The AO's reopening of assessment after four years on the ground...

The AO's reopening of assessment after four years on the ground of alleged benefit received by the assessee in the transaction of purchasing shares of HHML from Honda was held unjustified. The assessee had furnished all relevant material facts during the original assessment proceedings. The AO's invocation of Section 28(iv) to treat the alleged discount as a business benefit was incorrect, as the assessee held the shares as a promoter shareholder and long-term investment, not for trading purposes. The CIT(A) had previously rejected the AO's conclusion that the income from share transactions was business income and held it to be capital gains. The reopening amounted to a mere change of opinion, which is impermissible. The assessee's consistent treatment of shares as investments in its books and the absence of any surreptitious conduct regarding the share purchase transaction were also noted.