TaxTMI 
TaxTMI 
2023 (11) TMI 508
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....f the Act for Assessment Year ("AY") 2015- 16, notice dated 31st May 2021 under Section 148A(b) of the Act, notice dated 21st April 2021 for AY 2015-16 under Section 148 of the Act. 3. Facts giving rise to the present Petition are that Petitioner, a private company engaged in the business of undertaking real estate projects, sold a plot of land situated at Raigad District to one Regency Nirman Limited by a registered agreement to sell dated 7th October 2011 for a consideration of Rs. 18 Crores. The property was valued at Rs. 16.50 Crores for the purpose of stamp duty. It was agreed between Petitioner and the purchaser that in case Petitioner was unable to discharge any obligation under the agreement, damages shall be settled. Thus, on non-fulfilment of some obligations on the part of Petitioner, the consideration was reduced by Rs.6 Crores making the consideration payable for the land at Rs. 12 Crores. Petitioner e-filed its return of income on 31st March 2017 declaring income of Rs. 8,43,58,620/- and booked profits under Section 115JB of the Act at Rs. 9,72,27,472/-. An assessment order came to be passed on 26th December 2017 accepting Petitioner's figure of Rs. 12 Crores. In....
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....arch 2019 was received by the AO raising an objection that Petitioner has shown lower amount of sale consideration than value adopted by the Stamp Duty Authority thus, inviting the applicability of Section 50C of the Act to the transaction. Dr. Shivaram points out that a reply to the audit memo was given by the AO namely, one Mr. Rajesh Meshram explaining that Rs.6 Crores was reduced from the gross sale consideration of Rs. 18 Crores under Section 48 of the Act and hence, the sale consideration was higher than the stamp valuation. Relying on this reply, Dr. Shivaram contends that since this finding was already arrived at by the AO while passing the original assessment order as well as in the reply to the audit objection, Petitioner's income is not open to re-assessment on the basis of a change of opinion. Dr. Shivaram further contends that thus, approval given by the PCCIT, Mumbai is not tenable. He further draws our attention to the detailed objections filed by Petitioner to the notice dated 28th May 2022 that the AO had already considered the issue in original assessment proceedings. 7. Another important contention raised by Dr. Shivaram is the meaning of 'information' which....
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.... (Dead) thereafter by I.Ss. and Ors. (1969) 1 SCC 688 5) Chandrika Prasad (D) Thr. Lrs. and Ors. v. Umesh Kumar Verma and Ors. (2002) 1 SCC 531 6) Commissioner of Income-tax v. Kelvinator of India Ltd. [2010] 320 ITR 561(SC). 7) Siemens Financial Services (P.) Ltd. v. Deputy Commissioner of Income-tax [2023]154 taxmann.com 159 (Bom) 8) Union of India v. Ashish Agarwal [2022]138 taxmann.com 64 (SC). Accordingly, Dr. Shivaram urges the Court to quash the impugned order and the consequent notice issued by the Department. 9. Mr. Suresh Kumar relies upon the affidavit in reply filed by the Department and narrates the facts of the case. He says that while the AO had already dealt with the issue of long term capital gains relating to the sale of the plot of land and the consideration involved, an audit objection was raised which was also rebutted by the AO. However, ultimately in view of the remarks of the ACIT, the AO on the basis of re-verification has reviewed its earlier decision and accepted the audit objection raised in the case of Petitioner. He contends that if an audit objection is raised that the finding/decision of an AO is not in consonance wit....
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...."information" that suggests escapement of income was an internal audit objection. What is information is explained in Section 148 of the Act to mean "any objection raised by the Comptroller and Auditor General of India......." and no one else. This itself makes the re-opening of assessment in the present case impermissible. 12. Consequently, de-hors any audit objection raised by the CAG, a view deviating from that which was already taken during the course of issuing the original assessment order is nothing but a 'change of opinion' which is impermissible under the provisions of the Act. 13. In a decision of this Court itself in the matter of Bakhtawar (Supra) we have already held as follows: 18 This court in Commissioner of Income Tax-II Vs. Jet Speed Audio (P) Ltd. (2015) 55 taxmann has held that during the original assessment proceedings, once a query was made with regard to the same issue which was responded to by the assessee and on satisfaction of the same, the assessing officer has passed an assessment order, reopening would be purely on the basis of change of opinion. Moreover, the court has held that the tangible material urged should emanate from the reasons recorded f....
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....efore, this was a fit case for invoking provisions of Section 50C of the Act. This does not indicate about any opinion having been received by the assessing officer by way of audit objections. Therefore, we will also have to hold that there can be no tangible material mentioned in the reasons recorded by the revenue which would want a different opinion being taken than which was taken when the original assessment order was passed. As held by this court in Jet Speed Audio (P) Ltd. (Supra) it is settled law that the reopening notice can be sustained only on the basis of the ground mentioned in the reasons recorded. It is not open to the revenue to add and/or supplement later the reasons recorded at the time of reopening notice." In the matter of Kelvinator of India (Supra), the Apex Court held as under: "On going through the changes, quoted above, made to section 147 of the Act, we find that, prior to the Direct Tax Laws (Amendment) Act, 1987, reopening could be done under the above two conditions and fulfilment of the said conditions alone conferred jurisdiction on the Assessing Officer to make a back assessment, but in section 147 of the Act (with effect from 1st April, 1989), ....