Reopening of 1992-1993 tax assessment deemed unjust; Section 148 notice quashed due to impermissible change of opinion.

The court held that the reopening of the assessment for the Assessment Year 1992-1993 was unjustified. The notice issued under Section 148 of the Income Tax Act was quashed, and the petition was granted in favor of the petitioner. The court emphasized that the Kar Vivad Samadhan Scheme (KVSS) order was conclusive, and reopening the assessment was based merely on a change of opinion, which is impermissible. The petition was disposed of accordingly.

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Issues Involved:
1. Reopening of completed assessment.
2. Validity of notice issued under Section 148 of the Income Tax Act.
3. Impact of the Kar Vivad Samadhan Scheme (KVSS) on reopening of assessment.
4. Alleged misdeclaration under KVSS.
5. Applicability of the doctrine of change of opinion.

Summary:

Reopening of Completed Assessment:
The petitioner, a corporate body incorporated in the USA, challenged the respondent's action to reopen the completed assessment for the Assessment Year 1992-1993. The petitioner contended that despite repeated requests, the reasons to believe were not provided, which were later annexed to the affidavit in reply by the respondent.

Validity of Notice Issued under Section 148:
The petitioner received a notice dated 10th January 2000 under Section 148 of the Income Tax Act, alleging that income for the Assessment Year 1992-1993 had escaped assessment. The petitioner challenged the validity of this notice and called for the reasons to believe, which were refused by the respondent, prompting the petitioner to approach the court.

Impact of the Kar Vivad Samadhan Scheme (KVSS):
The petitioner argued that once the assessment for the entire year was settled under the KVSS, and the Designated Authority had made an order under Section 90, which was complied with by payment, there was no question of reopening any issue covered by the order. The petitioner cited the Supreme Court's ruling in Killick Nixon Ltd. v/s. Deputy Commissioner of Income Tax, which held that once the Designated Authority issued a conclusive order under Section 90, the Assessing Officer had no jurisdiction to reopen the assessment except in cases of false declaration.

Alleged Misdeclaration under KVSS:
The respondent argued that there was a misdeclaration under Section 90(1) of the KVSS, which would nullify the declaration. However, the court noted that this was not the case in the reasons to believe for reopening the assessment, and there was no order withdrawing the Form 3 issued under the KVSS.

Applicability of the Doctrine of Change of Opinion:
The petitioner contended that the reopening was based on a change of opinion, as the Assessing Officer had already raised and addressed queries regarding the Portfolio Management Scheme (PMS) during the original assessment proceedings. The court agreed, citing that once a query is raised and answered during assessment, it cannot be reopened on the same grounds.

Conclusion:
The court held that the reopening of the assessment was not justified. The notice issued under Section 148 was quashed, and the petition was made absolute in terms of prayer clause - (a). The court emphasized that the KVSS order was conclusive, and the reopening was merely based on a change of opinion, which is not permissible. The petition was accordingly disposed of.

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