TMI Blog2023 (6) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings initiated by the A.O. u/s 147/148 on mere change of opinion and reviewing the completed assessment is contrary to the settled position of law - Decided in favour of assessee. - I.T.A. No. 6300/DEL/2018 And C. O. No. 70/Del/2021 in I.T.A. No. 6300/DEL/2018 - - - Dated:- 22-6-2023 - Dr. B. R. R. Kumar, Accountant Member And Shri Yogesh Kumar U.S., Judicial Member For the Assessee : Shri Ved Jain, Advocate; And Shri Aman Garg, C. A.; For the Department : Shri T. Kipgen, [CIT] - D. R.; ORDER PER YOGESH KUMAR U.S., JM This appeal and the cross objection are filed by the Revenue and assessee respectively against the order of the ld. Commissioner of Income Tax (Appeals)-XXV [hereinafter referred to CIT (Appeals) New Delhi, dated 27.07.2018 for assessment year 2009-10. I.T.A. No. 6300/DEL/2018 :- 2. The Revenue has raised the following substantive ground of appeal:- Whether on the facts and under the circumstances of the case, the Ld. Commissioner of Income Tax (Appeals) erred in deleting the addition of Rs. 23,16,00,000/- made by the AO on account of unexplained cash credit under section 68 of the Income Tax Act, 1961, despite the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee is a Limited Company received share capital of Rs. 23,16,00,000/- in the year under consideration. The assessee filed return of income for the Assessment Year 2009-10 declaring a total income of Rs. 5,55,70,290/- which was processed u/s 143(1) of the Act and was selected for scrutiny assessment. During the assessment proceedings, the assessee was asked to explain regarding share application money raised by the assessee and the assessee provided the details in respect of the share application money received during the year. The assessment order came to be passed u/s 143(3) of the Act on 30/12/2011 by computing the total income of the assessee at Rs. 5,60,94,110/- by making an addition of Rs. 5,23,822/- u/s 14A of the act. On the basis of information received from the Investing Wing, the reassessment proceedings were initiated against the assessee u/s 148 of the Act a notice u/s 143(2) dated 01/06/2016 along with reasons recorded for initiating the proceedings u/s 147 of the Act were issued to the assessee. The Assessing Officer assessed the income of the assessee at Rs. 28,85,94,110/- as against the returned income of Rs. 5,69,94,110/- by making addition of Rs. 23,16,00,000/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of proceedings u/s 147/143(3) of the Act is in accordance with law. 10. We have heard the parties perused a material on record. It is emerges from the record that on the basis of the report of Investigating Wing, the case pf the Assessee was reopened. It is the specific case of the assessee that in the survey operation conducted on 21/10/2013 in the business premises of the assessee no incriminating material was found and no any discrepancy in the books of the assessee was noted by the Assessing Officer. 11. During the original assessment proceedings u/s 143(3) of the Act the AO had raised a specific query regarding share application money raised by the assessee. The extract of the notice issued by the AO are reproduced hereunder: ANNEXURE TO NOTICE U/S 142(1) OF THE I.T. ACT, 1961 In order to complete the assessment u/s 143(3), You are requested to kindly furnish the details as under :- 1. Detailed note on the history/nature of the business and/or the sources of income declared. Please state whether there is any change in object since incorporation. Please file copy of memorandum and article of association. 2. Name Address/PAN/Asstt. Particulars of Direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 009.As annexure-2 4. Form No. 18 Filed with ROC as an evidence of Corporate Office. There is no branch office of the company. Copy of form No 8 is attached and Marked as annexure-3. 5. Copy of assessment order may be available with the department. 6. Our business is not of Manufacturing or trading in nature, so this clause is not applicable. 7. Name and complete communication address of the parties from / to whom loan and advances above Rs. 50000/- was received / given during the year. Annexure as per Section 269SS 269TT is enclosed and marked as Annexure-4. 8. The expenses charges are as per profit and loss account which has already been submitted with all relevant schedules. The books of account may be submitted as when required for your perusal at any time. 9. Details of Expenses covered u/s 43B with required information's with the copy of proof of payment is enclosed and marked as Annexure-5. 10. Details of additions to fixed assets along with supporting documents with date of put to use of assets during the year is enclosed and Marked as Annexure-6. 