TMI Blog2016 (9) TMI 1614X X X X Extracts X X X X X X X X Extracts X X X X ..... s the subject matter of assessment proceedings and, therefore, reopening on this issue, if permitted, the same would be based upon the change of opinion which is impermissible and, therefore, it also appears to us that the impugned notice is not valid. The contention of the Revenue that the impugned action is within the period of four years and, therefore, it is always open for the authority to reopen the assessment cannot be accepted. Simply because the action is within the period of four years would not give a leverage to the authority to just go on repeating the exercise of examining the issue which has already been gone into. There appears to be no tangible material distinct from what was made a part of the assessment proceedings and, therefore, reopening of the assessment is not permissible. The proposition of law is aptly clear, as stated above and, therefore, in our opinion, permitting the authority to reopen the assessment would not be valid. We cannot shut our eyes over the aforesaid circumstance simply because it is within the period of four years and having regard to the decisions of Apex Court which propounded that the Courts would be failing to perform their duty, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12.2007. From the record, it appears that though this clarification and explanation were given and the particulars were supplied in the original assessment order dated 31.12.2007, the amount in question namely ₹ 79,95,798/- is neither disallowed nor added back but was forming part of the record of the assessment proceedings. It appears that on 25.3.2010 the respondent - authority had issued impugned notice under Section 148 of the Act for reopening of the assessment for the Assessment Year 2005-2006 on the belief that the income with respect to that period has escaped the assessment within the meaning of Section 147 of the Act. Based upon the said impugned communication, on 12.4.2010 the petitioner wrote a letter to the respondent-authority requesting the authority to supply the reasons which have been recorded in response to the said impugned action. The respondent-authority under a communication dated 16.4.2010 supplied the reasons with respect to the impugned action. The said reasons are reproduced hereinbelow: The return of income for the year under consideration, declaring a total loss of ₹ 4,36,776/- was filed on 30/10/05. Assessment in this case was complete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Municipal Corporation, and the receipt of the same is also given by the Surat Municipal Corporation. It was also pointed out while referring to the account of M/s. Shanti Enterprise for Assessment Year 2004-2005, that this figure of balcony premium is already reflected. It was also pointed out that, on 18.10.2007, during the process of assessment, the petitioner was directed to furnish the particulars and information with respect to this very issue and the same has been supplied under a communication dated 18.10.2007. While referring to this reply, counsel for the petitioner has drawn the attention to Clauses 9 and 11 of the said reply which indicates that the amount of ₹ 79,95,738 as already been paid and acknowledged by the Corporation. It is also emerging from the record that in a communication dated 25.10.2007, this very issue has also been explained again in Clauses 9 and 11 with respect to balcony premium and the same was stated to have been debited while the work in progress and, therefore, the learned counsel has drawn the attention by pointing out that during the process of assessment, this issue was very much dealt with and, therefore, the impugned action permitti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The notice which has been issued on 18.10.2007 calling upon the petitioner to furnish in writing the information, in clauses 9 and 11 reads as under: 9. You have also not submitted any details regarding impact fees given to SMC, hence the same may be submitted. 11. It is found from the record that you have paid an amount of ₹ 79,95,798 to SMC as a balcony premium. It is not understood as to where this expenditure has been debited. Please explain the same. 6. Even in further explanation also came to be forwarded on 25.10.2007 as reflected from the record of the petition in which also in detail the balcony premium has been explained and the said aspect also deserves to be taken note and therefore, reproduced hereinafter: 9. No impact fees of any nature have been paid by the assessee. It appears that your reference is to page No. 9 of my earlier submission No. TP-662 of 25th July, 2007. The said amount was paid as Balcony premium 11. Balcony premium of ₹ 79,95,798/- is debited to work-in-progress. This includes ₹ 77,81,865/- (can be referenced on Page No. 8 of TP-662 of 25th July 2007). 7. In the assessment order dated 31.12.2007 the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or even review if statute so permits but not liable to be re-opened by the same authority. Such powers are vested by the Legislature presumably in view of the highly complex nature of assessment proceedings involving large number of assessees concerning multiple questions of claims, deductions and exemptions, which assessments have to be completed in a time frame. To protect the interest of the revenue, therefore, such special provisions are made under section 147 of the Act. However, it must be appreciated that an assessment previously framed after scrutiny when reopened, results into considerable hardship to the assessee. The assessment gets reopened not only qua those grounds which are recorded in the reasons, but also with respect to entire original assessment, of course at the hands of the revenue. This obviously would lead to considerable hardship and uncertainty. It is precisely for this reason that even while recognizing such powers, in special requirements of the statute, certain safeguards are provided by the statute which are zealously guarded by the courts. Interpreting such statutory provisions courts upon courts have held that an assessment previously framed cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the validity of the claim. His formation of opinion is thus complete. Merely because he chooses not to assign his reasons in the assessment order would not alter this position. It may be a non-reasoned order but not of acceptance of a claim without formation of opinion. Any other view would give arbitrary powers to the Assessing Officer. 43. We are, therefore, of the opinion that in a situation where the Assessing Officer during scrutiny assessment, notices a claim of exemption, deduction or such like made by the assessee, having some prima facie doubt raises queries, asking the assessee to satisfy him with respect to such a claim and thereafter, does not make any addition in the final order of assessment, he can be stated to have formed an opinion whether or not in the final order he gives his reasons for not making the addition. 9. In view of aforesaid circumstances, and in addition thereto, it is further appearing to us that the ratio laid down by the Apex Court in the case of Kelvinator of India Ltd. (supra) is also governing the controversy in question and, therefore, the relevant extract of catch-note of this decision worth to be taken note and therefore reproduce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The observations made by the Apex Court in case of Calcutta Discount Co. Ltd. v. ITO reported in [41 ITR 191 at page 195 head-note (v) are worth to be reproduced hereafter: That though the writ of prohibition or certiorari would not issue against an executive authority, the High Courts had power to issue in a fit case an order prohibiting an executive authority from acting without jurisdiction. Where such action of an executive authority, acting without jurisdiction subjected, or was likely to subject, a person to lengthy proceedings and unnecessary harassment, the High Courts would issue appropriate orders or directions to prevent such consequences. The existence of such alternative remedies as appeals and reference to the High Court was not, however, always a sufficient reason for refusing a party quick relief by a writ or order prohibiting an authority acting without jurisdiction from continuing such action. When the constitution conferred on the High Courts the power to give relief it becomes the duty of the Courts to give such relief in fit cases and the courts would be failing to perform their duty if relief were refused without adequate reasons. 12. Considering t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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