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TaxTMI 
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2023 (8) TMI 724
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....tter of CWP No.4395 of 2016 pertains to A.Y. 2011-12 respectively. Since in all these writ petitions, the facts are identical and similar substantial questions of law have arisen for consideration, therefore, they are heard together and are being decided by this common judgment. 2. The common facts leading to filing of the above-mentioned writ petitions are that the petitioner-Company which is primarily engaged in the development, maintenance and operation of development of infrastructural facilities had been awarded a contract of infrastructure development of providing Lift Water Supply Scheme to PC Habitation of some constituencies in District Hamirpur and District Kangra (Himachal Pradesh) for operation and maintenance of a scheme for rehabilitation and source level augmentation of various scheme in hilly areas in District Kangra. This project which was composite in nature was awarded to the petitioner on built, operate and transfer basis vide letter dated 08.02.2007 by the Irrigation & Public Health Department, Government of Himachal Pradesh. The petitioner filed its income tax returns for the assessment years 2008-09, 2009-10, 2010-11 and 2011-12 on 24.09.2008, 28.09.2009, 28....
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.... in granting sanction for re-opening the assessment. There was tangible material on record to show that the income of petitioner for the assessment years 2008-09 to 2011-12 had escaped assessment within the meaning of Section 147 of the Act. It was alleged that the petitioner was infact engaged in works contract and not in development of infrastructure sector as it was provided only works contract service for the Government of Himachal Pradesh and was not making any investment itself and was just performing a part of composite contract with no independence to itself with respect to design and development. It was further alleged that since these facts had come to the notice of the assessing officer only while assessing the income of the petitioner for the A.Y. 2012-13 and since the petitioner had not made full and true disclosure about the nature of the work done by it at the time of filing of the returns, therefore, the re-assessment for the concerned years had rightly been ordered to be opened and no ground had been made out for challenging the re-opening of assessments as it was not based on change of opinion. While controverting the remaining pleas as taken in the petitions, dis....
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....pon authorities cited as Azim Premji Trustee Company Pvt. Ltd. v. Principal Commissioner of Income Tax-2 and others, (2022) 448 ITR (Karn.), Thanthi Trust v. ITO, (1989) 177 ITR 307 (Madras), Murlidhar Bhagwandas and Co. v. CIT, (1990) 181 ITR 319 (Bom), Commissioner of Income-tax, Delhi v. Kelvinator of India Ltd., (2010) 320 ITR 561, New Delhi Television Ltd. v. Deputy Commissioner of Income Tax, (2020) 116 taxmann.com 151 (SC) and State Bank of Patiala v. Commissioner of Income-tax, (2015) 59 taxmann.com 391 (Punjab & Haryana). 7. Per contra, it was submitted by learned counsel representing the revenue that the assessment for the relevant assessment years had been opened under Section 148 of the Act on the basis of information regarding wrong claim made by the assessee for availing the benefit under Section 80- 1A of the Act during the course of framing assessment for the A.Y. 2012- 13. It was submitted that challenge to the impugned notices dated 27.02.2015, 12/13.05.2015 and order dated 10.02.2016 was misconceived as the facts that the petitioner was provided only works contract service and was not involved in the business of infrastructure development and hence was not entit....
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....he part of the assessee to make a return under Section 139 or in response to the notice issued under Section 142 (1) or Section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year. 10. Further as per Section 149 of the Act, no notice under Section 148 shall be issued for the relevant assessment year, if four years have elapsed from the end of the such assessment year. 11. On a collective reading of above sections, it is clear that the right to take action under Section 147 is subject to the following conditions:- (i) The Income Tax Officer should have reason to believe that the income chargeable to tax has escaped proper assessment. (ii) He should have reason to believe that such escapement was by reason of omission or failure on the part of an assessee to disclose fully and truly all material facts for his assessment for that assessment year. (iii) He must issue a notice under Section 148 calling for a return of income within the time limit prescribed in Section 149. (iv) He must, before issuing such a notice, record his reason for doing so. 12. Learned counsel for the petitioner has argued that the assessment pro....
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....e-open the assessment beyond the prescribed period of four years. The burden is on the revenue to show that the escapement has occurred on account of failure on the part of the assessee to disclose the full particulars of the income. It is equally well settled that the assessee is under a duty or obligation to disclose only basic and primary facts relevant to the assessment and thereafter, it is for the assessing officer to make further inquiries and draw inferences but if he does not do so for any reason, then revenue cannot contend that there was any failure or omission on the part of the assessee. 14. In the instant case, the petitioner had been allowed deduction under Section 80IA of the Act for all the four relevant assessment years after thorough examination and on being satisfied that it was entitled to such claim. It was only while framing assessment for the A.Y. 2012-13 that the assessing officer has raised doubt with regard to terms of contract between the Government of Himachal Pradesh and the petitioner and had sought to re-open the assessment on the ground of non-eligibility of deduction under Section 80IA of the Act and taxability of the income tax recoverable by the....
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.... that the assessee was held entitled to claim deduction under Section 80IA of the Act, that the assessment order for the relevant year had been passed. It cannot be stated that the terms of contract and the nature of the contract between them had come to the notice of the assessing officer only while framing assessment for the A.Y. 2012- 13. The entire claim of the petitioner for deduction under Section 80IA of the Act had been examined and allowed by the assessing officer at the time of framing assessment for the relevant previous years. As such, in our opinion, it could not be claimed by the revenue that the assessee had not fully disclosed the facts. In this context, reference can be made to Azim Premji Trustee Company Pvt. Ltd.'s case (Supra) wherein it was observed by High Court of Karnataka that it was not for somebody else, far less the assessee, to tell the assessing authority what inferences, whether on facts and law should be drawn and it was for the assessing authority himself to decide what inferences of facts could reasonably be drawn and what legal inferences had ultimately to be drawn. When the information furnished by the assessee in the returns was sufficient f....
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....re-assessment proceedings initiated after four years from the end of the relevant year only on the basis of change of opinion, are liable to be set aside. Therefore, qua the A.Y. 2008-09 the re-assessment proceedings initiated beyond four years have become liable to be set aside on the ground of change of opinion and being time barred as well. Reliance can also be placed upon New Delhi Television Ltd.'s case (Supra) wherein similar observations were made. 17. Further, revenue was also required to show that there was direct nexus or live link between the material coming to the notice of the assessing officer or there was a formation of reasonable belief that income of the assessee has escaped assessment and otherwise, the said amounted to change of opinion only which was not permissible. It is well settled that opening of re-assessment proceedings on the basis of re-visiting the same claim which was raised previously, is certainly a mere change of opinion which cannot be permitted. Reliance in this regard can be placed upon Kelvinator of India Ltd.'s case (Supra), wherein it was held that assessing officer has no power to review; he had power to re-assess based on fulfilmen....
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....t had been given benefit of exemption under Section 80IA of the Act by the assessing officer, therefore, such notice was liable to be quashed, as the reasoning given by the assessing officer was based on the same material on which the original assessments had been framed. It is explicit from the record of the instant appeals that the assessing officer in this case had re-opened assessments by mere change of opinion with regard to the nature of contract between the assessee and Government of Himachal Pradesh, the contents of which were disclosed by the petitioner at the time of framing of original assessments for previous four consecutive assessment years. Therefore, issuance of notices on the same material does not meet the standards of "reason to believe" as it was only on a different analysis which was being done to draw a conclusion that income of the petitioner had escaped assessment, that these notices were issued though based on the same documents which were already tendered and this could not be permissible under the powers available to revenue under Sections 147 and 148 of the Act. 18. So far as the notices issued by the assessing officer qua assessment years 2009-10 to 20....