1995 (12) TMI 69 - HC - Income Tax

High Court rejects reference application under Income-tax Act, emphasizing factual over legal issues

The High Court upheld the Tribunal's decision, ruling that the reassessment was a mere change of opinion by the Income-tax Officer. The permission ... Question Of Law Issues:1. Whether the reassessment was merely a change of opinion by the Income-tax OfficerRs.2. Whether the sanction obtained by the Income-tax Officer from the Board was not in accordance with the lawRs.Analysis:The case involved an income-tax reference under section 256(2) of the Income-tax Act, 1961, initiated by the Revenue. The facts revealed that the assessee, a Hindu undivided family, had their land compulsorily acquired, leading to a substantial gain that had escaped assessment. The Income-tax Officer proposed proceedings under section 147(a) and issued a notice under section 148 for reassessment. The assessment was completed, resulting in a total income of Rs. 79,061, which was challenged through appeals up to the Income-tax Appellate Tribunal.The Tribunal concluded that the reassessment was invalid as it was a mere change of opinion by the Income-tax Officer. Despite the facts being before the Officer during the original assessment, seeking permission from the Board for reopening was deemed unnecessary. Additionally, the Tribunal found that the Officer had not provided correct facts to the Board, rendering the sanction obtained improper. Consequently, the Tribunal rejected the reference application, emphasizing that the case revolved around factual issues rather than substantial questions of law.Upon reviewing the Tribunal's decision, the High Court concurred with the findings. It noted that the reassessment was indeed a change of opinion by the Officer, and the permission obtained from the Board was flawed due to incorrect facts presented. As no substantial question of law was identified, the High Court declined to call for the reference under section 256(2) of the Income-tax Act, ultimately rejecting the reference application by the Revenue.