Tribunal overturns Assessing Officer's decision on reopening assessments, citing change of opinion rule

The Tribunal ruled in favor of the appellant-company, holding that the Assessing Officer's decision to reopen assessments based on a change of opinion regarding higher depreciation claimed for vehicles used for commercial hiring was unjustified. Citing various High Court and Supreme Court decisions, the Tribunal concluded that once all material facts were disclosed, reassessment could not be initiated solely on a change of opinion. As the relevant details had been previously considered, the Tribunal deemed the reassessment under section 147 as unwarranted, allowing the appellant's appeals.

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Issues:
Challenge to reopening of assessment under section 147 based on higher rate of depreciation claimed for vehicles used for commercial hiring.

Analysis:
The appellant-company challenged the reopening of assessment for two assessment years, contending that higher depreciation was claimed as the vehicles were used for commercial hiring. The AO had initially accepted the claim of higher depreciation for one year but later reopened both assessments, arguing that the vehicles were not used for commercial hiring by the assessee. The appellant argued that the use of vehicles by sub-lessee was relevant for depreciation claim. The AO's decision was influenced by a Calcutta High Court case, but the appellant distinguished it, citing other High Court decisions supporting their claim.

The appellant relied on various High Court decisions, including Gujarat and Delhi High Courts, to support their argument that once all material facts were disclosed, assessment could not be reopened. The Delhi High Court's decision emphasized that higher depreciation was available for leasing out vehicles as part of the business. The Supreme Court's decision in a related case also supported the view that reassessment cannot be based on a mere change of opinion. The Tribunal considered these precedents and concluded that the AO's action was merely a change of opinion, not a valid reason for reassessment under section 147.

In light of the decisions of multiple High Courts and the Supreme Court, the Tribunal found that the AO's decision to reopen the assessments was based on a change of opinion rather than new facts. As full details regarding the depreciation claim were already available and considered in a previous assessment, the Tribunal held that the authorities were not justified in initiating reassessment under section 147. Consequently, the Tribunal allowed the appellant's appeals, ruling in favor of the assessee.

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