Tribunal Rejects Reassessment Based on Change of Opinion, Upholds CIT(A)'s Decision

The Tribunal upheld the CIT(A)'s decision to quash the reassessment proceedings for the assessment year 2009-10, denying deduction u/s.80IB(10). The reassessment was found invalid as it was based on a mere change of opinion by the new AO, not new material, following the precedent set in CIT Vs. Kelvinator of India Ltd. The Tribunal emphasized the significance of the validity of reassessment and ruled in favor of the assessee, dismissing the appeal and highlighting the impermissibility of reassessment solely on a change of opinion.

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Issues:
Initiation of reassessment based on change of opinion and validity of reassessment proceedings.

Issue 1: Initiation of Reassessment

The appeal by the Revenue challenged the CIT(A)'s decision on the initiation of reassessment proceedings for the assessment year 2009-10. The CIT(A) held the reassessment as bad in law despite the assessee not raising objections during the proceedings. The new AO initiated reassessment proceedings after a change in jurisdiction, and the assessment was completed denying the deduction u/s.80IB(10). The CIT(A) found the reassessment invalid and decided in favor of the assessee. The Tribunal upheld the CIT(A)'s decision, stating that the validity of reassessment, not objections raised, is crucial. The reassessment was deemed invalid as it was based on a mere change of opinion, following the judgment in CIT Vs. Kelvinator of India Ltd. The first ground of appeal was dismissed.

Issue 2: Change of Opinion in Reassessment

The second ground of appeal focused on the quashing of reassessment due to a change of opinion. The AO initially examined the deduction claim under section 80IB(10) during the original assessment, based on documents provided by the assessee. The reassessment was initiated based on discrepancies in the commencement date of the project. However, the Tribunal found that the reassessment was solely a result of a change of incumbent's opinion, not new material. This change of opinion was deemed impermissible as per the Supreme Court's judgment in CIT Vs. Kelvinator of India Ltd. The reassessment was quashed as invalid, and there was no need to delve into the merits of the issue. The appeal was dismissed by the Tribunal.

In conclusion, the Tribunal upheld the CIT(A)'s decision to quash the reassessment proceedings due to a change of opinion and lack of fresh material. The judgment emphasized the importance of the validity of reassessment and the impermissibility of reassessment based solely on a change of opinion.

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