TaxTMI 
TaxTMI 
2026 (4) TMI 1477
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....e Tax Act, 1961 (hereinafter referred to as the 'Act), for the A.Y. 2014-15, wherein ld CIT(A) has allowed assessee's appeal deleting the addition of Rs. 8,39,06,087/- on account of suppression of sales. 2. The brief facts state that the assessee is the partnership firm engaged in the business of procurement of milk from small milk suppliers of nearby places and supplies the same immediately to milk processing units i.e. V.R.S Foods Ltd, Sterling Agro Industries Ltd, Hardayal Milk Products, Bhole Baba Milk Food Industries Ltd etc. The original return for A.Y. 2014- 15 was filed on 25.09.2014, declaring income of Rs. 19,07,464/-. The original assessment was completed u/s. 143(3) of the Act on 09.11.2016, assessing total income at Rs. 21,0....
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....s the original order dated 09.11.2016 contains no such discussion and the trading results were accepted merely on the basis of comparative net profit, with the AO having examined the books only on a limited test-check basis and not through a detailed verification. 2. That the CIT(A) erred in law and on facts in holding the reopening invalid and quashing the reassessment order dated 30.03.2022 by wrongly concluding that the assessee had not failed to disclose material facts and that no fresh material existed, without appreciating that no specific query regarding the sale price average sale price of milk was raised during the original assessment, that Explanation 1 to the proviso to section 147 clarities that mere production of books....
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.... appreciating the fact that no opinion of suppression of sales was ever formed during the original assessment. Ld PCIT, thus, supports the reassessment order and prays to quash the impugned order. 8. Ld representative for the respondent assessee has argued that the ld CIT(A) has rightly quashed the reassessment proceedings, which were based on the "change of opinion", prayed to dismiss revenue's appeal. 9. The perusal of records transpires that the original assessment for the assessment year 2014-15 was completed on 09.11.2016 u/s. 143(3) of the Act. According to the assessing officer, the case was reopened u/s. 147 of the Act by issuance of a notice u/s. 148 of the Act dated 30.03.2021, on account of suppression of sales of milk to t....
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....ors and sundry creditors, bank statements and gross profit comparison chart along with books of accounts. All these details were duly verified by the ld assessing officer, while finalizing assessment in the original assessment proceedings and no adverse findings were recorded. Ld CIT (A) has accepted assessee's arguments that the issue regarding business results, whether it was purchase price or sale price, was already considered during the original assessment proceedings. Ld CIT(A) has observed that assessee's case was selected for limited scrutiny to examine the aspect of (i) low net profit or loss shown from large gross receipts and mismatch in amount paid to related persons u/s. 40A(2)(b) of the Act. Assessee's reply filed during the as....
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....purchase price and the sale price was available with the assessing officer at the time of original assessment. According to the first appellate authority, the reopening of the assessment on the basis of aforesaid reasons alone amounted to "change of opinion". Ld CIT(A), while holding as such, took strength from Maharaj Kumar Kamal Singh v. CIT[1959] 35 ITR 1 (SC), Anderton and Halstead Ltd v. Birrell [1932] 1 K.B. 271, CIT v. Sir Mahomed Yusuf Ismail[1944] 12 ITR 8(Bom.) etc. 14. Ld CIT(A) has further referred CIT v. Kelvinator of India Ltd. [2010] 320 ITR 561/187 Taxman 312(SC) [affirming CIT v. Kelvinator of India Ltd[2002] 256 ITR 1/123 Taxman 433 (Delhi) (FB)], wherein it was held that the concept of "change of opinion" must be treat....