ASSISTANT COMMISSIONER OF INCOME TAX 17(2)), MUMBAI V. NAVJBAI RATAN TATA TRUST, MUMBAI

ITA 1317/MUM/2018

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 9824 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 04-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JACINTA ZIMIK VASHAI
• Keywords: Depreciation; Charitable institution; Maximum Marginal Rate; Question of law; Difference of opinion; Assessment record; Reason to believe; Change of opinion; Capital Gains
• Section: 12; 10; 11(1A); 192; 13; 10(23C)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, ‘B‘ BENCH MUMBAI BEFORE: SHRI M.BALAGANESH, ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No.1317/Mum/2018 (Asse ssment Year : 2008-09) Asst. Commissioner of Income Tax-17(2), Room No.134A, Aayakar Bhavan, M.K.Road, Mumbai – 400 020 Vs. M/s. Navajbhai Ratan Tata Trust Bombay House Homi Mody Street Mumbai – 400 001 PAN/GIR No.AAATN0202B (Appellant) .. (Respondent) ITA No.1299/Mum/2018 (Asse ssment Year : 2008-09) M/s. Navajbhai Ratan Tata Trust Bombay House 24, Homi Mody Street Mumbai – 400 001 Vs. Asst. Commissioner of Income Tax-(Exemptions)-2(1) (Now assessed by Asst. Commissioner of Income Tax-17(2), Piramal Chambers, Lalbaug Parel, Mumbai – 400 012 PAN/GIR No.AAATN0202B (Appellant) .. (Respondent) Revenue by Ms. Jacinta Zimik Vashai Assessee by Shri Percy Pardiwala Date of Hearing 16/11/2021 Date of Pronouncement 24/01/2022 ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 2 आदेश / O R D E R PER M. BALAGANESH (A.M): These Cross appeals in ITA Nos.1317/Mum/2017 & 1299/Mum/2018 for A.Y.2008-09 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-6, Mumbai in appeal No.CIT(A)- 6/IT-07/156/2017-18 dated 16/12/2017 (ld. CIT(A) in short) against the order of assessment passed u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 10/02/2015 by the ld. Asst. Commissioner of Income Tax (E), 2(1), Mumbai (hereinafter referred to as ld. AO). Identical issues are involved in both these appeals hence, they are taken up together and disposed of by this common order for the sake of convenience. ITA No.1299/Mum/2018(A.Y.2008-09) Assessee Appeal 2. The ground Nos.1-3 raised by the assessee in its appeal are challenging the validity of re-assessment proceedings and assumption of jurisdiction by the ld. AO u/s.147 of the Act. 3. We have heard rival submissions and perused the materials available on record. We find that assessee is a public charitable trust registered under Bombay Public Trust Act, 1950 and also registered under Income Tax Act. The return of income for the A.Y.2008-09 was filed by the assessee on 29/09/2008 alongwith income and expenditure account, balance sheet and audit report in form No.10B declaring total income at Rs. ‘Nil’ and also declaring a deficit of Rs.4,51,54,962/-. The assessee ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 3 claimed exemption u/s.11 of the Act in its return. The assessee also received dividend income which was claimed as exempt u/s.10(34) of the Act in the said return of income. The original assessment was completed u/s.143(3) of the Act on 26/11/2010 accepting the claim of the assessee. Later, the assessment was sought to be reopened by issuance of notice u/s.148 of the Act on 20/01/2014. Admittedly, this reopening of assessment was made beyond a period of four years from the end of the relevant assessment year. The reasons recorded by the ld. AO for reopening the assessment are reproduced hereunder:- A) The assessee filed its return of income on 29.09.2008 declaring deficit of Rs.4,51,54,962 after claiming accumulation u/s.11(1)(a) of Rs.54,56,784/-. Scrutiny assessment was completed in the case on 26.11.2010 assessing the total income at Rs.NIL. Section 11(1A) of the Income Tax Act, 1961 provides that when a capital asset, being property held under Trust is transferred resulting in capital gain, and if such sale proceeds are utilized for acquiring another capital asset, then the capital gain shall be deemed to be applied for the objects of the Trust. If only part of the sale proceeds are reinvested, the excess of the re-investment over the cost of the transferred asset is deemed to be applied and qualifies for exemption. The Calcutta High Court, in the case of CIT vs. East India Charitable Trust (1996) 206 ITR 152 has held that the term “income” includes capital gains, and therefore it may be invested within the same year or the next year, as contemplated in the explanation to section 11(1). Section 15(1)(d) provides that the income of any public trust will not be exempt u/s.11 if it holds for any period during a previous year any shares in a company (other than shares in a public sector company or shares as prescribed u/s.11(5)(xii). Further, proviso to Section 164(2) provides that the portion of income not exempt u/s.11 or 12 by virtue of the fact that any funds of the trust have not been invested or deposited for any part of the year in consonance with the