TaxTMI 
TaxTMI 
2026 (6) TMI 1049
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....ring. 2. On 21.10.2019, the Coordinate Bench of this Court while granting ad-interim relief, has passed the following order: "1. Mr. S.N. Divatia, learned advocate for the petitioner, invited the attention of the court to the reasons recorded for reopening the assessment, to submit that the Assessing Officer seeks to reopen the assessment on the ground that the petitioner had claimed long term capital gain of Rs. 1,74,34,398/- and Rs. 18,09,019/- as exempt disallowance had been dividend income of income, however, no made of expenditure directly or indirectly incurred in relation to the exempt income earned during the year. It was pointed out that during the course of scrutiny assessment, the Assessing Officer had issued notice d....
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....s validity. 4. Having regard to the submissions advanced by the learned advocate for the petitioner, issue Notice, returnable on 09.12.2019. By way of ad-interim relief, the respondent is restrained from proceeding further pursuant to the impugned notice dated 30.03.2019 issued under section 148 of the Act for the assessment year 2012-13. Direct service is permitted today." 3. Today, when the matter is taken up for hearing, learned Senior Standing Counsel Mr. Yajnik is unable to controvert that at the time of filing of original Return of Income, the petitioner had disclosed the exempt income and accordingly, the details were given with regard to long term capital gain of Rs. 1,74,34,398/- under section 10(38) of the Inc....
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....ncome chargeable to tax has escaped assessment and that the same was occasioned on account of either failure on part of the assessee to make a return of his income for that assessment year or to disclose fully and truly all material facts necessary for that assessment year. In the present case, the entire material was available with the Assessing Officer during the original assessment and therefore, there was no failure on part of the assessee to disclose truly and fully all material facts necessary for assessment and based upon such material supplied by the petitioner, the Assessing Officer passed the original assessment order. Further, it appears that the notice for reopening is based upon the audit objection and there is nothing on recor....
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....cer has reason to believe that income has escaped assessment, confers jurisdiction to re-open the assessment. 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, Section 147 would give arbitrary powers to the Assessing Officer to re-open assessments on the basis of "mere change of opinion", which cannot be per se reason to re-open. We must also keep in mind the conceptual difference between power to review and power to re-assess. The Assessing Officer has no power to review; he has the power to re-assess. But re-assessment has to be based on fulfillment of certain pre-condition and if the concept....