TaxTMI 
TaxTMI 
2022 (5) TMI 1266
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....ight to add, amend, or alter any grounds of appeal at any time of hearing." 2. Succinctly stated, original assessment was framed by the A.O vide his order passed u/s.143(3) of the Act dated 13.12.2010 determining the income of the assessee at Rs.6,02,300/-. Subsequently, the case of the assesee was reopened by the A.O u/s. 147 of the Act for the following "reasons to believe": In this regard, as per your request for providing the reason for reopening/ re- assessment of the case u/s 147 of the IT Act for the A.Y. 2008- 09 is as furnished below. 1. An amount of Rs.2,75,375/- (which is included in the total figure of Rs.9,44,993/-) in the name of Shri Mahendra Kochar was shown under the head loans, advances & deposits but the same was not found in the closing balance of said person in the conformation of account submitted by you, hence the said bogus debtor in the name of Shri Mahendra Kochr is required to be disallowed and added back to your income u/s 69 of Income 'Tax Act' 1961. Further as Shri Mahendra Kochar has made repayment of loans amounting to Rs.2,90,275/- in cash has violated the S. 269T. 2. In the case of Smt. Tara Bai jain it has been noted that interest, ....
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....nge of opinion", traversed beyond the scope of his jurisdiction and dislodged the concluded assessment that was earlier framed by his predecessor vide order passed u/s.143(3), dated 13.12.2010. In order to buttress his aforesaid contentions the Ld. AR had drawn our attention to the copy of "reasons to believe" on the basis of which the case of the assessee was reopened u/s.147 of the Act, Page 6-7 of APB. It was claimed by the Ld. AR that a perusal of the "reasons to believe" as were made available to him by the A.O vide his letter dated 30.06.2015, reveals beyond doubt that reopening of the concluded assessment of the assessee was carried out on the basis of a mere "change of opinion" for reviewing the earlier order so passed by him. It was submitted by the Ld. AR that as reopening of the concluded assessment is based on a mere "change of opinion" which is not permissible as per the mandate of law, therefore, the order passed u/s.143(3)/147, dated Nil being devoid and bereft of any force of law was liable to be quashed on the said count itself. 7. Per contra, the Ld. Departmental Representative (for short 'DR') relied on the orders of the lower authorities. It was submitted by th....
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....ne needs to ITA No.1212/Mum/2019 A.Y. 2012- 13 M/s Medley Pharmaceuticals Ltd. Vs. DCIT-10(2)(2) give a schematic interpretation to the words "reason to believe" failing which, we are afraid, s. 147 would give arbitrary powers to the AO to reopen assessments on the basis of "mere change of opinion", which cannot be per se reason to reopen. We must also keep in mind the conceptual difference between power to review and power to reassess. The AO has no power to review; he has the power to reassess. But reassessment has to be based on fulfilment of certain pre-condition and if the concept of "change of opinion" is removed, as contended on behalf of the Department, then, in the garb of reopening the assessment, review would take place. One must treat the concept of "change of opinion" as an in-built test to check abuse of power by the AO. Hence, after 1st April, 1989, AO has power to reopen, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief. Our view gets support from the changes made to s. 147 of the Act, as quoted hereinabove. Under the Direct Tax Laws (Ame....
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....ment. Though, in the notice respondent No. 1 has used the phrase "reason to believe", admittedly between the date of the order of assessment sought to be reopened and the date of forming of opinion by respondent No. 1, nothing new has happened and there is no change of law, no new material has come on record, no information has been received. It is merely a fresh application of mind by the same officer to the same set of facts. Thus, it is a case of mere change of opinion, which, in our opinion, does not provide jurisdiction to respondent No. 1 to initiate proceedings under s. 148 of the Act. It can now be taken as a settled law, because of a series of judgments of various High Courts and the Supreme Court, which have been referred to in the judgment of the Full Bench of the Delhi High Court in the case of Kelvinator of India Ltd. (supra) referred to above, that under s. 147 assessment cannot be reopened on a mere change of opinion." We further find that the Hon'ble High Court of Bombay in the case of Asian Paints Ltd. Vs. DCIT (2008) 308 ITR 195 (Bom) had observed, that as no new information /material was received by the A.O, therefore, the fresh application of mind by him to....
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....assessment and a mere change of opinion would not justify a recourse to the power under s. 147. Unless the AO has tangible material to reopen an assessment, the power cannot be held to be validly exercised. The Supreme Court has held thus : "...Therefore, post-1st April, 1989, power to reopen is much wider. However, one needs to give a schematic interpretation to the words "reason to believe‟ failing which we are afraid s. 147 would give arbitrary powers to the AO to reopen assessments on the basis of "mere change of opinion‟, which cannot be per se reason to reopen. We must also keep in mind the conceptual difference between power to review and power to reassess. The AO has no power to review; he has the power to reassess. But reassessment has to be based on fulfilment of certain precondition and if the concept of "change of opinion‟ is removed, as contended on behalf of the Department, then, in the garb of reopening the assessment, review would take place. One must treat the concept of "change of opinion‟ as an inbuilt test to check abuse of power by the AO. Hence, after 1st April, 1989, AO has power to reopen, provided there is "tangible material‟....