provisions of Section 13(1)(d) read with section 11(5) shall be charged to tax at the maximum marginal rate of tax. During the year, from the records it is seen that the book value of quoted shares which was Rs.43,75,000/- as on 31.03.2007 was reduced to Rs.21,75,000/- as on 31.03.2008. Consequently, the investment in unquoted ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 4 shares has increased to Rs.1034 Crores in A.Y.2008-09. This implies that the assessee had earned capital gains on sale of quoted shares and invested in unquoted shares which is a prohibited mode of investment as per Section 13(1)(d) of the Act. Therefore, the investment in prohibited mode to the extent of Rs.1034 Crores has escaped from being taxed. The profit on sale of shares of quoted shares was a capital gain on sale of capital assets u/s.11(1A) of the Act. Therefore, the assessee ought to have reflected this capital gain in the computation of income for applying towards the object of the trust. However, the assessee has credited it directly to the year marked fund in the balance sheet and has not reflected it in the income and expenditure statement. For this reason, the capital gains on sale of shares could not have been examined. This is solely on account of the assessee not reflecting the profit on sale of shares in the income statement. Therefore, it can be safely inferred that the assessee has not disclosed fully and truly all the material facts necessary for the assessment Explanation 1 to Section 147 states that mere production of books of accounts from which discrepancy could have been discovered by the Assessing Officer will not amount to full and true disclosure within the meaning of the first proviso to section 147. In this case, by not showing the capital gains in the income statement, the assessee has failed to disclose the income. In view of the non-compliance of the provisions of Section 11(5), exemption u/s.11 should have been denied on the investment of Rs.1034 Crores. Therefore, I have reason to believe that the income to the extent of Rs.1034 Crores has escaped assessment. B) The assessee has claimed exemption u/s.10(34) of Rs.11,98,37,200/- which was not in order. As the assessee has received dividend on the investments from shares / units which is income derived from property/ investment held under trust wholly for charitable for religious purpose. Therefore, the same dividend income should have been offered as income and should be subjected to the norms of application of income (i.e. 85% of unaccumulated income should be taxed in the year). As the dividend income was excluded from the gross income, the same was not included as income dividend from the property held under a trust. Therefore an income of Rs.11,98,37,200/- has escaped income. C) The assessee claimed deduction u/s.11(1)(a) of Rs.6,49,31,667/- (15% of gross income of Rs.43,28,77,779) which was not in order. As the assessee has shown deficit of Rs.4,51,54,962/- after claiming deduction u/s.11(1)(a) of Rs.6,49,31,667/- there would be surplus instead of deficit. Hence, the excess allowance of accumulation of Rs.6,49,31,667/- has been wrongly claimed by the assessee. Therefore an income of Rs.6,49,31,667/- has escaped income for the A.Y.2008-09. In view of the above facts, I have reason to believe that the income to the extent of Rs.1034 Crores + Rs.11,98,37,200 + Rs.6,49,31,667 = Rs. 1052.47 Crores has escaped assessment for A.Y.2008-09. As such the assessment for A.Y.2008- 09 is re-opened by way of issue of notice u/s.148 of the I.T. Act. ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 5 3.1. The reasons recorded by the ld. AO for reopening assessment were furnished by the ld. AO to the assessee on 16/10/2014. The assessee primarily made objection that from the perusal of the aforesaid reasons there could be no fault that could be attributed on the part of the assessee in making a full and true disclosure of the particulars of income by the assessee in the original assessment proceedings and accordingly, first proviso to Section 147 of the Act would come into operation, based on which the re-assessment proceedings initiated by the ld. AO are required to be dropped. The assessee submitted that full and true details were indeed furnished before the ld. AO in the course of original assessment proceedings. It was specifically pointed out by the assessee that with regard to reasons recorded in para- B and para-C above in respect of claim of exemption u/s.10(34) of the Act of Rs.11,98,37,200/- in respect of dividend and claim of deduction us/11(1)(a) of the Act of Rs.6,49,31,667/- (15% of gross income of Rs.43,28,77,779/-), the ld. AO had not brought out any failure on the part of the assessee in making a full and true disclosure of particulars of income during the course of original assessment proceedings. Accordingly, it was pleaded that re- assessment should be dropped in respect of these two issues. 