11. Details along with complete address with confirmations of all the transactions du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings u/s 143(3) of the Act, the Assessee had already disclosed all the details and facts regarding the share application money on the specific query and considering the fact that the assessment proceedings were initiated on satisfaction borrowed from report of Investigation Wing, in the absence of any whisper or allegation on the Assessee regarding non disclosure of fully and truly all material facts in the reasons, in our considered opinion the proceedings initiated u/s 148 of the Act cannot be sustained. 16. It is well settled law that the Assessing Officer cannot invoke the provisions of Section 147 148 of the Act merely on the change of opinion wherein the original assessment u/s 143(3) of the Act was completed after due consideration of the facts. The Co-ordinate Bench of the Tribunal in ITA No. 473/Del/2017 in the case of Anant Raj Ltd. Vs. DCIT reported in (2021) 226 DTR 33 held as under:- Reassessment -Full and true disclosure-Absence of new tangible material- Assessee had declared long-term capital gain on sale of the property - It placed on record all evidences to show that the information submitted by it were correct, property was held for a period of more ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ween power to review and power to reassess. The Assessing Officer has no power to review; he has the power to re-assess. But reassessment has to be based on fulfillment of certain pre-condition 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 Assessing Officer. Hence, after 1st April, 1989, Assessing Officer has power to re-open, provided there is tangible material to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief. Our view gets support from the changes made to Section 147 of the Act, as quoted hereinabove. Under the Direct Tax Laws (Amendment) Act, 1987, Parliament not only deleted the words reason to believe but also inserted the word opinion in Section 147 of the Act. However, on receipt of representations from the Companies against omission of the words reason to believe , Parliament re-introduced the said expression and deleted the word opinion on the groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learly indicated the nature and contents of the TIUF and the treatment given by the assessee in its books of accounts. The same had also been examined by the Assessing Officer as aforesaid. Thus, in respect of the assessment years 1997-98 and 1998-99 this additional ground is also available in favour of the assessee/petitioner. 10. The position that a mere change of opinion would not entitle an Assessing Officer to reopen a completed assessment is well settled. The latest decision being of the Supreme Court in Civil Appeal No.2009-2011 of 2003 and Civil Appeal No. 2520 of 2008 decided on 18th January, 2010 which approves this Court ‟ s Full Bench decision in the case of Commissioner of Income Tax vs. Kelvinator of India Limited:256 ITR 1 (Del.) (HC). The power of re-assessment is different from the power of review. The Assessing Officer has been given the power to re-asses under Section 147 upon certain conditions being satisfied. The Assessing Officer does not have the power of review. If a change of opinion were to be permitted as a ground for re-assessment then it would amount to granting a licence to the Assessing Officer to review ‟ his decisions, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le of change of opinion. Similarly, in that situation where query is raised and answered by the assessee in original assessment proceedings, and thereafter, the Assessing Officer does not make any addition in the assessment order, the reassessment proceedings will be invalid in that scenario also, it has to be accepted that the Assessing Officer had formed an opinion in the original assessment although he had not recorded his reasons for forming opinion but still this is a change of opinion if the Assessing Officer starts the reassessment proceedings for the same issue. In the light of this, now we examine the facts of the present case. As per the original assessment order passed by Assessing Officer u/s 143(3) dated 11/12/2008, it is seen that it is noted by Assessing Officer on page No. 2 of this assessment order that queries were raised vide letter dated 12/11/2008. The queries are reproduced by the Assessing Officer on pages 2 of the assessment order and one of the queries was that the assessee was asked to explain as to why the prior years expenses should not be disallowed. The reply of the assessee before the Assessing Officer are also reproduced by the Assessing Officer on p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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