TaxTMI 
TaxTMI 
TaxTMI 
2017 (6) TMI 603
X X X X Extracts X X X X
X X X X Extracts X X X X
...., the petitioner seek to rely upon the judgment of the Supreme Court in the matter of : GKN Driveshafts (India) Limited Vs. Income Tax Officer, (2003) 1 SCC 72. 2.1. It is pertinent to note, at this stage, that it is the petitioner's case that change in opinion has occurred with respect to an immovable property located at Kovalam village, Thiruporur Taluk, Chengalpet District (for the sake of convenience hereafter referred to as Kovalam Property ). This property, evidently, at the relevant point in time, was held jointly by the petitioner, along with his sons; each having 1/3rd share in it. The said property was sold and, since, according to the petitioner, it was an agricultural land, it was not a capital asset, to which the provisions of the Act would apply, and hence, income derived upon its sale, was not included by him in his taxable income. 2.2. The record shows that a notice under Section 148 of the Act was issued to the petitioner on 30.03.2015, on the ground that income derived from the sale of the Kovalam property had escaped assessment, by reason of the failure on the part of the petitioner to disclose fully and truly of all material facts. 2.3. It is, this aspect....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... The property/being an agricultural land and not coming under the purview of capital asset. The profit on sale of such land is away from the ambit of taxation. ...." 6.4. As is obvious, the assessment order dated 30.11.2010, followed the letter dated 09.11.2010, whereby, inter alia, the aforementioned information was supplied by the petitioner qua the Kovalam property. 6.5. As indicated above, the respondent issued a notice dated 30.03.2015, under Section 148 of the Act, just before the period of limitation of six years was to expire. By this notice, the petitioner was called upon by the respondent to file a return, within thirty (30) days of its service, in the prescribed form, in respect of income, which, according to him, was assessable qua the AY. 6.6. The petitioner responded to the aforementioned notice, via a reply, which was received by the Department on 01.05.2015. The petitioner reiterated that to the best of his knowledge, no income had escaped assessment. It was emphasised that no reasons were furnished for issuance of the notice under Section 148 of the Act, and therefore, the return filed by him should be treated as a response to the notice issued under Section 148....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rue character of the land, as it was not the conclusive evidence. Therefore, what was attempted to be emphasised was that, the parcel of land would still be agricultural land, if valuable plants, or crops, or trees planted on it are found, or, if, it was used for the purposes of husbandry. 7. The respondent, however, was not impressed with the submissions made by the petitioner, and thus, vide communication dated 04.02.2016, rejected the objections/ contentions raised by the petitioner. Pertinently, in the very same communication dated 04.02.2016, in so far as the objections raised by the petitioner with regard to the fact that no reasons were furnished, while issuing notice under Section 148 of the Act, the respondent had the following to state : ".... The reasons for reopening were communicated to the AR of the assessee and subsequently, a notice u/s 143(2) was issued dated 30.10.2015 to continue with the scrutiny proceedings. ...." 8. On receipt of the communication dated 04.02.2016, the petitioner once again wrote to the respondent, albeit, via his Chartered Accountants, vide letter dated 17.02.2016. Via this communication, the petitioner refuted the fact that reasons were ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s. It was further averred that the Kovalam property, was also subject matter of an assessment order, passed under Section 143(3) of the Act vis-a-vis one of his sons, i.e. Mr.Mohammed Anas, despite which, no proceedings were initiated against him under Sections 147 and 148 of the Act, which was in stark contrast to the steps taken by the Revenue in the petitioner's case. The argument, being that the Revenue was not acting evenhandedly in so far as the petitioner was concerned. 9.2. It was further submitted by the learned counsel for the petitioner that there was no definition of agricultural land given in the Act, and that, only the definition of agricultural income under Section 2(1A) of the Act, indicated, as to what was meant by agricultural land. It was stated that the Act, specifically, excluded from the definition of capital asset (as contained in Section 2(14) of the Act), agricultural land, save and except land, which, fulfilled the conditional set out in sub-clauses (a) and (b) of Clause (iii) of Section 2(14) of the Act. Since, the Kovalam property did not come within the exception carved out in Section 2(14) of the Act, it could not be treated as land, which was not....