2007 (8) TMI 325

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....andi./2003 relating to the assessment year 1994-95 has been challenged. The assessee has claimed that the following substantial questions of law arise for consideration of this court : "1. Whether, on the facts and circumstances of the case, the orders dated December 12, 2005 (P-1) and dated November 3, 2000 (P-4), are legally sustainable? 2. Whether the Assessing Officer has validly assumed jurisdiction under section 147 of the Act? 3. Whether the Tribunal is correct in law in holding that the notice issued under section 148 of the Act for reopening the assessment already completed does not amount to change of opinion? 4. Whether, on the facts and circumstances of the case, the order disallowing the deduction under section 80-I....

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...., in response to which the assessee filed return declaring income at Rs. 37,69,485 on March 5, 1999. The Assessing Officer made the assessment under section 143(3) read with section 147 of the Act at Rs. 47,11,857. The assessee-appellant feeling aggrieved against the action of the Assessing Officer filed appeal before the Commissioner of Income-tax (Appeals), who, vide its order dated December 30, 2002, held the reassessment proceedings illegal and ordered to delete the addition made by the Assessing Officer on account of disallowing the deduction under section 80-I of the Act. The Revenue took the matter in appeal before the Tribunal and the Tribunal, vide its order dated December 12, 2005, set aside the order of the Commissioner of Income....

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....stated to be a plenary power. The Assessing Officer can assume jurisdiction under the said provision provided there is sufficient material before him. He cannot act on the basis of mere whim and fancy, and the existence of material must be real. Further, it is settled law that on discovery of new and important matter or knowledge of fresh facts which were not present at the time of original assessment would constitute "reason to believe that any income chargeable to tax has escaped assessment" within the meaning of section 147 of the Act and the same cannot be said to be mere change of opinion. 8. The Tribunal while restoring the matter to the file of the Commissioner of Income-tax (Appeals) decided the issue on the merits regarding the ....