3.2. In re-assessment proceedings, the ld. AO determined the income of the assessee as under:- Rs. Rs. Profit on Sale of Shares (as discussed above) 578,63,38,554 Interest income 43,25,86,354 Dividend from Shares / Units (as discussed above 11,98,37,200 Other Income 2.91,425 633,90,53,533 ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 6 Add: Depreciation (as discussed above) 17.559 TAXABLE INCOME 633,90,71,092 ROUNDED OFF TO 633,90,71,090 3.3. The ld. AO also observed that the exemption u/s.11 of the Act claimed by the assessee is denied in view of violation of provisions of Section 13 of the Act and claim of exemption u/s.10(38) and 10(34) of the Act was also rejected by the ld. AO. 3.4. The ld. CIT(A) gave partial relief to the assessee in respect of certain issues. Aggrieved by this order, both assessee as well as the Revenue are in appeal before us. 3.5. But it would be relevant to address the issue of reopening and its validity thereon as it is purely a legal issue and goes to the root of the matter. 3.6. With regard to claim of exemption u/s.10(34) of the Act of Rs.11,98,37,200/- in respect of dividend on investments in shares / units derived by the assessee trust, we find that up to A.Y.2014-15, the assessee trust is indeed eligible for exemption u/s.10(34) of the Act. In fact, the provisions of Section 11(7) of the Act is inserted in the statute only by Finance No.2 of the Act 2014 w.e.f. 01/04/2015 wherein the assessee trust has been prevented from claiming exemption u/s.10 other than 10(1), 10(23C) and Section 10(46) of the Act. This amendment is obviously applicable only from A.Y.2015-16 onwards and cannot be applicable for earlier years. The year under consideration before us is A.Y.2008-09. Hence, this amendment in Section 11(7) cannot be made ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 7 applicable for A.Y.2008-09. Accordingly, we hold that the claim of exemption made by the assessee in respect of dividend u/s.10(34) of the Act is very much in order. Hence, there cannot be any illegality in the claim of exemption made by the assessee. In either way, the ld. AO in the reasons recorded had not referred to any tangible material for taking a divergent stand in respect of this issue and make addition thereon. It only clearly reflects the change of opinion in the mind of the ld. AO. The law is very well settled that no re-assessment can be made based on change of opinion of the ld. AO. Moreover, we also find that the very same issue was subject matter of adjudication by the Hon’ble Jurisdictional High Court in the case of DIT (Exemptions) Mumbai vs. Jasubhai Foundation reported in 374 ITR 315 (Bom). One of the questions raised before the Hon’ble Jurisdictional High Court was as under:- “(A) Whether, on the facts and in the circumstances of the case and in law, the Hon'ble Tribunal was justified in granting exemption u/s. 10(33} and 10(38) to the tune of Rs. 25.96 lakhs and Rs. 3.21 lakhs respectively, when this income forms a part of the income from property held under trust and therefore can only be claimed to be exempt u/s. 11, if applied for charity and not u/s. 10 the Act ? 3.7. The Hon’ble High Court held as under:- 8. Upon a perusal of the order of the Assessing Officer and that of the Commissioner upholding it, we are of the view that the Tribunal was correct in setting aside these concurrent orders. The language of the two sections is plain and clear. The provisions, namely, sections 10 and 11 fall under a Chapter which is titled "Incomes Which Do Not Form Part of Total Expenditure" (Chapter III). Section 10 deals with incomes not included in total income whereas section 11 deals with income from property held for charitable or religious purposes. We have not found anything in the language of the two provisions nor was Mr. Malhotra able to point out as to how when certain income is not to be included in computing total income of a previous year of any person, then, that which is excluded from section 10 could be included in the total income of the previous year of the person / assessee. That may be a person who receives or derives income from property held under trust wholly for charitable or religious purposes. Thus, the income which is not to be included in computation of the total income is a matter dealt with by section 10 and by section 11 the case of an SRP 10/13 ITXA1310.13.doc assessee who has received income derived from property held under trust only ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 8 for charitable or religious purposes to the extent to which such income is applied to such property in India and that any such income is accumulated or set apart for application for such purposes in India to the extent of which the income so accumulated or set apart in computing 15% of the income of such property, is dealt with. Therefore, it is a particular assessee and who is in receipt of such income as is falling under clause (a) of sub-section (1) of