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ention, in this behalf, was drawn by Ms.Muralikrishnan to the response received by the respondent qua, the enquiries made from the Tahsildar, Thiruporur. Based on the communication dated 06.01.2016, addressed by the Tahsildar to the respondent, it was submitted that no agricultural activities had been carried out by the petitioner between 2003 and 2007, and therefore, the respondent had rightly concluded that the subject land was not an agricultural land. 10.2. In sum, it was the learned counsel's submission that this was not a case of change of opinion, since, no enquiry had been carried out, at a point in time, when, the original assessment order was passed and, therefore, the respondent was well within his power to pass a re-assessment order under Section 147 of the Act. 10.3. I must note herein that in the counter affidavit, the respondent relied upon the following judgments : (i).A.L.A. Firm V. CIT ; (1976) 112 ITR 622 ; (ii).Revathy C.P. Equipments Ltd. V. DCIT, 241 ITR 856 (Mad); (iii).Kalyanji Mavji and Co. V. CIT, (1976) 102 ITR 287 (SC); and (iv).Smt.Sarifabibi Mohmed Ibrahim and Others V. CIT, (1993) 114 CTR 0467; Reasons : 11. I have heard the learned co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cultural, in my view, would not suffice, as the reasons, which, the respondent was obliged to furnish, due to the mandate of law, would, ordinarily, have to state as to why he had proposed to treat the Kovalam property as non-agricultural land. 13.3. The purpose of furnishing reasons is to enable the Assessee to effectively meet the charge levelled against him. Therefore, in so far as this aspect is concerned, the submission advanced on behalf of the Revenue cannot be accepted. 14. In so far as the second aspect is concerned, the stand taken on behalf of the respondent is that no enquiry was caused, as regards the nature of the subject land, i.e., Kovalam property, when, the original assessment order was passed. As indicated in my narration above, while, concluding the assessment proceedings qua the petitioner under Section 143(3) of the Act, the queries were raised by the respondent, as regards various issues, including those which pertained to the Kovalam property. The fact that queries were raised is reflected in the letter dated 30.10.2010 and 09.11.2010, sent on behalf of the petitioner, by his Chartered Accountants. 14.1. A perusal of the communication dated 09.11.2010, wo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he given facts and circumstances. The record shows that query was raised, pursuant to which, information was supplied by the petitioner; a circumstance, which is, suggestive of the fact that an enquiry was made with regard to the subject transaction. 14.6. These facts would, clearly, bring the case within the four corners of the expression, change of opinion . In this behalf, I may only quote with profit the following observations made by the Full Bench of the Delhi High Court in CIT V. Usha International Limited, (2012) 348 ITR 485 (Del) : ".... 57. Frankly, I am unable to see any difference between a case where a query is raised by the Assessing Officer which is replied to by the assessee with supporting evidence or material, but the opinion of the Assessing Officer on the assessee's reply is not recorded in the assessment order, and a case where even without a query from the Assessing Officer, the assessee voluntarily discloses full and true particulars necessary for his assessment, which are not referred to in the assessment order and the opinion of the Assessing Officer has not been expressly recorded therein. The distinction which was sought to be made on behalf of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ies in a perfunctory manner. The ratio of the judgment is rooted to the salutary principle that the assessees shall not be subjected to harassment if they have furnished full and true particulars at the time of the original assessment, which is what the Supreme Court observed in the judgment in Srikrishna Pvt. Ltd. (supra). It certainly does not imply that every assessment order passed under section 143(3) without an elaborate discussion of various contentions and claims put forth by the assessee is necessarily a wrong order to be corrected later by resorting to section147. Making an assessment to income tax represents the quantification of the charge to tax; it is a serious task. Legal consequences follow. A return of income is not a mere scrap of paper. It is to be treated with the respect it deserves. I think the real principle laid down by the Full Bench in Kelvinator (supra) is that if the assessee has discharged his duty of furnishing full and true particulars at the time of the assessment, it may be fairly taken that the assessing officer has equally discharged his functions in the manner required of him. If he passes an assessment order under section 143(3) of the Act, it h....