assessment order are taken for the purpose of reopening of assessment by forming another opinion and thus, the case on hand is change of opinion. 5. The notice under Section 148 of the Act was issued on 30.03.2011, admittedly, beyond the period of four years but within six years. The petitioner requested for furnishing reasons in vide letter dated 23.04.2011 and the respondent furnished the reasons in proceedings dated 18.02.2013. The petitioners filed their objections on 04.03.2013 and the said objections were disposed of by the respondent in order dated 12.03.2013, which is impugned in the present writ petition. 6. The learned Senior counsel for the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te with reference to the principles laid down by the Constitutional Courts. However, whether the 'reason to believe' is established in a particular case, is to be considered by the Court based on the facts furnished. In other words, the facts established in a particular case would be relevant for the purpose of arriving a conclusion, whether such case is falling within the ambit of change of opinion or not. Therefore, the consideration with reference to the facts furnished are to be looked into for forming an opinion. 10. The learned Senior counsel for the petitioner reiterated that the reasons furnished by the respondent are not fresh materials and the same materials, which were considered and findings are also available in the original assessment order. This being so, there is no reason whatsoever for reopening of assessment and thus, the order impugned is liable to be set aside. 11. The learned Senior Standing counsel for the respondent objected the contentions raised on behalf of the petitioner by stating that the materials produced by the petitioner / assessee are not in dispute. However, in the present case, the TDS deduction of four person made by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petent authority would reveal that the subject dealt with for reopening of assessment, were also considered during the original assessment proceedings. However, it is contended that under Explanation 1 to Section 147, even in case, where the assessee produced the account books or other evidences during the course of original assessment proceedings, the said materials also can be a reason for reopening of assessment, if some new informations or further materials are culled out from the original materials. 15. Reopening of assessment proceedings are made on numerous occasions. The scope of reopening of assessment under Section 147 of the Act is undoubtedly wider enough to cover various circumstances, if the Assessing Officer has 'reason to believe' that any income chargeable to tax has escaped assessment for any assessment year. However, this Court has to consider, whether such reopening and the reasons furnished for reopening of assessment have live link with the materials. 16. It is necessary to draw a distinction between the final assessment order and the order, disposing of the objections by the competent authority with reference to the objections filed by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 154 of the income tax reducing the total income to 108,74,01,200. Subsequently, the assessment was set aside vide the order of the DIT (IT) dated 12.03.2009 with the direction to recompute the total income of the assessee in as much as the assessment order dated 28.12.2006 in which deduction u/s 80 IB was erroneous and West Asia Maritime case, is in the nature of royalty. Therefore, the assessee has deducted lesser tax from the payment to the Non-Residents. In this context, it may be noted that the CBDT instruction No 1862 which was clarified that provision of services by a foreign company would be outside the purview of section 44D or section 115A was issued in the context of services like imparting of training and carrying out drilling operations. The services in the subject case are different which do not fall within the ambit of section 44BB of the Act. Reference can be made to the judgement of the Hon'ble Uttarakhand High Court in CIT and Another vs ONGC Ltd (309 ITR 244). The principle evolving from the ruling of the Hon'ble Authority of Advance Ruling in No P/6 OF 1995, (234 ITR 371) also stipulates that there is wide range of income falling under Section 44BB whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to cripple the powers of the Assessing authority conferred under the Act. Numerous circumstances are contemplated, in view of the fact that the original assessment order was passed based on the return of income filed by the assessee. The Assessing authority may not have considered all the intricacies involved in such business or other transactions. Undoubtedly, the business and trading activities are being carried out in a calculated manner by the traders. The intricacies involved may be traced out even at later point of time. Such being the possible circumstances, the very purpose and object of Section 147 of the Act for reopening of assessment, if the income chargeable to tax escaped assessment cannot be narrowed down, so as to dilute the very object of the Act. 20. However, on reopening of assessment, the assessee gets an opportunity to defend its case in the manner known to law. Thus, there is no substantial prejudice is caused except that the assessment is reopened. However, if such reopenings are made within the scope of Section 147, then the authority must be allowed to continue the reopening proceedings and conclude the same by providing opportunity to the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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