TaxTMI 
TaxTMI 
2016 (2) TMI 1095
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....e on which reopening was undertaken. 2. Briefly stated, assessee is an individual and has admitted income of Rs. 5,62,047/- originally. The AO in the course of scrutiny assessment, specifically issued a Show Cause Notice to assessee about the deposits made in the bank account vide letter dt. 16-08-2007. Assessee vide reply filed on 22-10-2007 dt. 05-10-2007 has replied that his close friend one Mr. K. Rajender Rao had opened the account as his bank account has become inoperative due to default to the bank on the agricultural term loan taken for establishing a poultry farm. Since proceedings of one time statement (OTS) was going on, the said Mr. K. Rajender Rao approached assessee to open account with the said bank and the transactions in....
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....the reassessment questioning that the reopening is on mere presumptions and without having any reason to believe and mere change of opinion. Assessee also questioned the addition of an amount of Rs. 15,77,300/- as 'income from other sources'. Ld. CIT(A) in his brief order, without extracting any of the submissions made by assessee, dismissed the appeal stating that appellant has taken a hyper-technical view in the submissions made. He also confirmed the addition made stating that it is 'suitably disallowed'. He accordingly confirmed 'disallowance' made by the AO. 3. Ld. Counsel referring to the Paper Book placed on record submitted that the entire issue of deposits in the bank account was examined by the Dy. CIT in the course of assessme....
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....or scrutiny is the information from CIB that there were cash deposits in the bank account. There is evidence on record that the then AO did enquire and was satisfied about the claim of assessee that the transactions pertain to another person. In view of the above, the subsequent reopening after four years from the end of the assessment year is not proper and is not justified according to the law on this issue. It is also a case within the purview of 'change of opinion'. In CIT Vs. Usha International Ltd., [348 ITR 485], the Full Bench of Hon'ble Delhi High Court laid down the following propositions of law: "(i) the expression "change of opinion" postulates formation of opinion and then a change thereof. In the context of sectio....
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....se to the notice u/s. 142(1) or u/s. 148 and he failed to disclose truly and fully all material facts necessary for the assessment. ii. Once the case of assessee is not covered by the first proviso to Section 147, re-assessment proceedings beyond the period of four years from the end of the relevant assessment year would be without jurisdiction and bad in law; 7. As seen from the assessment record, the question examined during the course of assessment proceedings indicate that AO has applied his mind to the deposits in the bank account and did enquire about the genuineness of the transactions. It is evident that the AO has examined the issue originally and was satisfied with the explanation given by assessee. Therefore, any opin....
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.... to tax the amount is on the basis of change of opinion and it is not permissible, as the AO has accepted the same and completed the assessment in terms of Section 143(3). Moreover, as already stated earlier, the reopening is after 4 years and there is no failure on the part of the assessee to make full disclosure. On the same material furnished by assessee, the reopening was done, which cannot be sustained. 9. We are surprised by the way the Ld. CIT(A) decided the issue. In order to examine how he has dealt with submissions of assessee, it is necessary to extract para 5.1: "5.1 The order of AO and written submissions of the appellant were gone through and considered. The appellant in the assessment proceedings failed to substan....