Court quashes assessment reopening for 2009-2010, upholds amalgamation scheme benefits.

The High Court allowed the petition, quashing the notice seeking to reopen the assessment for the year 2009-2010. The court held that the petitioner was entitled to the benefits of the approved scheme of amalgamation from the appointed date. The Assessing Officer's decision to reopen the assessment was deemed invalid as it was considered a change of opinion, and the original assessment had thoroughly examined the issues raised.

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Issues:
1. Validity of notice seeking to reopen assessment for the assessment year 2009-2010 based on irregular business losses and depreciation claimed by the petitioner.
2. Whether the Assessing Officer's decision to reopen the assessment was based on a change of opinion.
3. The impact of the High Court's approval of the scheme of amalgamation on the petitioner's claim for benefits during the assessment year under consideration.

Analysis:
Issue 1:
The petitioner challenged the notice dated 24.3.2014 issued by the Assessing Officer seeking to reopen the assessment for the assessment year 2009-2010. The Assessing Officer claimed that the petitioner wrongly claimed losses related to the amalgamation of a company. The Assessing Officer alleged that the set off of losses amounting to &8377; 2,38,23,768/- was premature and not in order since the High Court's approval of the scheme of amalgamation was awaited. The Assessing Officer believed that income to the tune of &8377; 2,38,23,768/- had escaped assessment due to the irregular business losses claimed by the petitioner.

Issue 2:
The petitioner contended that during the original assessment, the Assessing Officer thoroughly examined the issue of business losses and depreciation claimed by the petitioner. The petitioner argued that any attempt to reopen the assessment would amount to a change of opinion since the Assessing Officer made no disallowances in the original assessment. The petitioner also highlighted that the High Court's approval of the scheme of amalgamation was brought to the notice of the Assessing Officer during the original assessment.

Issue 3:
The High Court considered the impact of the approval of the scheme of amalgamation on the petitioner's claim for benefits during the assessment year under consideration. The petitioner had disclosed in the returns that the scheme of amalgamation was approved by two companies with effect from 1.4.2008 but was pending before the High Court for sanction. The petitioner relied on the Supreme Court decision regarding the effective date of the scheme. The High Court noted that the scheme's approval by the High Court related back to the appointed date, granting the petitioner the benefit of unabsorbed depreciation and losses from that date. The High Court emphasized that the Assessing Officer was aware of the scheme's approval before finalizing the assessment order.

In conclusion, the High Court allowed the petition, quashing the notice dated 24.3.2014 seeking to reopen the assessment for the assessment year 2009-2010. The court held that the petitioner was entitled to the benefits of the scheme of amalgamation from the appointed date, as approved by the High Court, and that the Assessing Officer's decision to reopen the assessment was not valid.

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