TaxTMI 
TaxTMI 
2010 (5) TMI 570
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....ng admission, hearing, and disposal of this petition, ad interim relief be granted and the respondent be ordered to restrain from enforcing compliance with the impugned notice dated October 28, 2009 at annexure I and/or taking any other steps in this regard including ex parte order or implementation of the preliminary order dated March 5, 2010 at annexure M. Pending admission, hearing and till final disposal of this petition, stay the implementation/operation of the notice and orders to restrain the respondent from taking any further proceedings pursuant to the impugned notice at annexure I including stay of operation of preliminary order at annexure M. Award the cost of this petition. Grant such other and further reliefs as this hon'ble court deems fit. 3. The petitioner, a company filed return of income for the assessment year 2004-05 along with the necessary documents like the statement of income, audited accounts, auditor's reports in Form Nos. 3CB, 3CD, 10CAAC and 29B. The Assessing Officer issued notice under section 143(2) of the Act and vide order dated December 26, 2006, framed scrutiny assessment under section 143(3). Being aggrieved on certain co....
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....pletely ; that the reasons recorded by the respondent are based on details and information filed by the petitioner. It is, accordingly, submitted that the issuance of notice and initiation of proceedings under section 147 read with section 148 of the Act are violative of the proviso to section 147 of the Act. 6. Learned advocate for the petitioner has further submitted that on the basis of computation of total income, audit report under Form 29B and audit report under Form 10CAAC filed by the assessee along with its return of income, the then Assessing Officer had finally assessed the income on book profit under section 115JB and allowed the claim for deduction under section 80HHC. Thus, there was due application of mind on the part of the Assessing Officer while computing the book profit under section 115JB and allowing the deduction under section 80HHC claimed by the assessee company. Hence, reopening the case under section 147 on the very same issues is nothing but a change of opinion on the same set of facts. Inviting attention to the affidavit-in-reply filed by the respondent, it is submitted that the respondent has stated in the affidavit-in-reply that the petitioner ....
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....ll material facts necessary for its assessment, the respondent is justified in reopening the assessment in exercise of powers under section 147 of the Act. 8. Section 147 of the Act provides that if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under the section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned. The proviso to section 147 provides that where an assessment under sub-section (3) of section 143 or section 147 has been made for the relevant assessment year, no action shall be taken under the section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of failure on the part of the assessee to make a return under section 139 or in response to a notice und....
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....rence which appears subsequently to be erroneous, mere change of opinion with regard to that inference would not justify initiation of action for reopening assessment. The grounds or reasons which lead to the formation of the belief contemplated by the proviso to section 147 of the Act must have a material bearing on the question of escapement of income of the assessee from assessment because of his failure or omission to disclose fully and truly all material facts. 11. It may, therefore, be germane to refer to the reasons for reopening the assessment recorded by the Assessing Officer which read thus : "The assessee-company filed its return of income on October 29, 2004 declaring a total income of Rs. 23,54,96,896. The assessment was finalized under section 143(3) determining the total income at Rs.24,19,86,700. On verification of the records, it is seen that the assessee-company had reduced an amount of Rs. 3,68,02,210, from book profit as per (viii) of the second proviso to section 115JB of the Act instead of Rs. 1,02,22,660 resulting in underassessment of Rs.2,65,79,550. Further, it is seen that excess deduction under section 80HHC has been allowed at Rs. 8,18,00....
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....sing Officer regarding escapement of income, is not based upon any new material or facts having come to his notice which is evident from the affidavit-in-reply made by the respondent wherein he has categorically stated that the return of income filed by the petitioner and the record of proceedings constitute tangible material to come to the conclusion that there was escapement of income from assessment. In the circumstances, it is apparent that the reopening of assessment under section 147 is nothing but a change of opinion on the same set of facts. Thus, the petitioner is justified in contending that if notice is issued for reopening proceedings after expiry of four years from the end of the relevant assessment year and no new material is there on the basis of which reopening of proceedings is initiated, the jurisdiction is not validly assumed. 14. From the facts emerging on record, there is nothing to indicate that the petitioner has withheld any particulars. The successor-Assessing Officer has verified the same record to come to the conclusion that there is escapement of income which could have been done at the initial stage itself. There is nothing on record to indicate....