section 11 who would be claiming the exemption or benefit. That is a income derived by a person from property. It is that which is dealt with and if the property is held in trust for the specified purpose, the income derived therefrom is exempt and to the extent indicated in section 11(1)(a) of the Income Tax Act, 1961. There is nothing in the language of sections 10 or 11 which says that what is provided by section 10 or dealt with is not to be taken into consideration or omitted from the purview of section 11. If we accept the argument of Mr. Malhotra and the Revenue, the same would amount to reading into the provisions something which is expressly not there. In such circumstances, the Tribunal was right in its conclusion that the income which in this case SRP 11/13 ITXA1310.13.doc the assessee trust has not included by virtue of section 10, then, that cannot be considered under section 11. 9. In the circumstances and when the income from property held for charitable or religious purpose is not a matter covered or dealt with by section 10 that the Tribunal's view cannot be termed as perverse or vitiated by any error or law apparent on the face of the record. The clear language of these provisions enables us to uphold the order of the Tribunal. It is, accordingly, upheld. The Revenue's appeal does not raise any substantial question of law. 3.8. Moreover, at the time of recording the reasons, the ld. AO indeed had the benefit of the Tribunal order passed in the case of Jasubhai Foundation dated 14/11/2012. Despite this, the ld. AO sought to take a divergent stand in respect of claim of exemption u/s. 10(34) of the Act for the dividend income and sought to reopen the assessment. Since, this issue is squarely covered by the decision of the Hon’ble Jurisdictional High Court on merits also, the reopening made by the ld. AO for the purpose of consideration of the taxability of the dividend income of Rs.11,98,37,200/- is bad in law and is hereby quashed. Hence, we hold that the ld. AO could not have had a reason to believe that income of the assessee had ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 9 escaped assessment in respect of this issue. Hence, reopening made in this regard is quashed. 4. Similarly, with regard to claim of deduction of the assessee trust u/s.11(1)(a) of the Act of Rs.641,31,667/- being 15% of gross income of Rs.43,28,77,779/-, we find from the reasons recorded by the ld. AO that absolutely no finding has been given by the ld. AO as to on what basis and on what tangible material, he had arrived at the conclusion that assessee had claimed excess allowance of accumulation of Rs.6,49,31,667/- u/s.11(1)(a) of the Act. The plain reading of the reasons recorded in this regard clearly proves that there was absolutely no tangible material available with the ld. AO which had live link for formation of belief that the claim of assessee was incorrect. This is a clear case of change of opinion of the ld. AO. We find that out of the gross receipts of Rs.43,28,77,779/- during the year under consideration, assessee trust had duly applied for charitable purposes of Rs.38,77,22,817/- as against the mandated application as per law at 85% of Rs.36,79,46,112/-. This goes to prove that assessee was statutorily entitled to accumulate 15% of gross receipts year after year for future application of funds for charitable purposes. This 15% accumulation of funds works out to Rs.6,49,31,667/- which has been accumulated or set apart for charitable purposes by the assessee. There is absolutely no error in this regard. All these facts were duly reflected in the computation of income enclosed in page 6 of the paper book which was also filed along with the return of income. All these facts were indeed available before the ld. AO in the course of original assessment proceedings itself. Hence, there cannot be any failure in any manner whatsoever for making full and true disclosure of these particulars before the ld. AO in the course of original assessment proceedings. In any case, on this issue in the reasons ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 10 recorded by the ld. AO, we find that the ld. AO had neither placed reliance on any tangible material nor recorded the fact that there is any failure on the part of the assessee in accordance with first proviso to Section 147 of the Act. Hence, it could be safely concluded that the ld. AO had clearly resorted to only change of opinion in this regard. The law is very well settled that no re-assessment could be framed based on change of opinion. Hence, the re-assessment proceedings on this issue is quashed. Capital Gains on Transfer of Capital Asset and Re-investment in Unquoted Shares 5. We find from the reasons recorded by the ld. AO reproduced in para 3 above, the main grievance of the ld. AO seems to be that assessee had not reflected the capital gains in the income and expenditure account and in the computation of income. Instead