TMI Blog2024 (3) TMI 956X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on issues which have already been examined and verified during the original scrutiny assessment and the same cannot, in law, be a valid ground to reopen Petitioner s assessment for AY 2016-17 as the same would amount to a review . The same facts and materials on record cannot be re-examined for change of opinion under the garb or reassessment proceedings. It has been held in a catena of judgments that reassessment proceedings cannot be initiated by the AO when he has accepted the matter in an original assessment and the same would amount to a mere change of opinion and would not give rise to reasons to believe . Also further noticed from the documents on record that there was no reason nor any justification given in the notice to even arrive at prima facie finding that the cash deposits led to escapement of income. There was no response to Petitioner s requests for information regarding alleged undisclosed income pertaining to cash deposits over and above the deposits in the bank account. The impugned order does not even controvert the objection raised by Petitioner that the cash collected was not only deposited in its bank account but was also duly offered to tax. It is settled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to furnish details in respect of the source of FDs/deposits with the banks and cash deposited in various bank accounts during AY 2015-2016. Petitioner, vide letters dated 27th November 2018 and 17th December 2018 furnished replies to the scrutiny questionnaires and provided explanations and documents with respect to cash deposit of an amount of Rs. 2,61,37,708/-. Vide order dated 18th December 2018, Assessing Officer ( AO ) recorded his satisfaction with the explanation supplied to him by Petitioner and accepted the total returned income for AY 2016-17. 5. Petitioner received notice dated 25th March 2021 from the Department conveying that the AO had reasons to believe that Petitioner s income chargeable to tax for AY 2016-17 had escaped assessment. Petitioner complied and filed its ROI on 30th May 2021. 6. Petitioner requested the AO by its letter dated 16th July 2021 to provide reasons for reopening of the assessment and also sought a copy of the sanction order by the appropriate Authority under Section 151 of the Act. Petitioner received reasons to believe escapement of income by letter dated 16th February 2022 along with a copy of the sanction. The only reason averred by the De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port, Petitioner has declared application to charitable or religious purpose at Rs. 2,93,36,695/-. There is thus a difference of Rs. 53,56,087/- on application of fund. He argued that as per instructions of Central Board of Director of Taxes ( CBDT ) received under F.No. 225/40/2021/ITA.II dated 4th March 2021, the AO has to consider categories of cases listed therein as potential cases for taking action under Section 148 of the Act, which include reports made by the Directorate of Intelligence Criminal Investigation (I CI). As in Petitioner s case, the Jurisdictional Assessing Officer ( JAO ) proceeded on the basis of information received from the ITO(I CI), Kolhapur that income chargeable to tax has escaped assessment. Thereupon requisite sanction was obtained and the notice was issued. 10. The reasons recorded clearly indicate that notice has been issued and the reopening has been initiated on a mere change of opinion. In the earlier scrutiny assessment, Respondent No. 1 had the opportunity to specifically scrutinize the cash deposits made by Petitioner. A specific query was also raised by the IO, Kolhapur regarding the cash deposits under Section 133(6) of the Act, to which Pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment, review would take place. 7. One must treat the concept of change of opinion as an inbuilt test to check abuse of power by the assessing officer. Hence, after 1-4-1989, the assessing officer has power to reopen, 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 .. 13. It is further noticed from the documents on record that there was no reason nor any justification given in the notice to even arrive at prima facie finding that the cash deposits led to escapement of income. There was no response to Petitioner s requests for information regarding alleged undisclosed income pertaining to cash deposits over and above the deposits in the bank account. The impugned order does not even controvert the objection raised by Petitioner that the cash collected was not only deposited in its bank account but was also duly offered to tax. 14. It is settled law that a reason to suspect is not the same as reason to believe. There has to be a rational connection and the live link between the material coming to the notice of the AO and the formation of belief regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... postulates that there must be a direct nexus or live link between the material coming to the notice of the Income-tax Officer and the formation of his belief that there has been escapement of the income of the assessee from assessment in the particular year because of his failure to disclose fully and truly all material facts. It is not doubt true that the court cannot go into the sufficiency or adequacy of the material and substitute its own opinion for that of the Income-tax Officer on the point as to whether action should be initiated for reopening assessment. At the same time we have to bear in mind that it is not any and every material, howsoever vague and indefinite or distant, remote and far-fetched, which would warrant the formation of the belief relating to escapement of the income of the assessee from assessment .... 18. Thus, for the reasons discussed above and upon perusal of the letter providing the reasons to believe escapement of assessment as well as the order rejecting Petitioner s objections impugned herein, we have no hesitation in holding that there is no live link, which is a sine qua non between the material before the AO in the present case and the belief wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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