TaxTMI 
TaxTMI 
2018 (3) TMI 1211
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....nclusion reached by the Supreme Court in 203 ITR 456, the Tribunal is legally and factually correct in holding that the reassessment is without jurisdiction,illegal and time bared. 2. Whether, on the facts and in the circumstances of the case and really and factually the credits being bogus and the same being factually known to the Revenue only subsequent to the completion of the original assessment, the Tribunal is right in law and facts in interfering with the reassessment. 3. Whether, on the facts and in the circumstances of the case and factually and in reality the credits being bogus will not the finding of the Tribunal in paragraph 27 that the 'the Assessee has produced every material before the Assessing Officer on the basis of which the Assessing Officer himself has concluded that the said six alleged bogus parties were registered dealers and some of the payments were made by cheques and some by cash" throw light on the ignorance and lack of knowledge of the Assessing Officer reached in the original assessment on the basis of the untrue material produced by the assessee? 4. Whether, on the facts and in the circumstances of the case the Tribuna....
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....Chand Bajrang Lal v. I.T.O. [(1993) 203 ITR 203]. It was argued that there was non-disclosure fully and truly of material facts in so far as the assessee having shown in the books of accounts persons who were not in existence, as dealers from whom the assessee had purchased goods. There can also be no contention raised of change of opinion since there has been no finding on facts with regard to the existence of the six dealers and only on subsequent information received, the re-assessment proceedings were taken up for bringing to tax the income escaped assessment . 5. The learned Counsel appearing for the respondent, however, asserted that reassessment of the assessee in the subject year, is clearly a case of change of opinion and there could not be any allegation of non-disclosure fully and truly of material facts. The learned Counsel would take us through the original assessment order and the Tribunal's order to indicate that there was a finding that the six dealers were registered dealers and existing in places where there were no banking facilities. It is also pointed out that the Assessing Officer in a letter addressed to the assessee, while the regular assessment proce....
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....ased on the aforementioned statements made in the assessment order, that the Tribunal allowed the claim of the assessee affirming the order of the first appellate authority. The Tribunal has found that the Assessing Officer, at the time of original assessment had made detailed enquiries in respect of payments made to the six parties and made dis-allowances in respect of cash payments under Section 40A(3). We do not think such an enquiry was made at the time of assessment especially when the disallowance of 20% of expenses was for reason of the expenditure otherwise than by cheque or draft and not on any suspicion raised of the existence of the dealers. 9. There never arose a question of the genuineness or existence of the dealers, to whom such payments in cash were made at the time of regular assessment. What can be discerned from a reading of the assessment order, at best, is that the Assessing Officer found the towns, in which the dealers were said to be existing, having proper banking facilities. The question to be decided was only as to whether there was any reason why the payments were made in cash and not by cheque or draft. This does not necessarily require an enquiry as ....
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....In Kelvinator of India Ltd, the reassessment was proposed inter alia seeking to disallow rent and depreciation, which were earlier allowed under Section 30 and 32 of the IT Act in regular assessment. The re-assessment was made confirming the addition of the rent and depreciation relying also upon the order of the Commissioner of Income Tax (Appeals) for the assessment year 1986-87, the previous assessment year. It was contended by the Department that the reassessment was also on the basis of the tax audit report. The Full Bench of the Delhi High Court found that the assessment was re-opened on 20.04.1990, whereas the first appellate authority's order was on 27.07.1990. In such circumstance, there was no possibility of the re-opening having been made on the basis of the first appellate authority's order, which was later to the re-opening. It was also found that the tax audit report was already available in the files and, hence, there could not have been a re-opening on that basis. While setting aside the re-opening, a reservation was made in the following words: "We, however, may hasten to add that if "reason to believe" of the Assessing Officer is founded on an inf....
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....hence, he could not be held liable to only that which is specifically expressed in the assessment order, was the finding. However, if new facts, material or information comes to the knowledge of the Assessing Officer, which were not on record and available at the time of regular assessment, the principle of "change of opinion" was held to be not applicable. It was specifically held: "Opinion" formed or based on wrong and incorrect facts or which are belied and untrue do not get protection and cover under the principle of "change of opinion" (sic). In the instant case, the aforesaid dictum squarely applies. The Assessing Officer considered the expenditure of payments made to suppliers and a dis-allowance was made to the extent of 20%, wherein money transaction was made other than by way of cheque or draft. The explanation of the assessee that the suppliers did not have access to banking facility was specifically declined noting the address of the suppliers furnished by the assessee. There was no further enquiry made, which is evident from the assessment order. The re-assessment was on the basis of the report of the I.T.O., Tirupur pointing out that six dealers to whom pa....