the assessee had directly credited the sale of investments to the earmarked fund in the balance sheet. Hence, the ld. AO could not have examined the capital gains on sale of shares in the original assessment proceedings. Based on these, the ld. AO in the reasons recorded says that there is a failure on the part of the assessee in making full and true disclosure of facts. Finally, the ld. AO in the reasons recorded observed that re-investment in unquoted shares made by the assessee is in violation of provisions of Section 11(5) of the Act to the tune of Rs.1034 Crores and hence, exemption u/s.11 of the Act should have been denied on the entire value of such re- investment of Rs.1034 Crores. Accordingly, the ld. AO concludes that income to the extent of Rs.1034 Crores had escaped assessment. ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 11 5.1. We find at the outset that assessee had sold 54,99,400 equity shares of Tata Consultancy Services Ltd., having book value of Rs.21,99,760/- and earned long term capital gain of Rs.578,63,38,544/-. The assessee had stated that it was holding the shares of Tata Consultancy Services Ltd., which was received by it as corpus donation. During the year under consideration, the assessee trust had sold these shares and re-invested the amount in preference shares of Tata Sons Ltd. During the year, the assessee had invested an amount of Rs.1034 Crores in 8.25% cumulative redeemable preference shares of Tata Sons Ltd. The source of making these investments were out of sale proceeds of shares of Tata Consultancy Services Ltd. and redemption proceeds of capital gain investment bonds amounting to Rs.455.15 Crores. The assessee pleaded that since the capital gain on sale of shares had been re-invested for acquiring another capital asset, the capital gain arising on transfer shall be deemed to have applied for charitable and religious purposes as per Section 11(1A)(a) of the Act. We find that assessee had indeed submitted the statement of details of change in investments during the year by way of Annexure-3 vide letter dated 21/10/2010 filed before the ld. AO in the original assessment proceedings. The said annexure is reproduced as under:- PARTICULARS AMOUNT Rs. Opening Balance as on 01.04.2007 467,02,25,000.00 Add ; - Investments made during the year a) Fixed Deposits b) Cum. Preference Shares of Tata Sons Ltd. 14,17,00,000.00 1034,00,00,000/00 1048,17,00,000.00 1515,19,25,000.00 Less : - Investments redeemed / matured during the year ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 12 a) Capital Gains Bonds b) Fixed Deposits c) Equity Shares of TCS Ltd. 455,55,00,000.00 15,00,000.00 21,99,760.00 455,91,99,760.00 Closing Balance as on 31.03.2008 1059,27,25,240.00 5.2. From the aforesaid details, the ld. AO was made very much aware about the sale of equity shares of Tata Consultancy Services Ltd., and re- investment of the same in cumulative preference shares of Tata Sons Ltd. The ld. AO had accepted the same during the course of the original assessment proceedings. From the perusal of the reasons recorded by the ld. AO, it is evidently clear that the ld. AO did not have any tangible material either from internal sources or from external sources which would have live link for formation of belief that income of the assessee had escaped assessment, warranting reopening thereon. Admittedly, the assessee had made re-investment in cumulative preference shares of Tata Sons Ltd. The income that could be derived out of such investment would only be dividend income which would be exempt u/s.10(34) of the Act or capital gains on sale of such investment which would be exempt u/s.10(38) of the Act. In any case, the value of investment even if it is to be considered as violation of Section 11(5) of the Act would not result in the value of such investment getting taxed in the hands of the assessee. On the contrary, the only income arising from such investment would become taxable subject to the provisions of the Act. As clearly pointed out by us above, the income if any, arising out of such investment would only be in the form of dividend or capital gains on sale thereon and both these streams of income would be exempt from tax u/s.10(34) or 10(38) of the Act respectively, as the case may be. Hence, there cannot be any income that had escaped assessment within the meaning of Section 147 of the Act. Hence, there cannot be any valid reopening thereon. Infact, the ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 13 Hon’ble Jurisdictional High Court in the case of DIT vs. Sheth Mafatlal Gagalbhai Foundation Trust reported in 249 ITR 533(Bom) had categorically held that any violation of provisions of Section 13 of the Act will at the most lead only to forfeiture of exemption u/s.11 of the Act of the corresponding income arising from such violation and not the entire exemption. The same ratio was subsequently followed by this Mumbai Tribunal in several other cases including JRD Tata Trust vs. ITO in ITA No.3154/Mum/2018; Sir Dorabjee Tata Trust vs. DCIT reported in 122 Taxman.com 274; Sir Ratan Tata Trust vs. DCIT reported in 122 Taxmann.com 275. Hence, it could be safely concluded that the ld. AO could not have legally and validly entertained a belief that income of the assessee had escaped assessment in respect of investment of Rs.1034 Crores made in preference shares of Tata Sons Ltd. Either way, there is absolutely no failure on the part of the assessee to make full and true disclosure of material facts relevant for the purpose of assessment before the ld. AO in the original assessment proceedings. 