TaxTMI 
TaxTMI 
2021 (9) TMI 323
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.... under the Companies Act having its registered office at Rajasthan, from M/s.Parry Enterprises Ltd. Prior to the acquisition of shares, the petitioner owned the balance 19% of the shares of GTPL. The entire consideration for acquiring the 81% was paid by the petitioner to M/s.Parry Enterprises Ltd on 16.07.2008. On completion of the acquisition of shares, GTPL became a subsidiary wholly owned by the petitioner on its own and through its nominee shareholder. 3. After the acquisition of the shares, the petitioner and GTPL approached Hon'ble Madras High Court and Hon'ble Rajasthan High Court praying for the proposal of GTPL merging into the petitioner. The Hon'ble Madras High Court and Hon'ble Rajasthan High Court vide orders in C.P.No.16 of 2008 dated 20.02.2009 respectively, approved the scheme of amalgamation with effect from 01.04.2008. 4. The petitioner states that for the assessment year 2009 -10, the petitioner filed its return of income under Section 139 (1) of Act electronically on 26.09.2009. In the said return of income, the petitioner had claimed set off of the brought forward losses of Rs. 11,06,85,208/- and unabsorbed depreciation of Rs. 4,95,78,646/-. ....
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....ess adjusted by you by an amount of Rs. 0.40 Cr. (pertaining to A.Y.2005 - 06), which is hereby proposed to be added to the total income." Therefore, it is proposed to be added to the total income. The petitioner in letter dated 19.03.2013 furnished the details regarding unabsorbed depreciation of amalgamating a company which reads as under: "3. Unabsorbed depreciation of the Amalgamating Company: The claim of carry forward loss represents the loss of the amalgamating company viz, Glamouroom Taps Private Limited. The loss has been reckoned based on the claim made by the amalgamating company in their income Tax Return for Assessment Year 2005 - 06. It may be noted that the difference in the figure of loss as was allowed by the Assessing Officer was due to the fact that there were certain additions / disallowance made in the assessment of the amalgamating company and the same issue was allowed by the Tribunal by setting aside the order of the Assessing Officer. We therefore submit that the claim of loss of Rs. 1,65,44,751/- relating to the Assessment year 2005 - 06 which is set off as per out Return of Income is in order and no adjustment is required to be made." 8. In another l....
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....nto consideration and based on the said reply a factual inference is drawn, which is relied on for the purpose of reopening of assessment. 11. The learned counsel for the petitioner made a submission that such an inference drawn is nothing but a change of opinion. As the issue regarding the amalgamation was elaborately considered by the Assessing Officer and there was no material afresh for the purpose of reopening of assessment that too beyond the period of four years. The impugned order dated 15.09.2016 is also not in consonance with the established principles, in view of the fact that the respondents no doubt elaborated the scope of Section 147 in the impugned order. However, in the present case, in the absence of any tangible material and as well as the failure on the part of the assessee, there cannot be any reason for reopening of assessment. Thus, the impugned orders are liable to be set aside. 12. The learned Standing Counsel appearing on behalf of the respondents disputed the contentions by stating that admittedly the reopening of assessment has been initiated beyond the period of four years but within six years. However, the reasons furnished for reopening of assessment....
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....tipulated under proviso Clause (c) of explanation 2 to Section 147 of the Act is to be complied. Mere reason to believe is insufficient for the purpose of assessment beyond the period of four years. Thus, if the Assessing Officer has reason to believe for reopening of assessment and such reopening is to be initiated beyond four years, then, the Assessing Officer must satisfy himself that the Assessee has failed in its duty to disclose fully and truly all the materials and in the absence of such conditions, it is to be construed that such reopening is violative of proviso Clause (c) of explanation 2 to Section 147 of the Act. 16. Regarding the change of opinion, the principles are considered by the Constitutional Courts in numerous judgments. However, if the materials are already taken into consideration while passing the Assessment Order, as per provision to Section 147 to Explanation (1): the mere production of books of accounts, materials are insufficient, but the deliberation made by the Assessing Officer at the time of Original Assessment would be relevant to form an opinion that, whether the reasons furnished are for change of opinion or otherwise, and two circumstances may b....
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....Section 2(1B), as it has an ordinary take over of business by acquiring shares. Therefore, question would arise, whether such an inference can be considered as a new information or tangible material. In this regard, such an opinion would have possibly taken by the Original Assessing Authority at the time of passing an Assessment Order. However, the Assessing Authority, while passing the original Assessment Order considering the very same materials as well as the informations provided and the Court Orders formed an opinion that it is a case of amalgamation. Thereafter, they are again forming an opinion that the transaction does not come under purview of Section 2(1B) of the Income Tax Act and it is an ordinary takeover of business by acquiring shares. Thus, where two opinions are possible in respect of a particular transaction and the Assessing Authority formed a particular opinion and passed an Assessment Order and the other opinion later on formed for the purpose of reopening of assessment beyond four years from and out of the same materials without any alteration or change, then such opinion formed at later point of time, undoubtedly to be construed as 'change of opinion'....