2014 (6) TMI 470

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....l Member: This appeal by the Revenue is directed against the order of the Commissioner of Income-tax(Appeals) II, Hyderabad dated 10.07.2013 for the assessment year 2006-07. 2. Effective grievance of the Revenue in this appeal relates to legality and validity of the reopening of the assessment under S.147 of the Act. Grounds of the Revenue on this aspect read as follows- "1. The order of the CI....

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....rtain amount received by the assessee by way of long term capital gains, which was treated as exempt under S.54EC of the Act by the Assessing Officer in the assessment, as assessable under the head 'other sources'. We further find that the only issue with reference to correctness of the claim of exemption under S.54EC of the Income-tax Act, in respect of long term capital gains that arose on accou....

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.... of claiming exemption under S.54EC. To the above objection, on 2.2.2010, the Assessing Officer gave a very categorical reply stating that compensation was received for relinquishing the right of the assessee, which should be taxable as capital gains. The Assessing Officer did not accept the audit objection and requested the audit party to drop the objection. As the audit objection was not droppe....

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....which was received for relinquishment of the rights of the assessee in the property. Hence, we are of the opinion that the Assessing Officer had no reason to believe that there was escapement of income to initiate proceedings under S.147 of the Act. As held by the Supreme Court in the case of CIT V/s. Kelvinator India Ltd.(320 ITR 561), mere change of opinion cannot be a reason to reopen the asses....