5.3. Admittedly the assessee had reflected the movement in investments in its balance sheet directly and the said balance sheet has been filed along with return of income. Infact, the balance sheet is a mandatory enclosure along with return of income u/s.139(9) of the Act. Hence, it cannot be said that there is a failure on the part of the assessee to disclose the capital gains on sale of TCS shares and re-investment made in preference shares of Tata Sons Ltd. We find with regard to the issue of capital gains on sale of TCS Ltd shares and re-investment in preference shares of Tata Sons Ltd., the ld. AO did not have any tangible material which enable him to form belief that income of the assessee had escaped assessment. He had categorically stated in the reasons that from the records these transactions were found. That itself goes to prove that ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 14 the ld. AO had gone into the assessment records again and had sought to entertain the change of opinion on the same set of facts available in the records. When the trigger to re-open the assessment was found entirely from the assessment records and the entire basis for reopening the assessment was the disclosure which has been made by the assessee in the course of assessment proceedings and where no material which to a reference was to be found, the Hon’ble Bombay High Court had in the case of 3I Infotech Ltd., vs. ACIT reported in 192 Taxman 137 held in para 12 as under:- “12. The record before the Court, to which a reference has been made earlier, is clearly reflective of the position that during the course of the assessment proceedings the assessee had made a full and true disclosure of all material facts in relation to the assessment. As a matter of fact, it would be necessary to note that the notice to reopen the assessment on the first issue is founded entirely on the assessment records. There is no new material to which a reference is to be found and the entire basis for reopening the assessment is the disclosure which has been made by the assessee in the course of the assessment proceedings. In Cartini India Lid. Addl. CIT [2009] 314 ITR 275 (Bom.l. a Division Bench of this Court has observed that where on consideration of material on record, one view is conclusively taken by the Assessing Officer, it would not be open to the Assessing Officer to reopen the assessment based on the very same material with a view to take another view. The principal which has been enunciated in Carlini India Ltd. '$ case (supra) must apply to the facts of a case such as the present. The assessee had during the course of the assessment proceedings made a complete disclosure of material facts. The Assessing Officer had called for a disclosure on which a specific disclosure on the issue in question was made. In such a case, it cannot be postulated that the condition precedent to the re-opening of an assessment beyond a period of four years has been fulfilled.” 5.4. Hence, the reopening of assessment in respect of capital gain on sale of TCS Ltd. shares and re-investment in preference shares of Tata Sons Ltd., is declared as bad in law. 6. In view of the aforesaid observations, the issues for which reasons were recorded for reopening the assessment completely fails and hence, no re-assessment could have been validly framed by the ld. AO ITA No.1317/Mum/2018 & 1299/Mum/2018 M/s. Navjbai Ratan Tata Trust 15 consequently. Hence, the entire re-assessment proceedings framed are hereby quashed and declared void ab initio and hence, quashed. 7. Since the entire re-assessment proceedings are quashed as void ab initio, the other grounds raised by the assessee as well as the Revenue on merits of the additions need not be adjudicated as they would be academic in nature. All these issues are left open and no opinion is given by us. 8. In the result, appeal of the assessee is allowed and appeal of the Revenue is dismissed. Order pronounced on 24/01/2022 by way of proper mentioning in the notice board. Sd/- (PAVAN KUMAR GADALE) Sd/- (M.BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER7 Mumbai; Dated 24/01/2022 KARUNA, sr.ps Copy of the Order forwarded to : BY ORDER, (Asstt. Registrar) ITAT, Mumbai 1. The Appellant 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy//