Addl. CIT, New Delhi V. M/s. IRCON International Ltd., New Delhi

ITA 3768/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 7539 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 09-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Depreciation; Rectification of order; Search and seizure; Question of law; Tangible material; Difference of opinion; Accommodation entries; Assessment record; Reason to believe; Change of opinion; Reassessment proceedings; Capital Gains
• Section: 143(3); 40(b); 142(1); 234B; 40(a)(ia); 10B; 143(1); 195; 251; 80IC; 64; 80IC; 43; 48; 13; 153; 119; 22; 147; 68; 148; 263; 144; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: C NEW DELHI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER [THROUGH VIDEO CONFERENCING] ITA NO.3768/DEL./2017 ASSESSMENT YEAR: 2009-10 ADDL.CIT, SPECIAL RANGE-4, NEW DELHI VS. IRCON INTERNATIONAL LTD., C-4, DISTRICT CENTRE, SAKET, NEW DELHI PAN :AAACI0684H (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT, AM: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST ORDE R DATED 10/02/2017 PASSED BY THE LEARNED COMMISSIONER OF IN COME-TAX (APPEALS)-39, NEW DELHI [IN SHORT THE LD. CIT(A)] FOR ASSESSMENT YEAR 2009-10 RAISING FOLLOWING GROUNDS: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN HOLDING THE REOPENING OF THE ASSESSMENT BY ISSUING NOTICE U/S 148 OF THE ACT AS V OID AB INITIO. 2. THE APPELLANT CRAVES LEAVE, TO ADD, ALTER OR AME ND ANY GROUND OF APPEAL RAISED ABOVE AT THE TIME OF HEARIN G. APPELLANT BY SHRI GURMEL SINGH, SR. DR RESPONDENT BY DR. RAKESH GUPTA, ADV. DATE OF HEARING 06.01.2021 DATE OF PRONOUNCEMENT 22.01.2021 2 ITA NO.3768/DEL/2017 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSE SSEE IS A GOVERNMENT COMPANY ENGAGED IN EXECUTION OF TURNKEY PROJECTS IN INDIA AND ABROAD RELATING TO RAILWAY AND HIGHWAY CO NSTRUCTION ETC. THE SCRUTINY ASSESSMENT FOR THE YEAR UNDER CON SIDERATION UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (I N SHORT THE ACT) WAS COMPLETED ON 30/12/2011 AT TOTAL INCOME O F 168,77,00,674/-AGAINST THE RETURNED INCOME OF 7,84,81,841 /-. SUBSEQUENT TO THE ASSESSMENT, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE COMPANY HAD TRANSLATED THE ACCRUED INT EREST ON DEFERRED IRAQI DUES AND PROVISION FOR INTEREST TO SUBCONTRACTORS AT EXCHANGE RATE ON LAST SETTLEMENT DATE FROM GOVER NMENT OF INDIA AND NOT AT THE RATE PREVALENT AS ON 31/03/200 9 ( I.E. LAST DATE OF THE RELEVANT FINANCIAL YEAR). ACCORDING TO THE ASSESSING OFFICER, NON-OBSERVATION OF THE MANDATORY PROVISION OF TRANSLATING THE FOREIGN-EXCHANGE TRANSACTION ON THE LAST DATE O F THE FINANCIAL YEAR, THE PROFIT DECLARED BY THE ASSESSEE WAS LOWER BY AN AMOUNT OF 6,90,40,000/- AND, THEREFORE, THE SAID INCOME WAS ESCAPED ASSESSMENT. THE ASSESSING OFFICER, ACCORDINGLY, REC ORDED REASONS TO BELIEVE THAT INCOME ESCAPED ASSESSMENT AND ISSUE D NOTICE UNDER SECTION 148 OF THE ACT ON 24/03/2014. IN THE REASSESSMENT PROCEEDINGS COMPLETED ON 20/02/2015, THE ASSESSING OFFICER AFTER RESTATING THE INTEREST LIABILITY KEEPING IN V IEW THE DOLLAR EXCHANGE RATE ON THE LAST DATE OF THE BALANCE-SHEET FOR THE YEAR UNDER CONSIDERATION, MADE ADDITION OF 6,90,40,000/-. 2.1 BEFORE THE LD. CIT(A), THE ASSESSEE CHALLENGED LEG ALITY OF REASSESSMENT PROCEEDING AS WELL AS ADDITION ON MERI T. THE LD. CIT(A) QUASHED THE REASSESSMENT PROCEEDING ON THE G ROUND THAT 3 ITA NO.3768/DEL/2017 THERE WAS NO TANGIBLE MATERIAL BEFORE THE ASSESSING OFFICER TO FORM REASONS TO BELIEVE AND IT WAS BASED MERELY ON THE CHANGE OF THE OPINION ON SAME SET OF RECORD. THE RELEVANT FI NDING OF THE LD. CIT(A) IS REPRODUCED AS UNDER: 5.5 IT IS ALSO OBSERVED FROM THE SUBMISSIONS OF THE APPELLANT THAT ITS OBJECTION TO THE REOPENING STOOD ON THE SAME GR OUND WHETHER AT THE ASSESSMENT STAGE OR AT THE APPELLATE STAGE. THE AR OF THE APPELLANT HAS HARPED ON ONLY ONE THING - THE TANGIB LE EXTERNAL MATERIAL WHICH LED TO THE REASON FOR THE BELIEF THA T INCOME HAS ESCAPED ASSESSMENT IN VIEW OF THE FACT THAT THE MA TERIAL ON THE BASIS OF WHICH THE ASSESSMENT WAS REOPENED WAS NOT ONLY AVAILABLE IN THE RECORDS AT THE TIME OF THE ORIGINAL ASSESSME NT BUT ALSO WAS ESSENTIALLY A PART OF THE NOTES TO ACCOUNTS FORMING PART OF THE RETURN OF INCOME. FURTHER, IT WAS EMPHASIZED DURING THE AP PEAL HEARING THAT THE POINT REGARDING THE NONRESTATEMENT OF INTE REST ON DEFERRED IRAQI DUES AS ON THE BALANCE SHEET DATE AS ON 31/03 /2009 WAS ALREADY ARGUED AT THE TIME OF THE ORIGINAL ASSESSME NT BY MENTIONING, INTER ALIA, ORIGINAL ASSESSMENT IN THI S CASE WAS MADE U/S 143(3) AFTER CONSIDERING THE RELEVANT MATERIAL HAVING BEARING ON THE ISSUE AT HAND EXPLAINING AS TO WHY THE OUTSTAND ING LIABILITIES CANNOT BE RESTATED ON THE BALANCE SHEET DATE OF THI S YEAR OR OF EARLIER YEARS SINCE PAYMENT HAS NOT BEEN FORTHCOMIN G SINCE LAST TWO DECADES. WHILE THE DECISION OF THE HONBLE GUJARAT HIGH COUR T IN THE CASES MENTIONED ABOVE RESTS ON THE PLANK THAT UP TO FOUR YEARS AN ASSESSMENT IS OPEN TO THE AOS UNRESERVED CONSIDERA TION ON HIS FORMATION OF THE REQUISITE BELIEF WHOSE FORMATION I S NOT A JUDICIAL DECISION BUT AN ADMINISTRATIVE DECISION, YET IN THA T CASE THE AO WHILE MAKING AN ORDER OF PROTECTIVE ASSESSMENT IN R ESPECT OF AY 1993-94 FOUND THAT THERE WAS A TRANSFER IN FAVOUR O F THE PARTNERSHIP FIRM BY THE ASSESSEE OF HIS TRADE STOCK-IN-TRADE ON 19/09/1990, THE CAPITAL ACCOUNT OF THE ASSESSEE IN THE FIRM WAS CRE DITED BY RS.14 LAKHS AND THOUGH THE STOCK-IN-TRADE WAS SOLD TO THA T FIRM ON THAT DAY, IT REMAINED TO BE TAXED IN THE CASE OF THAT AS SESSEE IN THAT AY 1991-92. EVEN IN THE CASE OF BAWA ABHAI SINGH, THE HONBLE DELHI HIGH COURT (JURISDICTIONAL HIGH COURT) IT HAS BEEN OBSERVED, INTER ALIA, ...WHAT IS REALLY NECESSARY TO BE ADJUDICATED IN A CASE OF THIS NATURE IS ABOUT EXISTENCE OF RELEVANT MATERIAL WHIC H FORM FOUNDATION OF A BELIEF AND CONSTITUTES REASONS FOR ENTERTAININ G A BELIEF ABOUT ESCAPEMENT OF AN INCOME.... FURTHER, IT IS HELD LE GALLY THAT AN ASSESSING OFFICER DOES NOT HAVE POWER TO REVIEW AN ASSESSMENT. HENCE, MERELY GIVING REASON THAT PERUSAL OF RECORDS OR A PAST ASSESSMENT HAS FORMED THE REASON FOR THE BELIEF THA T INCOME HAS 4 ITA NO.3768/DEL/2017 ESCAPED ASSESSMENT DOES NOT PER SE MAKE THE REOPENI NG OF AN ASSESSMENT STAND IN THE COURT OF LAW. IN FACT, IN M ADHUKAR KHOSLA VS. CIT (2014) 367ITR 165 (DEL), RELIED ON BY THE A PPELLANT, IT HAS BEEN OBSERVED, INTER ALIA, THE FOUNDATION OF THE A OS JURISDICTION AND THE RAISON DETRE OF A REASSESSMENT NOTICE ARE THE REASONS TO BELIEVE. NOW THIS SHOULD HAVE A RELATION OR A LINK WITH AN OBJECTIVE FACT, IN THE FORM OF INFORMATION OR FACTS EXTERNAL TO THE MATERIALS ON THE RECORD. SUCH EXTERNAL FACTS OR MATERIALS CONSTI TUTE THE DRIVER, OR THE KEY WHICH ENABLES THE AUTHORITY TO LEGITIMATELY REOPEN THE COMPLETED ASSESSMENT. IN ABSENCE OF THIS OBJECTIVE TRIGGER, THE AO DOES NOT POSSESS JURISDICTION TO REOPEN THE ASSESSM ENT. IT IS AT THE NEXT STAGE THAT THE QUESTION, WHETHER THE REOPENING OF ASSESSMENT AMOUNTS TO REVIEW OR CHANGE OF OPINION ARISES. IN OTHER WORDS, IF THERE IS NO REASONS TO BELIEVE BASED ON NEW, TAN GIBLE MATERIALS, THEN THE REOPENING AMOUNTS TO AN IMPERMISSIBLE REVI EW.... 5.6 IT IS ALSO OBSERVED FROM THE APPELLANTS SUBMIS SIONS, BOTH AT THE ASSESSMENT STAGE AND AT THE APPELLATE STAGE MENTION ED EARLIER, THAT IT HAD PLACED RELIANCE ON THE DECISION OF THE JURIS DICTIONAL HIGH COURT (DELHI HC) THAT HAS BEEN RATIFIED BY THE HONBLE SU PREME COURT WITH REGARD TO THE REOPENING AND THE MANNER IN WHICH THE FOUNDATION FOR THE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT. IN CIT VS KELVINATOR OF INDIA LTD (2002) 256 ITR 1 (DEL) IT W AS OBSERVED THAT AN ORDER THAT HAS BEEN PURPORTEDLY PASSED WITHOUT A PPLICATION OF MIND COULD NOT ITSELF CONFER JURISDICTION UPON THE AO TO REOPEN THE PROCEEDING WITHOUT ANYTHING FURTHER AS THAT WOULD AMOUNT TO GIVING A PREMIUM TO AN AUTHORITY EXERCISING QUASI- JUDICIAL FUNCTION TO TAKE BENEFIT OF ITS OWN WRONG. FURTHER, UPHOLDI NG THIS DECISION OF THE DELHI HIGH COURT, THE HONBLE SUPREME COURT IN CIT VS. KELVINATOR OF INDIA LTD (2010) 320 ITR 561 (SC) OBS ERVED THAT THE POWER TO REOPEN ASSESSMENTS W E F 1/04/1989 WAS MUC H WIDER AND ALSO OBSERVED, INTER ALIA, HOWEVER, ONE NEEDS TO GIVE A SCHEMATIC INTERPRETATION TO THE WORDS REASON TO BE LIEVE FAILING WHICH, WE ARE AFRAID, SECTION 147 WOULD GIVE ARBITR ARY POWERS TO THE ASSESSING OFFICER TO REOPEN ASSESSMENTS ON THE BASI S OF MERE CHANGE OF OPINION, WHICH CANNOT BE PER SE REASON T O REOPEN. WE MUST ALSO KEEP IN MIND THE CONCEPTUAL DIFFERENCE BE TWEEN POWER TO REVIEW AND POWER TO RE-ASSESS. THE ASSESSING OFFICE R HAS NO POWER TO REVIEW; HE HAS THE POWER TO REASSESS. BUT RE-ASS ESSMENT HAS TO BE BASED ON FULFILLMENT OF CERTAIN PRE-CONDITION AN D IF THE CONCEPT OF CHANGE OF OPINION' IS REMOVED, AS CONTENDED ON BEH ALF OF THE DEPARTMENT, THEN, IN THE GARB OF REOPENING THE ASSE SSMENT, REVIEW WOULD TAKE PLACE. ONE MUST TREAT THE CONCEPT OF CH ANGE OF OPINION AS AN IN-BUILT TEST TO CHECK ABUSE OF POWER BY THE ASSESSING OFFICER. HENCE, AFTER 1S* APRIL, 1989, ASSESSING OFFICER HAS POWER TO REOPEN, PROVIDED THERE IS TANGIBLE MATERIAL TO COME TO TH E CONCLUSION THAT THERE IS ESCAPEMENT OF INCOME FROM ASSESSMENT. REAS ONS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. 5 ITA NO.3768/DEL/2017 5.7 FROM THE ABOVE PARAS, IT IS OBSERVED THAT THE A RGUMENTS AND SUBMISSIONS GIVEN BY THE AR OF THE APPELLANT APPEAR PLAUSIBLE AS THEY ARE BORNE OUT FROM RECORDS AND IN ACCORDANCE W ITH THE EXISTING LAW IN THIS REGARD. FURTHER, THE ISSUE REGARDING NO N-RESTATEMENT OF INTEREST IN FOREIGN CURRENCY AND NOT INCLUDING IT I N ITS INCOME EXIGIBLE TO INCOME TAX IS BY THE APPELLANT WAS ALREADY CONSI DERED AND ACCEPTED IN THE ORIGINAL ASSESSMENT U/S 143(3). ALS O, THE ABSENCE OF TANGIBLE MATERIAL WHICH FORMED THE BASIS OF THE BEL IEF - THE QUESTION AS TO HOW DID THE AO COME TO PERUSE THE ASSESSMENT RECORDS WHEN THE ASSESSMENT WAS ALREADY COMPLETED NECESSARILY, I N MY OPINION, CONSTITUTES A REVIEW WHICH, AN AO IS NOT PERMITTE D TO DO UNDER THE ACT. ACCORDINGLY, IN DUE DEFERENCE TO THE DECISIONS OF THE APEX COURT AND THE JURISDICTIONAL HIGH COURT MENTIONED SUPRA, THE REOPENING OF THE ORIGINAL ASSESSMENT U/S 143(3) BY RESORTING TO SECTION 147 OF THE ACT BASED ON THE REASONS MENTIONED ABOVE IS, IN MY OPINION, VOID AB INITIO AND ACCORDINGLY, THE REJECTION OF THE APPELL ANTS OBJECTION TO THE REOPENING OF THE ORIGINAL ASSESSMENT U/S 143(3) AS WELL AS THE SUBSEQUENT ORDER OF REASSESSMENT U/S 143(3) R W 147 OF THE ACT ARE CANCELLED (ALBEIT WITHOUT GOING INTO THE MERITS OF THE ADDITION OF THE INCOME ESCAPING ASSESSMENT. 2.2 AGGRIEVED WITH THE FINDING OF THE LD. CIT(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE GROUNDS A S REPRODUCED ABOVE . 3. BEFORE US, LD. DR SUBMITTED THAT ASSESSMENT HAS BEEN REOPENED WITHIN FOUR YEARS FROM THE LAST DATE OF T HE ASSESSMENT YEAR AND, THEREFORE, THE PROVISO TO SECTION 147 OF THE ACT IS NOT APPLICABLE, WHERE IT IS MENTIONED THAT BEYOND FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR EXCEPT FAILURE ON THE PART OF THE ASSESSEE IN DISCLOSING FULLY AND TRULY ALL MATE RIAL FACTS, NO ASSESSMENT CAN BE REOPENED. HE SUBMITTED THAT IN TH E ORIGINAL ASSESSMENT NO VIEW OR OPINION WAS FORMED ON THE ISS UE OF RESTATING OF THE INTEREST LIABILITY BY THE ASSESSIN G OFFICER, AND THEREFORE, THE QUESTION OF CHANGE OF OPINION DOES NOT ARISE. THE LD. DR ALSO RELIED ON THE DECISION OF THE HONBLE D ELHI HIGH COURT IN THE CASE OF BAWA ABHAI SINGH VS DCIT (2001), 25 3 ITR 83 (DEL) AND DECISION OF HONBLE GUJRAT HIGH COURT IN THE CASE OF 6 ITA NO.3768/DEL/2017 PRAFUL CHUNNILAL PATEL VS M. J. MAKWANA CIT, (1999) 236 ITR 832 (GUJ). 4. THE LD. COUNSEL OF THE ASSESSEE FILED A PAPER-BOOK ELECTRONICALLY CONTAINING PAGES 1 TO 211. HE SUBMIT TED THAT DISCLOSURE OF THE FACTS RELATING TO IRAQI DUES WAS MADE IN NOTE NO.14 OF SCHEDULE R OF BALANCE-SHEET OF THE ASSES SEE COMPANY AND THIS NOTE WAS APPEARING IN ASSESSEES ACCOUNTS FOR MORE THAN LAST 10 YEARS. HE SUBMITTED THAT DURING THIS PERIOD SEVERAL SCRUTINY ASSESSMENTS HAVE BEEN DONE AND NO OBJECTIO N HAD BEEN RAISED IN ANY OF THOSE YEARS. ACCORDING TO HIM, TAK ING DIFFERENT VIEW OF THE MATTER IN THE INSTANT YEAR AMOUNTS TO C HANGE OF OPINION. HE RELIED ON THE ORDER OF THE LD. CIT(A) T O SUPPORT HIS ARGUMENTS. HE FURTHER SUBMITTED: (I) THAT IN VIEW OF THE FOLLOWING DECISIONS, IN ABSENCE OF ANY FRESH TANGIBLE MATERIAL, THE ASSESSING OFFICER IS EXCLUDED FROM REOPENING THE ASSESSMENT EVEN WITHIN FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR MERELY ON THE CHANGE OF THE OPINION ON THE SAME S ET OF RECORDS AVAILABLE BEFORE HIM: - PCIT VS CENTURY TEXTILES & INDUSTRIES LTD (2018) 259 TAXMAN 360 (SC) - JALARAM ENTERPRISES P LTD VS ITO (2019) 262 TAXMAN 404 (BOM) - TULSI DEVELOPERS VS DCIT (2013) 353 ITR 530 (GUJ) - HK BUIKSCON LTD VS ITO (2011) 339 ITR 535 (GUJ) 7 ITA NO.3768/DEL/2017 - ACIT VS NITYANAND INFRASTRUCTRE LTD. ( ITA NO. 2255/MUM/2017 ) - ACIT VS MS SEEMA DILIP VORA ( ITA NO. 582/MUM/2017 - REPLIKA PRESS PRIVATE LIMITED & ANR VS DCIT (2013) 92 DTR 153 (DEL) - MADHUKAR KHOSLA VS ACIT(2014) 367 ITR 165 (DEL) - PCIT VS TUPPERWARE INDIA PRIVATE LIMITED (2016) 284 CTR 68(DEL) - TURNER BROADCASTING SYSTEMS ASIA PACIFIC INC. VS DCIT (2016) 380 ITR 412 (DEL) - RASALIKA TRADING AND INVESTEMNT CO. PVT LTD VS DCIT ( 2014) 365 ITR 447(DEL) (II) THAT THE ASSESSING OFFICER HAS NOT APPLIED HI S MIND WHILE ADOPTING RATE OF US DOLLAR FOR COMPUTING INTE REST LIABILITY AND THEREFORE, REASONS NEED TO BE REJECTE D ON THE GROUND OF NON-APPLICATION OF MIND ALSO. (III) THAT NO ADDITION HAS BEEN MADE ON THIS ACCOUN T IN SUBSEQUENT YEARS AND NO CASE OF PRIOR YEAR HAS EITH ER BEEN REOPENED ON THIS ACCOUNT ALSO. 5. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON T HE ISSUE IN DISPUTE AND PERUSED THE RELEVANT MATERIAL ON REC ORDS. IN THE CASE, THE ASSESSMENT COMPLETED U/S 143(3) OF THE A CT IN 2009- 10, AND SUBSEQUENTLY, THE ASSESSMENT HAS BEEN REOPE NED ON 24/03/2014, THEREFORE, THE ASSESSMENT HAS BEEN REOP ENED WITHIN 8 ITA NO.3768/DEL/2017 FOUR YEARS FROM THE END OF RELEVANT ASSESSMENT YEAR . IN CASE OF REOPENING OF ASSESSMENT COMPLETED U/S 143(3) OF THE ACT, BEYOND FOUR YEARS, THE ACT HAS PROVIDED THAT EXCEPT FAILUR E ON THE PART OF THE ASSESSEE TO DISCLOSE ALL MATERIAL FACTS FULLY AND TRULY NECESSARY FOR ASSESSMENT, REOPENING IS NOT PERMIT TED. THE RELEVANT PROVISO BELOW SECTION 147 OF THE ACT IS RE PRODUCED AS UNDER: INCOME ESCAPING ASSESSMENT. 147. .. : PROVIDED THAT WHERE AN ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 143 OR THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO ACTION SHALL BE TAKEN UNDER THI S SECTION AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVA NT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAP ED ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REASON OF TH E FAILURE ON THE PART OF THE ASSESSEE TO MAKE A RETURN UNDER SEC TION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION (1) O F SECTION 142 OR SECTION 148 OR TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT, FOR THAT ASSESSMENT Y EAR: 5.1 IN THE CASE BEFORE US, THE ASSESSMENT WHICH WAS COM PLETED UNDER SECTION 143(3) OF THE ACT, HAS BEEN REOPENED WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THEREFORE, ISSUE IN DISPUTE BEFORE US IS THAT IN WHAT CIRCUMST ANCES ASSESSMENT CAN BE REOPENED WITHIN THE PERIOD OF FOU R YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THIS ISSU E HAS BEEN DISCUSSED AND ADJUDICATED BY HONBLE HIGH COURTS A ND SUPREME COURT IN VARIOUS DECISIONS, WHICH HAVE BEEN CITED B Y PARTIES BEFORE US. 5.2 IN THE CASE OF BAWA ABHAI SINGH VS CIT (SUPRA) RELIED UPON BY THE LEARNED DR, THE ISSUE INVOLVED THE ISSUE INV OLVED WAS 9 ITA NO.3768/DEL/2017 WHETHER THE REPORT OF THE VALUATION OFFICER CONSTIT UTE INFORMATION ON THE BASIS OF WHICH ASSESSMENT CAN BE REOPENED. T HE HONBLE HIGH COURT IN THEIR DECISION DATED 23/03/2001 ANALY ZED THE PROVISIONS OF SECTION 147 OF THE ACT PRIOR TO 31/03 /1989 AND PROVISIONS THEREAFTER AND HELD THAT AFTER THE AMENDMENT TO SECTION 147 OF THE ACT, AN ASSESSMENT CAN BE REOPENED U/S 14 7 WITHIN THE PERIOD OF FOUR YEARS FROM THE END OF RELEVANT ASSES SMENT YEAR, EVEN IF THERE IS A FULL AND TRUE DISCLOSURE OF ALL MATER IAL FACTS IN THE ORIGINAL ASSESSMENT THE RELEVANT FINDING OF THE HONBLE HIGH COURT IS REPRODUCED AS UNDER: 7. THE CRUCIAL EXPRESSION IS 'REASON TO BELIEVE'. THE EXPRESSION PREDICATES THAT AO MUST HOLD A BELIEF.......BY THE EXISTENCE OF REASONS FOR HOLDING SUCH A BELIEF. IN OTHER WORDS, IT CONTEMPLATES EXISTENCE OF REASONS ON WHICH BELIEF IS FOUNDED AND NOT MERELY A BELIEF IN THE EXISTENCE OF REASONS INDUCING THE BEL IEF. SUCH A BELIEF MAY NOT BE BASED MERELY ON REASONS BUT IT MUST BE F OUNDED ON INFORMATION. AS WAS OBSERVED IN GANGA SARAN & SONS (P) LTD. VS. ITO (1981) 22 CTR (SC) 112 : (1981) 130 ITR 1 (SC) : TC 51R.639, EXPRESSION 'REASONS TO BELIEVE' IS STRONGER THAN TH E EXPRESSION 'IS SATISFIED'. BELIEF ENTERTAINED BY THE AO SHOULD NOT BE IRRATIONAL AND ARBITRARY. TO PUT IT DIFFERENTLY, IT MUST BE RE ASONABLE AND MUST BE BASED ON REASONS WHICH ARE MATERIAL. IN S. NARAYANAPPA VS. CIT (1967) 63 ITR 219 (SC) : TC 51R.651 IT WAS NOTED BY THE APEX COURT THAT EXPRESSION 'REASONS TO BELIEVE' IN S. 147 DOES NOT MEAN PURELY A SUBJECTIVE SATISFACTION ON THE PART O F THE AO, BELIEF MUST BE HELD IN GOOD FAITH; IT CANNOT BE MERELY A P RETENCE. IT IS OPEN TO THE COURT TO EXAMINE WHETHER REASONS FOR TH E BELIEF HAVE A RATIONAL NEXUS OR A RELEVANT BEARING TO THE FORMA TION OF BELIEF AND ARE NOT EXTRANEOUS OR IRRELEVANT FOR THE PURPOS E OF THE SECTION. TO THAT LIMITED EXTENT, ACTION OF THE AO IN INITIAT ING PROCEEDINGS UNDER S. 147 CAN BE CHALLENGED IN A COURT OF LAW. A S WAS OBSERVED BY THIS COURT IN R. DALMIA VS. UNION OF IN DIA (1972) 84 ITR 616 (DEL) : TC 51R.385 THAT THERE SHOULD BE FAC TS BEFORE THE AO THAT REASONABLY GIVE RISE TO A BELIEF, AS NOTED ABOVE, BUT THEN IT MAY NOT BE CONCLUSIVE TO SUPPORT THE TENTATIVE C ONCLUSION. A MERE FANCIFUL BELIEF THAT INCOME HAS ESCAPED ASSESS MENT WHICH IS NOT BASED ON LAW WILL NOT JUSTIFY ACTION UNDER S. 1 47. IT HAS BEEN OBSERVED BY THE APEX COURT IN SEVERAL CASES THAT BE LIEF OF THE AO IS AS TO ESCAPEMENT OF INCOME AND BELIEF SHOULD NOT BE A PRODUCT OF IMAGINATION OR SPECULATION. THERE MUST BE REASON TO INDUCE 10 ITA NO.3768/DEL/2017 BELIEF. THE SAME SHOULD BE BY REASON OF OMISSION OR FAILURE ON THE PART OF ASSESSEE TO DISCLOSE FULLY AND TRULY HIS IN COME. THE POSITION HAS CHANGED AFTER 1ST APRIL, 1989. UPTO 31ST MARCH, 1989, TWO CONDITIONS WERE REQUIRED TO BE FULFILLED TO CONFER JURISDICTION ON THE AO TO ACT U NDER S. 147(B). THEY WERE (1) HE MUST HAVE INFORMATION WHICH COMES INTO HIS POSSESSION SUBSEQUENT TO THE MAKING OF THE ORIGINAL ASSESSMENT ORDER, AND (2) THAT INFORMATION MUST LEAD TO HIS BE LIEF THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT, OR THAT I T HAS BEEN UNDERASSESSED OR ASSESSED AT TOO LOW A RATE OR HAS BEEN MADE THE SUBJECT OF EXCESSIVE RELIEF. AFTER 1ST APRIL, 1989, THE POSITION IS SOMEWHAT DIF FERENT. SEC. 147 W.E.F. 1ST APRIL, 1989, PROVIDES THAT WHERE AO HAS REASONS TO BELIEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAP ED ASSESSMENT FOR ANY ASSESSMENT YEAR HE MAY APPLY THE PROVISIONS OF SS. 148 TO 153. HE MAY ASSESS OR REASSESS THE IN COME WHICH HAS ESCAPED ASSESSMENT. IT IS TO BE NOTED THAT S. 1 47 AS IT STANDS W.E.F. 1ST APRIL, 1989, NOT ONLY MERGES CLS. (A) AN D (B) OF THE PRE- AMENDED S. 147 BUT ALSO BRINGS ABOUT A SIGNIFICANT CHANGE IN THE PRELIMINARY REQUIREMENT OF CERTAIN CONDITIONS MANDA TORY IN CHARACTER BEFORE REASSESSMENT PROCEEDINGS SHOULD BE INITIATED IN THE PRE-AMENDED SECTION. CONDITIONS PRECEDENT FOR I NITIATION OF ACTION UNDER S. 147(A) OR 147(B) OF THE PRE-AMENDED SITUATION, IS HIGHLIGHTED ABOVE. THE AMENDMENT PROVISIONS ARE CON TEXTUALLY DIFFERENT AND THE CUMULATIVE CONDITIONS SPELT OUT I N CL. (A) OR (B) OF S. 147 PRIOR TO ITS AMENDMENT, ARE NOT PRESENT IN T HE AMENDED PROVISION. THE ONLY CONDITION FOR ACTION IS THAT AO SHOULD HAVE REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMEN T, WHICH BELIEF CAN BE REACHED IN ANY MANNER AND IS NOT QUAL IFIED BY A PRECONDITION OF FAITH AND TRUE DISCLOSURE OF MATERI AL FACT BY AN ASSESSEE AS CONTEMPLATED IN THE PRE-AMENDED S. 147( A) OF THE ACT AND AO CAN UNDER THE AMENDED PROVISIONS LEGITIMATEL Y REOPEN THE ASSESSMENT IN RESPECT OF AN INCOME WHICH HAS ESCAPE D ASSESSMENT. VIEWED IN THAT ANGLE POWER TO REOPEN AS SESSMENT IS MUCH WIDER UNDER THE AMENDED PROVISION AND CAN BE E XERCISED EVEN AFTER ASSESSEE HAS DISCLOSED FULLY AND TRULY A LL THE MATERIAL FACTS. TO SIMILAR VIEW WERE THE CONCLUSIONS OF THIS COURT IN RAKESH AGGARWAL VS. ASSTT. CIT (1997) 142 CTR (DEL) 272 : (1997) 225 ITR 496 (DEL) : TC S51.4080. IT IS TO BE NOTED AT THIS JUNCTURE THAT TWIN CONDITIONS MUST BE FULFILLED IF THE CASE IS ONE WHI CH IS COVERED BY THE PROVISO TO S. 147 OPERATIVE W.E.F. 1ST APRIL, 1 989. 5.3 THE HONBLE HIGH COURT OF GUJARAT IN THE CASE OF PRAFUL CHUNNILAL VS MJ MAKWANA CIT (SUPRA) HAS IN THEIR DECISION DATED 19/02/1998 EXPRESSED THAT THOUGH THE MATERIAL WAS 11 ITA NO.3768/DEL/2017 AVAILABLE ON RECORD AT THE TIME OF ASSESSMENT, WHEN NO CONSCIOUS CONSIDERATION OF THE MATERIAL IS MADE, IT WILL NOT PUT AN EMBARGO UNDER THE PROVISION OF 147 OF THE ACT, AS PRIMA FACI E, THERE COULD NOT BE CHANGE OF OPINION IN SUCH SCENARIO. THE RELEVANT FINDING OF THE HONBLE COURT IS REPRODUCED AS UNDER: 6. THERE IS NO DISPUTE ABOUT THE FACT THAT THE IMPUGN ED NOTICE UNDER S. 148 OF THE ACT, HAS BEEN ISSUED WITHIN FOU R YEARS FROM THE END OF THE RELEVANT ASST. YR. 1991-92. UNDER S. 147 OF THE SAID ACT, WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, THE AO, WHERE HE HAS REASON TO BELIEVE THAT A NY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY AS SESSMENT YEAR, MAY ASSESS OR REASSESS SUCH INCOME. HOWEVER, AFTER FOUR YEARS, THE PROVISO WOULD BE ATTRACTED AND NO ACTION CAN BE TAKEN UNDER THIS SECTION UNLESS SUCH INCOME HAS ESCAPED A SSESSMENT BY REASON OF FAILURE ON THE PART OF THE ASSESSEE TO MAKE RETURN UNDER S. 139 OR IN RESPONSE TO A NOTICE UNDER S. 14 2(1) OR S. 148 OF THE SAID ACT, TO DISCLOSE FULLY AND TRULY ALL MATER IAL FACTS FOR HIS ASSESSMENT FOR THAT ASSESSMENT YEAR. THEREFORE, IT IS ONLY WHEN THE CASE FALLS UNDER THE PROVISO THAT THE QUESTION OF NON-DISCLOSURE OF MATERIAL FACTS WOULD BECOME RELEVANT. IN SUCH CA SES, IF THE ASSESSEE HAS MADE FULL DISCLOSURE ON RECORD, THEN E VEN IF SUCH INCOME HAS ESCAPED ASSESSMENT, NO ACTION CAN BE INI TIATED BY THE AO UNDER THIS SECTION. WHERE, HOWEVER, THE SAID PER IOD OF FOUR YEARS HAS NOT EXPIRED, THE CONDUCT OF THE ASSESSEE REGARDING DISCLOSURE OF MATERIAL FACTS NEED NOT BE THE BASIS FOR INITIATING THE PROCEEDINGS AND THEY CAN BE COMMENCED IF THE AO HAS REASON TO BELIEVE THAT THE INCOME HAS ESCAPED ASSESSMENT NOTW ITHSTANDING THAT THERE WAS FULL DISCLOSURE OF MATERIAL FACTS ON RECORD. THE ASSESSEE IN SUCH CASES CANNOT DEFEND THE INITIATION OF ACTION ON THE GROUND THAT THE FACTS WERE ALREADY PLACED ON RE CORD AND THAT THE AO MUST HAVE OR OUGHT TO HAVE CONSIDERED THEM. EXPLN. 1 TO S. 147 OF THE SAID ACT HAS A BEARING ON DISCLOSURE ASP ECT AND IT APPLIES TO THE PROVISO TO THE EXTENT IT ALLOWS INIT IATION OF THE PROCEEDINGS UNDER S. 147 ON ACCOUNT OF NON-DISCLOSU RE OF MATERIAL FACTS BY THE ASSESSEE. EXPLN. 2 APPLIES TO THE ENTIRE SECTION AND IT ENUME RATES DEEMED CASES WHERE INCOME HAS ESCAPED ASSESSMENT. CLAUSE ( A) THEREOF COVERS THE CASE WHERE NO RETURN IS FILED THOUGH THE INCOME HAD EXCEEDED THE MAXIMUM AMOUNT WHICH IS NOT CHARGEABLE TO INCOME-TAX. IN SUCH CASES, IN ORDER TO PUT IT BEYON D THE PALE OF DOUBT OR CONTROVERSY, THE PROVISION IS MADE THAT TH EY WILL BE DEEMED TO BE CASES OF ESCAPED ASSESSMENT SO AS TO W ARRANT THE 12 ITA NO.3768/DEL/2017 PROCEEDINGS EVEN BEYOND THE SAID PERIOD OF FOUR YEA RS, SINCE, IN THAT EVENT, THE CASE WOULD FALL IN THE ENABLING PAR T OF THE PROVISO. CLAUSE (B) DEALS WITH CASES WHERE NO ASSESSMENT IS MADE AND THE AO NOTICES THAT THE INCOME IS UNDERSTATED OR EX CESSIVE LOSS, DEDUCTION ALLOWANCE OR RELIEF IS CLAIMED IN THE RET URN. THESE WOULD BE CASES WHERE THE RETURN IS ACCEPTED WITHOUT SCRUTINY AND NO FORMAL ASSESSMENT IS MADE. CLAUSE (C) WOULD COVE R CASES WHERE, IN THE ASSESSMENT ALREADY MADE, INCOME WAS UNDERASSESSED OR ASSESSED TOO LOW OR EXCESSIVE RELI EF IS GIVEN OR THAT EXCESSIVE LOSS OR DEPRECIATION ALLOWANCE OR OT HER ALLOWANCE UNDER THE ACT HAS BEEN COMPUTED. IN THE AFORESAID D EEMED CASES OF ESCAPEMENT OF INCOME, THE AO CAN INITIATE THE PR OCEEDINGS ON FINDING OR DISCOVERING SUCH CASES AND NO DEBATE WHE THER THEY CONSTITUTE CASES OF ESCAPEMENT OF INCOME, WOULD BE PERMISSIBLE. 7. IT WILL THUS, BE SEEN THAT IN THE PROCEEDINGS TAKE N UNDER S. 147, THE AO MAY MAKE AN ASSESSMENT OR REASSESSMENT OR RECOMPUTATION, AS THE CASE MAY BE. THE WORD ASSESS REFERS TO A SITUATION WHERE THE ASSESSMENT WAS NOT MADE IN THE NORMAL MANNER WHILE THE WORD REASSESS REFERS TO A SITUAT ION WHERE AN ASSESSMENT IS ALREADY MADE, BUT IT IS SOUGHT TO BE REASSESSED ON THE BASIS OF THIS PROVISION. IN CASES WHERE THE AO HAS NOT MADE AN ASSESSMENT OF ANY ITEM OF INCOME CHARGEABLE TO TAX WHILE PASSING THE ASSES SMENT ORDER IN THE RELEVANT ASSESSMENT YEAR, IT CANNOT BE SAID THAT SUCH INCOME WAS SUBJECTED TO AN ASSESSMENT. IN THE ASSES SMENT PROCEEDINGS, THE AO WOULD ASCERTAIN ON CONSIDERATIO N OF ALL RELEVANT CIRCUMSTANCES THE AMOUNT OF TAX CHARGEABLE TO A GIVEN TAXPAYER. THE WORD ASSESSMENT WOULD MEAN THE ASCE RTAINMENT OF THE AMOUNT OF TAXABLE INCOME AND OF THE TAX PAYA BLE THEREON. IN OTHER WORDS, WHERE THERE IS NO ASCERTAINING OF T HE AMOUNT OF TAXABLE INCOME AND THE TAX PAYABLE THEREON, IT CAN NEVER BE SAID THAT SUCH INCOME WAS ASSESSED. MERELY BECAUSE DURIN G THE ASSESSMENT PROCEEDINGS THE RELEVANT MATERIAL WAS ON RECORD OR COULD HAVE BEEN WITH DUE DILIGENCE DISCERNED BY THE AO FOR THE PURPOSE OF ASSESSING A PARTICULAR ITEM OF INCOME CH ARGEABLE TO TAX, IT CANNOT BE INFERRED THAT THE AO MUST NECESSA RILY HAVE DELIBERATED OVER IT AND TAKEN IT OUT WHILE ASCERTAI NING THE TAXABLE INCOME OR THAT HE HAD FORMED ANY OPINION IN RESPECT THEREOF. IF LOOKING BACK IT APPEARS TO THE AO, (ALBEIT WITHIN F OUR YEARS OF THE END OF THE RELEVANT ASSESSMENT YEAR) THAT A PARTICU LAR ITEM EVEN THOUGH REFLECTED ON THE RECORD WAS NOT SUBJECTED TO ASSESSMENT AND WAS LEFT OUT WHILE WORKING OUT THE TAXABLE INCO ME AND THE TAX PAYABLE THEREON, I.E., WHILE MAKING THE FINAL ASSES SMENT ORDER, THAT WOULD ENABLE HIM TO INITIATE THE PROCEEDINGS I RRESPECTIVE OF THE QUESTION OF NON-DISCLOSURE OF MATERIAL FACTS BY THE ASSESSEE. IN FACT, IF THERE IS MATERIAL PLACED ON RECORD WHIC H WOULD SHOW 13 ITA NO.3768/DEL/2017 EXISTENCE OF INCOME CHARGEABLE TO TAX AND WHICH ORD INARILY OUGHT TO HAVE BEEN INCLUDED IN THE ASCERTAINMENT OF TAXAB LE INCOME MADE IN THE ASSESSMENT ORDER BUT WAS NOT SO INCLUDE D, THAT WOULD ITSELF PROVIDE A CAUSE OR JUSTIFICATION FOR A BELIEF TO THE AO THAT SUCH INCOME HAD ESCAPED ASSESSMENT AND THE AO IN SUCH CASES WOULD BE EX FACIE JUSTIFIED IN INITIATING THE PROCEEDINGS ON SUCH BASIS. THE CASES OF NON-ASSESSMENT OF AN ITEM OF INCOME CHARGEABLE TO TAX WOULD WARRANT FORMATION OF REQUIS ITE BELIEF TO INITIATE THE PROCEEDINGS WITHIN FOUR YEARS OF THE E ND OF THE RELEVANT ASSESSMENT YEAR, EVEN WHERE FULL DISCLOSUR E WERE MADE AND YET AN INCOME CHARGEABLE TO TAX HAD ESCAPED FRO M BEING INCLUDED IN THE FINAL ASSESSMENT ORDER IN WHICH TAX ABLE INCOME WAS WORKED OUT. IN SUCH CASES THE AO HAS IN FACT A DUTY TO EXERCISE HIS JURISDICTION. THE AO HAS NOT TO CONCLU SIVELY COME TO ANY FINDING ON THE FACTS WHICH PROMPTED HIS REASON TO BELIEVE, AT THE STAGE OF THE ISSUANCE OF NOTICE UNDER S. 148 PU RSUANT TO WHICH THE ASSESSEE IS TO BE HEARD; AND THE ORDER IF ADVER SE, CAN BE QUESTIONED UNDER THE PROVISIONS OF THE ACT. 8. THE CASES OF UNDERASSESSMENT OR EXCESSIVE RELIEF W HICH ARE DEEMED CASES OF ESCAPEMENT OF INCOME LEAVE NO SCOPE FOR AN ARGUMENT THAT THEY ARE NOT THE CASES OF INCOME HAVI NG ESCAPED ASSESSMENT. IF THE AO PRIMA FACIE FINDS OR DISCOVER S THAT THE CASE FALLS IN ANY OF THE CLAUSES OF EXPLN. 2, THEN THOSE CASES WILL BE OF DEEMED CASES OF INCOME THAT HAS ESCAPED ASSESSMENT AND WITHOUT ANYTHING MORE BEYOND SUCH FIND OR DISCOVERY , HE CAN INITIATE THE PROCEEDINGS UNDER S. 147 OF THE ACT. O N A PROPER INTERPRETATION OF S. 147 OF THE ACT, IT WOULD APPEA R THAT THE POWER TO MAKE ASSESSMENT OR REASSESSMENT WITHIN FOUR YEAR S OF THE END OF THE RELEVANT ASSESSMENT YEAR WOULD BE ATTRACTED EVEN IN CASES WHERE THERE HAS BEEN A COMPLETE DISCLOSURE OF ALL R ELEVANT FACTS UPON WHICH A CORRECT ASSESSMENT MIGHT HAVE BEEN BAS ED IN THE FIRST INSTANCE, AND WHETHER IT IS AN ERROR OF FACT OR LAW THAT HAS BEEN DISCOVERED OR FOUND OUT JUSTIFYING THE BELIEF REQUIRED TO INITIATE THE PROCEEDINGS. IN OUR VIEW, THE WORDS 'E SCAPED ASSESSMENT' WHERE THE RETURN IS FILED, ARE APT TO C OVER THE CASE OF A DISCOVERY OF A MISTAKE IN THE ASSESSMENT CAUSED B Y EITHER AN ERRONEOUS CONSTRUCTION OF THE TRANSACTION OR DUE TO ITS NON- CONSIDERATION, OR, CAUSED BY A MISTAKE OF LAW APPLI CABLE TO SUCH TRANSFER OR TRANSACTION EVEN WHERE THERE HAS BEEN A COMPLETE DISCLOSURE OF ALL RELEVANT FACTS UPON WHICH A CORRE CT ASSESSMENT COULD HAVE BEEN BASED. 9. AS NOTED ABOVE, THE PROVISION OF S. 147 REQUIRES T HAT THE AO SHOULD HAVE REASON TO BELIEVE THAT ANY INCOME CHARG EABLE TO TAX HAS ESCAPED ASSESSMENT. THE WORD 'REASON' IN THE PH RASE REASON TO BELIEVE WOULD MEAN CAUSE OR JUSTIFICATI ON. IF THE AO HAS A CAUSE OR JUSTIFICATION TO THINK OR SUPPOSE TH AT INCOME HAD 14 ITA NO.3768/DEL/2017 ESCAPED ASSESSMENT, HE CAN BE SAID TO HAVE A REASON TO BELIEVE THAT SUCH INCOME HAD ESCAPED ASSESSMENT. THE WORDS 'REASON TO BELIEVE', CANNOT MEAN THAT THE AO SHOULD HAVE FINAL LY ASCERTAINED THE FACTS BY LEGAL EVIDENCE. THEY ONLY MEAN THAT HE FORMS A BELIEF FROM THE EXAMINATION HE MAKES AND IF HE LIKES FROM ANY INFORMATION THAT HE RECEIVES. IF HE DISCOVERS OR FI NDS OR SATISFIES HIMSELF THAT THE TAXABLE INCOME HAS ESCAPED ASSESSM ENT, IT WOULD AMOUNT TO SAYING THAT HE HAD REASON TO BELIEVE THAT SUCH INCOME HAD ESCAPED ASSESSMENT. THE JUSTIFICATION OF HIS BE LIEF IS NOT TO BE JUDGED FROM THE STANDARDS OF PROOF REQUIRED FOR COM ING TO A FINAL DECISION. A BELIEF THOUGH JUSTIFIED FOR THE PURPOSE OF INITIATION OF THE PROCEEDINGS UNDER S. 147, MAY ULTIMATELY STAND ALTERED AFTER THE HEARING AND WHILE REACHING THE FINAL CONCLUSION ON THE BASIS OF THE INTERVENING ENQUIRY. AT THE STAGE WHERE HE FIND S A CAUSE OR JUSTIFICATION TO BELIEVE THAT SUCH INCOME HAS ESCAP ED ASSESSMENT, THE AO IS NOT REQUIRED TO BASE HIS BELIEF ON ANY FI NAL ADJUDICATION OF THE MATTER. IN THE PRESENT CASE, FROM THE FIRST ASSESSMENT IT APPEARED TO THE AO, WHILE MAKING AN ORDER IN RESPEC T OF THE ASST. YR. 1993-94, THAT THE AMOUNT OF TAXABLE INCOME IN T HE FORM OF CAPITAL GAINS IN RESPECT OF THE TRANSFER OF THE LAN D WHICH WAS TREATED AS STOCK-IN-TRADE ON 19TH SEPT., 1990, IN F AVOUR OF THE FIRM AND THE TAX PAYABLE THEREON NOT BEING ASCERTAINED, THERE WAS ESCAPEMENT OF INCOME. SINCE THE AO AT THE FIRST ASS ESSMENT IN THE YEAR 1991-92 NEVER REALLY FORMED AN OPINION ON THE QUESTION WHETHER THERE WAS A TRANSFER ON 19TH SEPT., 1990, O F THE LAND IN QUESTION TO THE FIRM AND THAT THE AMOUNTS CREDITED TO THE ACCOUNTS OF THE PARTNERS WHO HAD CONTRIBUTED THE LANDS TO TH E FIRM, WERE MEANT TO BE THE PRICE OF THE LAND WHICH WAS TO BE A CTUALLY PAID FROM THE COLLECTIONS RECEIVED BY THE FIRM FROM MEMB ERSHIP FEES AS SOON AS RECEIVED, AS WAS ENVISAGED ADMITTEDLY IN PA RA. 11 OF THE PARTNERSHIP DEED, THERE WAS NO QUESTION OF ANY CHAN GE OF OPINION WHEN ON THE RELEVANT FACTS BEING FOUND THE AO, WHIL E PROTECTIVELY ASSESSING THE PETITIONER-ASSESSEE FOR THE YEAR 1993 -94, NOTED THAT THIS WAS A CASE FOR ISSUANCE OF A NOTICE UNDER S. 1 48, WHICH CAME TO BE ISSUED THEREAFTER. WHEN THE AMOUNT OF TAXABLE INCOME AND OF THE TAX PAYABLE THEREON WERE NOT ASCERTAINED AT ALL BY THE AO IN RESPECT OF THE TRANSFER MADE BY THE ASSESSEE IN FAVOUR OF THE FIRM ON 19TH SEPT., 1990, THERE OBVIOUSLY WAS NO OP INION FORMED IN THAT REGARD AND CONSEQUENTLY, THERE WOULD NOT AR ISE ANY QUESTION OF A MERE CHANGE OF OPINION. IN CASES WHER E THE AO HAD OVERLOOKED SOMETHING AT THE FIRST ASSESSMENT, THERE CAN, IN OUR OPINION, BE NO QUESTION OF ANY CHANGE OF OPINION WH EN THE INCOME WHICH WAS CHARGEABLE TO TAX IS ACTUALLY TAXED AS IT OUGHT TO HAVE BEEN UNDER THE LAW BUT WAS NOT, DUE TO AN ERROR COM MITTED AT THE FIRST ASSESSMENT. 15 ITA NO.3768/DEL/2017 5.4 THE FULL BENCH OF HONBLE DELHI HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX VS KELVINATOR OF INDIA L TD., 256 ITR 1 (DEL)(FB) IN THEIR DECISION DATED 19/04/2002 DID NOT SUBSCRIBE TO THE FINDING IN THE CASE OF BAWA ABHAY SINGH (SUPRA) AND PRAFUL CHUNILAL PATEL (SUPRA) AND HELD THAT THE AO DOES NOT HAVE ANY JURISDICTION TO REVIEW ITS OWN ORDER AND I NITIATE REASSESSMENT PROCEEDING UPON MERE CHANGE OF OPINION BASED ON THE MATERIAL WHICH WAS ALREADY AVAILABLE BEFORE THE ASSESSING OFFICER. THE RELEVANT FINDING OF THE HONBLE HIGH COURT IS REPRODUCED AS UNDER 15. IT IS A WELL SETTLED PRINCIPLE OF LAW THAT WHAT CA NNOT BE DONE DIRECTLY CANNOT BE DONE INDIRECTLY. IF THE ITO DOES NOT POSSESS THE POWER OF REVIEW, HE CANNOT BE PERMITTED TO ACHIEVE THE SAID OBJECT BY TAKING RECOURSE TO INITIATING A PROCEEDING OF RE ASSESSMENT OR BY WAY OF RECTIFICATION OF MISTAKE. IN A CASE OF TH IS NATURE THE REVENUE IS NOT WITHOUT REMEDY. SEC. 263 OF THE ACT EMPOWERS THE CIT TO REVIEW AN ORDER WHICH IS PREJUDICIAL TO THE REVENUE. 16. IN BAWA ABHAI SINGHS CASE (SUPRA) A DIVISION BENC H OF THIS COURT OF WHICH ONE OF US (D.K. JAIN, J.) IS A MEMBE R, CLEARLY HELD : 'THE CRUCIAL EXPRESSION IS 'REASON TO BELIEVE'. THE EXPRESSION PREDICATES THAT THE AO MUST HOLD A BELIEF.......BY THE EXISTENCE OF REASONS FOR HOLDING SUCH A BELIEF. IN OTHER WORDS, IT CONTEMPLATES EXISTENCE OF REASON ON WHICH BELIEF IS FOUNDED AND NOT MERELY A BELIEF IN THE EXISTENCE OF REASONS INDUCING THE BEL IEF. SUCH A BELIEF MAY NOT BE BASED MERELY ON REASONS BUT IT MUST BE F OUNDED ON INFORMATION. AS WAS OBSERVED IN GANGA SARAN & SONS (P) LTD. VS. ITO (1981) 22 CTR (SC) 112 : (1981) 130 ITR 1 (SC) : TC 51R.639, THE EXPRESSION 'REASON TO BELIEVE' IS STRONGER THAN THE EXPRESSION 'IS SATISFIED'. THE BELIEF ENTERTAINED BY THE AO SH OULD NOT BE IRRATIONAL AND ARBITRARY. TO PUT IT DIFFERENTLY, IT MUST BE REASONABLE AND MUST BE BASED ON REASONS WHICH ARE MATERIAL. IN S. NARAYANAPPA VS. CIT (1967) 63 ITR 219 (SC) : TC 51R .651, IT WAS NOTED BY THE APEX COURT THAT THE EXPRESSION 'REASON TO BELIEVE' IN S. 147 DOES NOT MEAN PURELY A SUBJECTIVE SATISFACTI ON ON THE PART OF THE AO, THE BELIEF MUST BE HELD IN GOOD FAITH; I T CANNOT BE MERELY A PRETENCE. IT IS OPEN TO THE COURT TO EXAMI NE WHETHER THE REASONS FOR THE BELIEF HAVE A RATIONAL NEXUS OR A R ELEVANT BEARING TO THE FORMATION OF THE BELIEF AND ARE NOT EXTRANEO US OR IRRELEVANT 16 ITA NO.3768/DEL/2017 FOR THE PURPOSE OF THE SECTION. TO THAT LI MITED EXTENT, THE ACTION OF THE AO IN INITIATING PROCEEDINGS UNDER S. 147 CAN B E CHALLENGED IN A COURT OF LAW.' IT WAS FURTHER OBSERVED : 'UPTO 31ST MARCH, 1989, TWO CONDITIONS WERE REQUIRE D TO BE FULFILLED TO CONFER JURISDICTION ON THE AO TO ACT U NDER S. 147(B). THEY ARE : (1) HE MUST HAVE INFORMATION WHICH COMES INTO HIS POSSESSION SUBSEQUENT TO THE MAKING OF THE ORIGINAL ASSESSMENT ORDER, AND (2) THAT INFORMATION MUST LEAD TO HIS BE LIEF THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT, OR THAT I T HAS BEEN UNDER-ASSESSED OR ASSESSED AT TOO LOW A RATE OR HAS BEEN MADE THE SUBJECT OF EXCESSIVE RELIEF. AFTER 1ST APRIL, 1989, THE POSITION IS SOMEWHAT DIF FERENT. SEC. 147 W.E.F. 1ST APRIL, 1989, PROVIDES THAT WHERE AO HAS REASONS TO BELIEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAP ED ASSESSMENT FOR ANY ASSESSMENT YEAR HE MAY APPLY THE PROVISIONS OF S. 148 TO 153. HE MAY ASSESS OR REASSESS THE INC OME WHICH HAS ESCAPED ASSESSMENT. IT IS TO BE NOTED THAT S. 1 47 AS IT STANDS W.E.F. 1ST APRIL, 1989, NOT ONLY MERGES CLS. (A) AN D (B) OF THE PRE- AMENDED S. 147 BUT ALSO BRINGS ABOUT A SIGNIFICANT CHANGE IN THE PRELIMINARY REQUIREMENT OF CERTAIN CONDITIONS MANDA TORY IN CHARACTER BEFORE REASSESSMENT PROCEEDINGS SHOULD BE INITIATED IN THE PRE-AMENDED SECTION. THE CONDITIONS PRECEDENT F OR INITIATION OF ACTION UNDER S. 147(A) OR 147(B) OF THE PRE-AMENDED SITUATION, IS HIGHLIGHTED ABOVE. THE AMENDMENT PROVISIONS ARE CON TEXTUALLY DIFFERENT AND THE CUMULATIVE CONDITIONS SPELT OUT I N CL. (A) OR (B) OF S. 147 PRIOR TO ITS AMENDMENT, ARE NOT PRESENT IN T HE AMENDED PROVISION. THE ONLY CONDITION FOR ACTION IS THAT TH E AO SHOULD HAVE REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMEN T, WHICH BELIEF CAN BE REACHED IN ANY MANNER AND IS NOT QUAL IFIED BY A PRECONDITION OF FAITH AND TRUE DISCLOSURE OF MATERI AL FACT BY AN ASSESSEE AS CONTEMPLATED IN THE PRE-AMENDED S. 147( A) OF THE ACT AND AO CAN UNDER THE AMENDED PROVISIONS LEGITIMATEL Y REOPEN THE ASSESSMENT IN RESPECT OF AN INCOME WHICH HAS ESCAPE D ASSESSMENT. VIEWED IN THAT ANGLE POWER TO REOPEN AS SESSMENT IS MUCH WIDER UNDER THE AMENDED PROVISION AND CAN BE E XERCISED EVEN AFTER ASSESSEE HAS DISCLOSED FULLY AND TRULY A LL THE MATERIAL FACTS. TO SIMILAR VIEW WERE THE CONCLUSIONS OF THIS COURT IN RAKESH AGGARWAL VS. ASSTT. CIT (1997) 142 CTR (DEL) 272 : (1997) 225 ITR 496 (DEL) : TC S51.4080, IT IS TO BE NOTED AT THIS JUNCTURE THAT THE TWIN CONDITIONS MUST BE FULFILLED IF THE CASE IS ON E WHICH IS COVERED BY THE PROVISO TO S. 147 OPERATIVE W.E.F. 1 ST APRIL, 1989.' [EMPHASIS, ITALICISED IN PRINT, SUPPLIED BY US]. 17 ITA NO.3768/DEL/2017 IT IS EVIDENT FROM THE AFORE - EXTRACTED POSITION OF THE DECISION THAT IT IS NOT AN AUTHORITY FOR THE PROPOSITION THAT A MERE CHANGE IN THE OPINION WOULD ALSO CONFER JURISDICTION UPON THE AO TO INITIATE A PROCEEDING UNDER S. 147 OF THE ACT AS WAS CONTENDED BY MR. JOLLY. 17. A DECISION AS IS WELL KNOWN, IS AN AUTHORITY FOR T HE PROPOSITION THAT IT DECIDES AND NOT WHAT CAN LOGICA LLY BE DEDUCED THEREFROM. A POINT NOT RAISED NOR ARGUED AT THE BAR CANNOT BE SAID TO BE THE RATIO OF THE DECISION. 18. ANOTHER ASPECT OF THE MATTER CANNOT BE ALSO LOST S IGHT OF. THE BOARD HAS POWER TO ISSUE CIRCULARS UNDER S. 119 OF THE SAID ACT. IT IS TRITE THAT THE CIRCULARS WHICH ARE ISSUED BY THE CBDT ARE LEGALLY BINDING ON THE REVENUE [SEE UCO BANK VS. CIT (1999) 154 CTR (SC) 88 : (1999) 237 ITR 889 (SC)]. RECENTLY IN CIT VS. ANJUM M.H. GHASWALA & ORS. (2001) 171 CTR (SC) 1 : JT 2001 (9) SC 61, THE APEX COURT FOLLOWING THE SAID DECISION OBSERVED : 'IT IS TRUE THAT BY THIS PRESS RELEASE THE BOARD HA D INTERPRETED THE PROVISIONS OF THE ACT IN A PARTICULAR MANNER. BE TH AT AS IT MAY, WE WOULD LIKE TO MAKE IT CLEAR THAT EVERY CLARIFICATOR Y NOTE OR PRESS RELEASE ISSUED BY THE BOARD DOES NOT HAVE THE STATU TORY FORCE LIKE THE CIRCULARS ISSUED BY THE BOARD UNDER S. 119 OF T HE ACT. IT IS ONLY THOSE CIRCULARS ISSUED BY THE BOARD UNDER THE PROVISIONS OF S. 119 OF THE ACT, WILL HAVE THE STATUTORY FORCE AND W ILL BE BINDING ON EVERY IT AUTHORITIES. THEREFORE, THE PRESS RELEASE RELIED UPON BY SHRI RAMAMURTI NOT BEING A CIRCULAR ISSUED UNDER S. 119 OF THE ACT WILL NOT BE OF ANY ASSISTANCE TO THE RESPONDENTS IN SUPPORT OF THEIR CONTENTIONS.' IF FURTHER OBSERVED THAT : 'LEARNED SOLICITOR GENERAL HAS POINTED OUT THAT BY VIRTUE OF THE POWER VESTED IN THE BOARD UNDER S. 119(2)(A) OF THE ACT, THE BOARD HAS ISSUED CIRCULARS BY NOTIFICATION NO. F. NO. 400 /234/95-IT(B), DT. 23RD MAY, 1996. AS PER THIS CIRCULAR, IT HAS EM POWERED THAT THE CHIEF CIT AND DIRECTOR GENERAL OF INCOME-TAX MA Y WAIVE OR REDUCE INTEREST CHARGED UNDER SS. 234A, 234B AND 23 4C OF THE ACT IN THE CLASS OF CASES OR CLASS OF INCOMES SPECI FIED IN PARA. 2 OF THE SAID ORDER FOR THE PERIOD AND ON CONDITIONS WHI CH ARE ENUMERATED THEREIN. HE SUBMITTED THAT IN VIEW OF TH E SAID CIRCULAR, THE SAME AUTHORITY CAN BE EXERCISED BY TH E COMMISSION SINCE THE SAID CIRCULAR WOULD AMOUNT TO RELAXATION OF THE RIGOR OF SS. 234A, 234B AND 234C OF THE ACT. WE ARE IN UNISO N WITH THIS SUBMISSION OF THE LEARNED SOLICITOR GENERAL. THIS C OURT IN A CATENA OF CASES HAS HELD THAT THE CIRCULARS OF THE CBDT AR E LEGALLY BINDING ON THE REVENUE. [SEE UCO BANK VS. CIT (SUPR A). SINCE THESE CIRCULARS ARE BENEFICIAL TO THE ASSESSEES, SU CH BENEFIT CAN 18 ITA NO.3768/DEL/2017 BE CONFERRED ALSO ON THE ASSESSEES WHO HAVE APPROAC HED THE SETTLEMENT COMMISSION UNDER S. 245C OF THE ACT ON S UCH TERMS AND CONDITIONS AS CONTAINED IN THE CIRCULAR. IN OUR OPINION, IT IS FOR THIS PURPOSE THAT S. 245F OF THE ACT HAS EMPOWERED THE SETTLEMENT COMMISSION TO EXERCISE THE POWER OF AN I T AUTHORITY UNDER THE ACT. WE MUST CLARIFY HERE THAT WHILE EXER CISING THE POWER DERIVED UNDER THE CIRCULARS OF THE BOARD, THE COMMISSION DOES NOT ACT AS A SUBORDINATE TO THE BOARD BUT WILL BE ENFORCING THE RELAXED PROVISIONS OF THE CIRCULARS FOR THE BEN EFIT OF THE ASSESSEE IN THE PROCESS OF SETTLEMENT.' 19. THE BOARD IN EXERCISE OF ITS JURISDICTION UNDER TH E AFORE- MENTIONED PROVISIONS HAD ISSUED THE CIRCULAR ON 31S T OCT., 1989. THE SAID CIRCULAR ADMITTEDLY IS BINDING ON THE REVE NUE. THE AUTHORITY, THEREFORE, COULD NOT HAVE TAKEN A VIEW, WHICH WOULD RUN COUNTER TO THE MANDATE OF THE SAID CIRCULAR. CL AUSE 7.2 AS REFERRED TO HEREINBEFORE IS IMPORTANT. FROM A PERUSAL OF CL. 7.2 OF THE SAID CIRCULAR IT W OULD APPEAR THAT IN NO UNCERTAIN TERMS IT WAS STATED AS TO UNDER WHA T CIRCUMSTANCES THE AMENDMENTS HAD BEEN CARRIED OUT I .E., ONLY WITH A VIEW TO ALLAY THE FEARS THAT THE OMISSION OF THE EXPRESSION 'REASON TO BELIEVE' FROM S. 147 WOULD GIVE ARBITRAR Y POWERS TO THE AO TO REOPEN PAST ASSESSMENT ON MERE CHANGE OF OPIN ION. IT IS, THEREFORE, EVIDENT THAT EVEN ACCORDING TO TH E CBDT A MERE CHANGE OF OPINION CANNOT FORM THE BASIS FOR REOPENI NG A COMPLETED ASSESSMENT. 20. THE SUBMISSION OF MR. JOLLY TO THE EFFECT THAT THE SAID CIRCULAR CANNOT BE CONSTRUED IN SUCH A MANNER WHEREBY THE JU RISDICTION OF THE STATUTORY AUTHORITY WOULD BE TAKEN AWAY IS NOT APPOSITE FOR THE PURPOSE OF THIS CASE. IN UNION OF INDIA & ORS. (SUPRA), WHEREUPON MR. JOLLY HAD PLACED STRONG RELIANCE, THE APEX COURT WAS DEALING WITH AN ADMINISTRATIVE INSTRUCTIONS WHE REBY NO RIGHT WAS CONFERRED UPON THE RESPONDENTS TO HAVE THE HOUS E RENT AMOUNT INCLUDED IN THEIR EMOLUMENTS FOR THE PURPOSE OF COMPUTING OVERTIME ALLOWANCE. THE APEX COURT HELD THAT OTHERW ISE ALSO THE GOVERNMENTS INSTRUCTIONS HAVE TO BE READ IN CONFOR MITY WITH THE PROVISIONS OF THE ACT. THEREIN THE APEX COURT WAS N OT CONCERNED WITH THE STATUTORY POWERS OF A STATUTORY AUTHORITY TO ISSUE BINDING CIRCULARS. 21. ANOTHER ASPECT OF THE MATTER ALSO CANNOT BE LOST S IGHT OF. A STATUTE CONFERRING AN ARBITRARY POWER MAY BE HELD T O BE ULTRA VIRES ART. 14 OF THE CONSTITUTION OF INDIA. IF TWO INTERP RETATIONS ARE POSSIBLE, THE INTERPRETATION WHICH UPHOLDS CONSTITU TIONALITY, IT IS 19 ITA NO.3768/DEL/2017 TRITE, SHOULD BE FAVOURED. IN THE EVENT IT IS HELD THAT BY REASON OF S. 147 IF ITO EXERCISES ITS JURISDICTION FOR INITIATING A PROCEEDING FOR REASSE SSMENT ONLY UPON MERE CHANGE OF OPINION, THE SAME MAY BE HELD TO BE UNCONSTITUTIONAL. WE ARE, THEREFORE, OF THE OPINION THAT S. 147 OF THE ACT DOES NOT POSTULATE CONFERMENT OF POWER UPON THE AO TO INITIATE REASSESSMENT PROCEEDING UPON HIS MERE CHAN GE OF OPINION. WE, HOWEVER, MAY HASTEN TO ADD THAT IF 'REASON TO B ELIEVE' OF THE AO IF FOUNDED ON AN INFORMATION WHICH MIGHT HAVE BE EN RECEIVED BY THE AO AFTER THE COMPLETION OF ASSESSMENT, IT MA Y BE A SOUND FOUNDATION FOR EXERCISING THE POWER UNDER S. 147 R/ W S. 148 OF THE ACT. 22. WE ARE UNABLE TO AGREE WITH THE SUBMISSION OF MR. JOLLY TO THE EFFECT THAT THE IMPUGNED ORDER OF REASSESSMENT CANN OT BE FAULTED AS THE SAME WAS BASED ON INFORMATION DERIVED FROM T HE TAX AUDIT REPORT. THE TAX AUDIT REPORT HAD ALREADY BEEN SUBMI TTED BY THE ASSESSEE. IT IS ONE THING TO SAY THAT THE AO HAD RE CEIVED INFORMATION FROM AN AUDIT REPORT WHICH WAS NOT BEFO RE THE ITO, BUT IT IS ANOTHER THING TO SAY THAT SUCH INFORMATIO N CAN BE DERIVED BY THE MATERIAL WHICH HAD BEEN SUPPLIED BY THE ASSE SSEE HIMSELF. 23. WE ALSO CANNOT ACCEPT SUBMISSION OF MR. JOLLY TO T HE EFFECT THAT ONLY BECAUSE IN THE ASSESSMENT ORDER, DETAILED REASONS HAVE NOT BEEN RECORDED ON ANALYSIS OF THE MATERIALS ON T HE RECORD BY ITSELF MAY JUSTIFY THE AO TO INITIATE A PROCEEDING UNDER S. 147 OF THE ACT. THE SAID SUBMISSION IS FALLACIOUS. AN ORDE R OF ASSESSMENT CAN BE PASSED EITHER IN TERMS OF SUB-S. (1) OF S. 1 43 OR SUB-S. (3) OF S. 143. WHEN A REGULAR ORDER OF ASSESSMENT IS PASSE D IN TERMS OF THE SAID SUB-S. (3) OF S. 143 A PRESUMPTION CAN BE RAISED THAT SUCH AN ORDER HAS BEEN PASSED ON APPLICATION OF MIND. IT IS WELL KNOWN THAT A PRESUMPTION CAN ALSO BE RAISED TO THE EFFECT THAT IN TERMS OF CL. (E) OF S. 114 OF THE INDIAN EVIDENCE ACT THE JU DICIAL AND OFFICIAL ACTS HAVE BEEN REGULARLY PERFORMED. IF IT BE HELD T HAT AN ORDER WHICH HAS BEEN PASSED PURPORTEDLY WITHOUT APPLICATI ON OF MIND WOULD ITSELF CONFER JURISDICTION UPON THE AO TO REO PEN THE PROCEEDING WITHOUT ANYTHING FURTHER, THE SAME WOULD AMOUNT TO GIVING PREMIUM TO AN AUTHORITY EXERCISING QUASI JUD ICIAL FUNCTION TO TAKE BENEFIT OF ITS OWN WRONG. FOR THE REASONS AFORE-MENTIONED WE ARE OF THE OPINI ON THAT ANSWER TO THE QUESTION RAISED BEFORE THIS BENCH MUS T BE RENDERED IN THE AFFIRMATION I.E., IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. NO ORDER AS TO COSTS. 20 ITA NO.3768/DEL/2017 5.5 THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF KELVINATOR OF INDIA LTD. (SUPRA) HAS BEEN APPROVED BY THE HONBLE SUPREME COURT IN CIT VS. KELVINATOR OF INDIA LTD 320 ITR 561(SC) ON 18/01/2010 AND HELD THAT AO HAS POWER TO REOPEN, PROVIDED THERE IS 'TANGIBLE MATERIAL' TO COME TO TH E CONCLUSION THAT THERE IS ESCAPEMENT OF INCOME FROM ASSESSMENT. REASO NS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. THE RELEVANT FINDING OF THE HONBLE SUPREME COURT IS REPRODUCED AS UNDER: 4. ON GOING THROUGH THE CHANGES, QUOTED ABOVE, MADE T O S. 147 OF THE ACT, WE FIND THAT, PRIOR TO DIRECT TAX LAWS (AMENDMENT) ACT, 1987, REOPENING COULD BE DONE UNDER ABOVE TWO CONDI TIONS AND FULFILLMENT OF THE SAID CONDITIONS ALONE CONFERRED JURISDICTION ON THE AO TO MAKE A BACK ASSESSMENT, BUT IN S. 147 OF THE ACT (W.E.F. 1ST APRIL, 1989), THEY ARE GIVEN A GO BY AND ONLY O NE CONDITION HAS REMAINED, VIZ., THAT WHERE THE AO HAS REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT, CONFERS JURISDICTION TO REOPEN THE ASSESSMENT. THEREFORE, POST 1ST APRIL, 1989, PO WER TO REOPEN IS MUCH WIDER. HOWEVER, ONE NEEDS TO GIVE A SCHEMAT IC INTERPRETATION TO THE WORDS 'REASON TO BELIEVE' FAI LING WHICH, WE ARE AFRAID, S. 147 WOULD GIVE ARBITRARY POWERS TO T HE AO TO REOPEN ASSESSMENTS ON THE BASIS OF 'MERE CHANGE OF OPINION ', WHICH CANNOT BE PER SE REASON TO REOPEN. WE MUST ALSO KEE P IN MIND THE CONCEPTUAL DIFFERENCE BETWEEN POWER TO REVIEW AND P OWER TO REASSESS. THE AO HAS NO POWER TO REVIEW; HE HAS THE POWER TO REASSESS. BUT REASSESSMENT HAS TO BE BASED ON FULFI LLMENT OF CERTAIN PRE-CONDITION AND IF THE CONCEPT OF 'CHANGE OF OPINION' IS REMOVED, AS CONTENDED ON BEHALF OF THE DEPARTMENT, THEN, IN THE GARB OF REOPENING THE ASSESSMENT, REVIEW WOULD TAKE PLACE. ONE MUST TREAT THE CONCEPT OF 'CHANGE OF OPINION' AS AN IN-BUILT TEST TO CHECK ABUSE OF POWER BY THE AO. HENCE, AFTER 1ST AP RIL, 1989, AO HAS POWER TO REOPEN, PROVIDED THERE IS 'TANGIBLE MA TERIAL' TO COME TO THE CONCLUSION THAT THERE IS ESCAPEMENT OF INCOM E FROM ASSESSMENT. REASONS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. OUR VIEW GETS SUPPORT FROM THE CHANGES MADE TO S. 147 OF THE ACT, AS QUOTED HEREINABOVE. UNDER THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, PARLIAMENT NOT ONLY DELETED THE WORDS 'REASON TO BELIEVE' BUT ALSO INSERTED THE WORD 'OPI NION' IN S. 147 OF THE ACT. HOWEVER, ON RECEIPT OF REPRESENTATIONS FROM THE COMPANIES AGAINST OMISSION OF THE WORDS 'REASON TO BELIEVE', 21 ITA NO.3768/DEL/2017 PARLIAMENT RE-INTRODUCED THE SAID EXPRESSION AND DE LETED THE WORD 'OPINION' ON THE GROUND THAT IT WOULD VEST ARB ITRARY POWERS IN THE AO. WE QUOTE HEREINBELOW THE RELEVANT PORTIO N OF CIRCULAR NO. 549, DT. 31ST OCT., 1989 [(1990) 82 CTR (ST) 1] , WHICH READS AS FOLLOWS : '7.2 AMENDMENT MADE BY THE AMENDING ACT, 1989, TO R E- INTRODUCE THE EXPRESSION REASON TO BELIEVE IN S. 147.A NUMBER OF REPRESENTATIONS WERE RECEIVED AGAINST THE OMISSION OF THE WORDS REASON TO BELIEVE FROM S. 1 47 AND THEIR SUBSTITUTION BY THE OPINION OF THE AO. IT W AS POINTED OUT THAT THE MEANING OF THE EXPRESSION, REASON TO BELIEVE HAD BEEN EXPLAINED IN A NUMBER OF COURT RULINGS IN THE PAST AND WAS WELL SETTLED AND ITS OMISSION FROM S. 147 W OULD GIVE ARBITRARY POWERS TO THE AO TO REOPEN PAST ASSE SSMENTS ON MERE CHANGE OF OPINION. TO ALLAY THESE FEARS, TH E AMENDING ACT, 1989, HAS AGAIN AMENDED S. 147 TO REINTRODUCE THE EXPRESSION HAS REASON TO BELIEVE IN PLACE OF THE WORDS FOR REASONS TO BE RECORDED BY HIM IN WRITING, IS OF THE OPINION. OTHER PROVISIONS OF THE NEW S. 147, HOWEVER, REMAIN THE SAME.' 5.6 IN THE CASE OF PCIT VS CENTURY TEXTILES INDUSTRIES LTD. (SUPRA) CITED BY THE LD. COUNSEL OF THE ASSESSEE, D URING REGULAR SCRUTINY PROCEEDINGS, THE ASSESSING OFFICER RAISED SPECIFIC QUERIES WITH REGARD TO THE CLAIM OF SECTION 80IC OF THE ACT , WHICH WAS DULY RESPONDED BY THE ASSESSEE AND THE ASSESSMENT W AS COMPLETED AFTER REDUCING THE CLAIM UNDER SECTION 80 IC OF THE ACT. SUBSEQUENTLY, THE ASSESSING OFFICER REOPENED THE AS SESSMENT ON THE GROUND THAT EXCESS DEDUCTION WAS ALLOWED TO THE ASSESSEE DUE TO THE REASON THAT DEDUCTION WAS CLAIMED ON RECEIPT /INCOME, WHICH WERE NOT DERIVED FROM THE BUSINESS OF THE UND ERTAKING. THE HONBLE BOMBAY HIGH COURT IN THE CASE IN THEIR DECISION DATED 03/04/2018 HELD THAT WHERE THE ASSESSING OFFI CER HAS CONSCIOUSLY MADE INQUIRIES ON AN ISSUE IN REGULAR A SSESSMENT PROCEEDING, HE CANNOT REOPEN THE ASSESSMENT ON THE SAME ISSUE. 22 ITA NO.3768/DEL/2017 THE RELEVANT FINDING OF THE OF THE HONBLE HIGH COU RT IS REPRODUCED AS UNDER: 11. THE UNDISPUTED POSITION IN THE PRESENT CASE IS THAT THE REGULAR ASSESSMENT WAS COMPLETED UNDER SECTION 143( 3) OF THE ACT AND THE RE-OPENING HAS BEEN ISSUED WITHIN A PER IOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THUS, THE RIGOUR OF THE FIRST PROVISO TO SECTION 147 OF THE A CT IS NOT TO BE SATISFIED FOR ISSUE OF A REOPENING NOTICE I.E. FAIL URE TO DISCLOSE ALL MATERIAL FACTS TRULY AND FULLY NECESSARY FOR ASSESS MENT. IT IS ALSO NOT DISPUTED THAT IN THE REGULAR ASSESSMENT PROCEED INGS, QUERIES WERE RAISED IN RESPECT OF CLAIM UNDER SECTION 80IC OF THE ACT AND THE SAME WERE RESPONDED TO BY THE RESPONDENT-ASSESS EE RESULTING IN REDUCTION OF CLAIM FOR DEDUCTION UNDER SECTION 80IC OF THE ACT. IN THE ABOVE FACTS, IT IS SELF EVIDENT THA T THE ASSESSING OFFICER WAS CONSCIOUS OF THE CLAIM OF DEDUCTION MAD E BY THE RESPONDENT-ASSESSEE UNDER SECTION 80IC OF THE ACT W HICH LED TO THE ENQUIRY. IT IS FOR THE ASSESSING OFFICER TO DEC IDE THE EXTENT AND NATURE OF ENQUIRY IN RESPECT OF CLAIM UNDER SECTION 80IC OF THE ACT. THEREFORE, WHEN THE ASSESSING OFFICER HAS TAKEN A C ONSCIOUS DECISION OF MAKING ENQUIRY UNDER SECTION 80IC OF TH E ACT THEN IT IS NOT OPEN TO HIM TO TURN AROUND AND CLAIM THAT CERTA IN ASPECTS OF THE CLAIM UNDER SECTION 80IC OF THE ACT WERE NOT CO NSIDERED BY HIM. IT IS UNDISPUTED AS POINTED OUT ABOVE, SECTION 80IC OF THE ACT WAS A SUBJECT MATTER OF ENQUIRY AND THIS RESULTED I N DISALLOWANCE OF RS. 11.49 CRORES OUT OF THE CLAIM FOR RS. 33.67 CRORES MADE BY THE RESPONDENT UNDER SECTION 80IC OF THE ACT. THE D ECISION OF THIS COURT IN EXPORT CREDIT GUARANTEE CORPN. OF INDIA LT D. (SUPRA), IN OUR VIEW, WOULD HAVE NO APPLICATION TO THE PRESENT FACTS AS IN THAT CASE ADMITTEDLY DURING THE REGULAR ASSESSMENT PROCE EDINGS, THE ASSESSING OFFICER HAS NOT APPLIED HIS MIND TO THE I SSUE SOUGHT TO BE RAISED IN THE RE-OPENING PROCEEDINGS. IN THE AFO RESAID DECISION, IT WAS HELD THAT THE ASSESSING OFFICER HAS IGNORED RELEVANT MATERIAL IN ARRIVING AT AN ASSESSMENT CONTRARY TO L AW. IT WAS ALSO FOUND AS A FACT IN THE ABOVE CASE OF EXPORT CREDIT GUARANTEE CORPN. OF INDIA LTD. (SUPRA) THAT NO QUERY WAS RAIS ED DURING THE COURSE OF THE REGULAR ASSESSMENT PROCEEDINGS. THUS, THE OCCASION FOR THE ASSESSING OFFICER TO APPLY HIS MIND TO THE CLAIM BY THE RESPONDENT- ASSESSEE IN THAT CASE, DID NOT ARISE. A S AGAINST THE ABOVE IN THIS CASE THE ASSESSING OFFICER CONSCIOUSL Y CONSIDERED THE CLAIM FOR DEDUCTION UNDER SECTION 80IC OF THE A CT AS IS ADMITTEDLY EVIDENT FROM THE ISSUES RAISED DURING TH E REGULAR ASSESSMENT PROCEEDINGS. THIS BY ITSELF WOULD BE EVI DENCE OF THE FACT THAT THE ASSESSING OFFICER HAD OCCASION TO APP LY HIS MIND TO THE CLAIM FOR DEDUCTION UNDER SECTION 80IC OF THE A CT DURING THE 23 ITA NO.3768/DEL/2017 REGULAR ASSESSMENT PROCEEDINGS AND HAD TAKEN A VIEW ON THE CLAIM OF DEDUCTION UNDER SECTION 80IC OF THE ACT. 12. MOREOVER, WE FIND THAT THE REASONS. 5.7 THE SLP FILED AGAINST THE ABOVE DECISION OF THE HO NBLE HIGH COURT HAS BEEN DISMISSED BY THE HONBLE SUPREME COU RT IN THEIR ORDER DATED OCTOBER 2018, WHICH IS REPORTED IN (201 8) 99 TAXMANN.COM 206(SC). 5.8 IN THE CASE OF JALARAM ENTERPRISES PRIVATE LIMITED (SUPRA), CITED BY THE LEARNED COUNSEL OF THE ASSESS EE, THE ASSESSMENT FOR ASSESSMENT YEAR 2013-14 WAS COMPLETE D UNDER SECTION 143(3) ON 09/03/2016. THIS ASSESSMENT WAS R EOPENED ON 27/03/2018 (WITHIN PERIOD OF FOUR YEARS FROM THE EN D OF THE RELEVANT ASSESSMENT YEAR). THE REASONS RECORDED, TH E ASSESSING OFFICER MENTIONED THAT AS PER THE INFORMATION RECEI VED FROM INVESTIGATION WING, THE ASSESSEE WAS ONE OF THE BEN EFICIARY OF THE BOGUS ENTITIES, WHICH ARE CONTROLLED AND OPERATED B Y MR. VIPUL VIDHUR BHATT. THE HONBLE HIGH COURT IN THEIR ORDER DATED 01/03/2019 OBSERVED THAT SUMMONS WERE RECEIVED BY T HE ASSESSEE AND THE PERIOD RELEVANT TO ASSESSMENT YEAR 2010-11 AND, THEREFORE, ACTION TO REOPEN THE ASSESSMENT FOR 2013-14 WAS BAD IN LAW. THE HONBLE HIGH COURT RELIED ON THE FI NDING IN THE CASE OF ASSESSEES WRIT PETITION, WHEREIN IT IS HEL D AS UNDER: 5. UNDER SIMILAR CIRCUMSTANCES, WHILE DISPOSING OF ASSESSEE'S PETITION BEING WRIT PETITION NO. 11811 OF 2018, WE HAD ACCEPTED THE PETITIONER'S SUCH GROUND MAKING FOLLOWING OBSER VATIONS:- 8. WHILE DISPOSING OF THE OBJECTIONS, THE ASSESSING OFFICER DID NOT CLEARLY MEET WITH THIS OPPOSITION OF THE PETITIONER . HE INSTEAD, GAVE A RATHER GENERAL DISPOSAL TO THIS GROUND. THE PETITIONER HAS ALSO PRODUCED WITH THIS PETITION, CORRESPONDENCE EN TERED INTO BY THE PETITIONER WITH THE ASSESSING OFFICER DURING TH E ASSESSMENT 24 ITA NO.3768/DEL/2017 FOR THE ASSESSMENT YEAR 2010-11, IN WHICH THE PETIT IONER HAD SUPPLIED FULL DETAILS OF THE SAID RECEIPTS FROM THE SAID TWO ENTITIES. CLEARLY THEREFORE, THE PETITIONER HAS BUILT UP A ST RONG CASE TO ESTABLISH THAT THE RECEIPTS IN QUESTION NEVER RELAT ED TO THE PRESENT ASSESSMENT YEAR. THE ASSESSING OFFICER SIMPLY CANNO T TAKE SHELTER UNDER THE GROUND THAT ALL THESE ASPECTS CAN BE EXAMINED UNDER THE REASSESSMENT PROCEEDINGS. WHEN THE VERY F OUNDATION OF THE REASSESSMENT IS MISSING, IT WOULD BE IMPERMISSI BLE FOR THE ASSESSING OFFICER TO CARRY ON THE REASSESSMENT BASE D ON SUCH NOTICE. 5.9 EVIDENTLY, THE FACTS OF THE ABOVE CASE ARE DISTING UISHABLE FROM THE FACT OF THE INSTANT CASE AND, THEREFORE, T HE RATIO OF THE ABOVE DECISION IS NOT APPLICABLE IN THE CASE OF THE ASSESSEE. 5.10 IN THE CASE OF TULSI DEVELOPERS (SUPRA), ASSESSMENT FOR ASSESSMENT YEAR 2005-06 WAS COMPLETED UNDER SECTION 143(3) OF THE ACT ON 10/10/2007. IN THE SAID ASSESSMENT INTER EST INCOME FROM FIXED DEPOSITS WAS TREATED AS PART OF BUSINESS PROFIT AND DEDUCTION FOR SALARY TO THE PARTNERS WAS GIVEN ACCO RDINGLY AFTER COMPUTING BOOK PROFIT UNDER SECTION 40(B) OF THE AC T. THE ASSESSMENT WAS REOPENED BY VIEW OF ISSUE OF NOTICE DATED 05/02/2010 ON REASONS RECORDED THAT THE INTEREST FR OM FDR SHOULD HAVE BEEN TAXED UNDER THE HEAD INCOME FROM OTHER SOURCES AND THUS BOOK PROFIT AND SALARY TO THE PAR TNER HAD BEEN ALLOWED IN EXCESS IN THE REGULAR ASSESSMENT. IN BAC KGROUND OF THESE FACTS, THE HONBLE HIGH COURT IN THE ORDER DA TED 15/04/2011 HELD THAT ENTIRE FACTS IN RELATION TO FD R BANK INTEREST WERE AVAILABLE WITH THE ASSESSING OFFICER AND WHO FRAMED HIS OPINION THAT INTEREST FROM FDR WAS BUSINESS INC OME ONLY AND THEREFORE REOPENING AMOUNTS TO CHANGE OF OPINION. THE RELEVANT FINDING OF THE HONBLE HIGH COURT IS REPRODUCED AS UNDER: 25 ITA NO.3768/DEL/2017 9. INSOFAR AS THE EXCLUSION OF INTEREST INCOME WHI LE COMPUTING BOOK PROFIT IS CONCERNED, IT IS APPARENT THAT DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS, THE ENTIRE FACTS REGARDING FDR BANK INTEREST WERE FURNISHED TO THE THEN AO WHO APPEARS TO HAVE BEEN OF THE OPINION THAT THE ENTIRE INVESTMENT AND INCOM E PERTAINS TO BUSINESS ONLY AND ACCORDINGLY NET INCOME WAS WORKED OUT AND SALARY PAID TO PARTNERS UNDER S. 40(B) OF THE ACT C AME TO BE COMPUTED. CONSIDERING THE MATERIAL PLACED BEFORE TH E AO, IT WOULD APPEAR THAT THE AO MUST HAVE APPLIED HIS MIND IN TA KING INTO CONSIDERATION THE INTEREST INCOME WHILE COMPUTING B OOK PROFIT UNDER S. 40(B) OF THE: ACT. MOREOVER, IN THE LIGHT OF THE DECISION OF THE BOMBAY HIGH COURT IN THE CASE OF CIT VS. PARAMO UNT PREMISES (P) LTD. (SUPRA), THE VIEW TAKEN BY THE AO IS A PLA USIBLE VIEW. ONCE THE VIEW TAKEN BY THE AO IS A PLAUSIBLE VIEW, REOPENING OF ASSESSMENT ON THE GROUND THAT ANOTHER VIEW WHICH IS MORE BENEFICIAL TO THE REVENUE IS POSSIBLE, IS NOTHING B UT A MERE CHANGE OF OPINION. IN THE CIRCUMSTANCES IN THE LIGHT OF TH E DECISION OF THE SUPREME COURT IN THE CASE OF CIT VS. KELVINATOR OF INDIA LTD. (SUPRA) WHEREIN IT HAS BEEN HELD THAT ONE NEEDS TO GIVE A SCHEMATIC INTERPRETATION TO THE WORDS 'REASON TO BE LIEVE' FAILING WHICH, S. 147 WOULD GIVE ARBITRARY POWERS TO THE AO TO REOPEN ASSESSMENTS ON THE BASIS OF 'MERE CHANGE OF OPINION ', WHICH CANNOT BE PER SE REASON TO REOPEN; THE REOPENING OF ASSESSMENT IS BAD IN LAW. 5.11 IN THE CASE OF HK BUILDCON LTD. (SUPRA), ORIGINAL ASSESSMENT FOR ASSESSMENT YEAR 2005-06 WAS FRAMED ON 26/12/200 7 AND SUBSEQUENTLY, IT WAS REOPENED BY VIEW OF ISSUE OF N OTICE DATED 24/09/2009 (WITHIN FOUR YEARS FROM THE END OF THE R ELEVANT ASSESSMENT YEAR). THE ORIGINAL ASSESSMENT WAS COMPL ETED ON PROJECT COMPLETION METHOD, WHEREAS IN THE REASONS R ECORDED BY THE ASSESSING OFFICER RECORDED THAT THE ASSESSMENT SHOULD HAVE BEEN COMPLETED ON PERCENTAGE COMPLETION METHOD. THE HONBLE HIGH COURT IN THE ORDER DATED 12/04/2010 HELD THAT A SPECIFIC QUERY WAS RAISED BY THE ASSESSING OFFICER IN THE RE GULAR ASSESSMENT IN RELATION TO THE VERY ISSUE WHICH FORM S THE BASIS OF REASONS RECORDED IN THE PETITION AND REPLIED THE SA ME IN RESPONSE TO NOTICE UNDER SECTION 142(1) BEFORE THE ASSESSMEN T WAS 26 ITA NO.3768/DEL/2017 ORIGINALLY FRAMED, THUS THE SUCCESSOR AO HAS COME T O A DIFFERENT OPINION ON THE SAME SET OF THE FACTS. THE FINDING O F THE HONBLE HIGH COURT IS REPRODUCED AS UNDER: 9. A PLAIN READING OF THE REASONS RECORDED WOULD I NDICATE THAT THE ASSESSING OFFICER IS OF THE OPINION THAT THE ME THOD OF ACCOUNTING EMPLOYED BY THE ASSESSEE WAS TO BE GIVEN A GO-BYE AND ESTIMATED PROFIT HAD TO BE WORKED OUT BY APPLYI NG RATE OF 10 PER CENT TO THE VALUE OF WORK-IN-PROGRESS. IN THE E NTIRE REASONS RECORDED, THERE IS NOTHING ON RECORD TO SHOW AS TO WHAT INCOME HAD ESCAPED ASSESSMENT FOR WHICH THE ASSESSING OFFI CER RECEIVED INFORMATION SUBSEQUENTLY, EITHER FROM EXTERNAL SOUR CE, OR FROM ANY OTHER SOURCE. 10. AS AGAINST THAT, WHEN ONE GOES THROUGH THE VARI OUS SUBMISSIONS MADE BY THE PETITIONER IN RESPONSE TO N OTICES UNDER SECTION 142(1) OF THE ACT, BEFORE THE ASSESSMENT WA S ORIGINALLY FRAMED ON 26-12-2007, IT BECOMES CLEAR THAT IN RELA TION TO THE VERY ISSUE WHICH FORMS THE BASIS OF REASONS RECORDED, A SPECIFIC QUERY WAS RAISED BY THE ASSESSING OFFICER AND THE PETITIO NER HAD REPLIED ON 24-12-2007 IN THE FOLLOWING WORDS: (1) ACCOUNTING SYSTEM ADOPTED: WE ARE FOLLOWING COMPLETION METHOD FOR TRANSFERRING WORK-IN- PROGRESS TO LAND AND BUILDING ACCOUNT SINCE WE DIRE CTLY PURCHASE MATERIALS AND HIRE LABOURS FOR DEVELOPMENT AND CONS TRUCTION ACTIVITY. WE BOOK THE MEMBERS ON THEIR INTEREST BAS IS IRRESPECTIVE OF STAGE OF WORK. WE ALLOT SHARES TO THEM TO PART W ITH OWNERSHIP OF LAND AND BUILDING. WE ARE NOT PREPARING ANY PROF IT AND LOSS ACCOUNT FOR OUR COMPANY IN THE PERIOD OF CONSTRUCTI ON AS ALL THE EXPENDITURE ARE DEBITED TO WORK-IN-PROGRESS AND TRA NSFER AT THE COMPLETION OF WORK TO LAND AND BUILDING ACCOUNT ON ONE SIDE AND MEMBERS CONTRIBUTION TO RESERVE AND SURPLUS ACCOUNT UNDER BUILDING FUND. WE ARE ENCLOSING HEREWITH DETAILS OF DWELLING AND SHOP UNITS PROPOSED FLOOR-WISE ALONG WITH TOTAL SIZ E OF FLOOR AND CONSTRUCTED AREAS FOR YOUR KIND PERUSAL. ANNEX. 1. 11. THUS, IT IS APPARENT THAT, ON THE SAME SET OF F ACTS AND MATERIAL AVAILABLE ON RECORD, THE SUCCESSOR ASSESSI NG OFFICER HAS COME TO FORM A DIFFERENT OPINION AND RECORDED REASO NS THEREUPON WITHOUT ESTABLISHING ANY LAPSE ON PART OF THE PETIT IONER OR ANY FRESH INFORMATION. THE SETTLED LEGAL POSITION IN TH IS REGARD HAS BEEN REITERATED BY THE APEX COURT RECENTLY IN THE C ASE OF CIT V. KELVINATOR OF INDIA LTD. : (2010) 2 SCC 723:(2010) 34 DTR (SC) 49, WHEREIN THE COURT HAS HELD IN PARA NO. 6 OF THE JUD GMENT THAT THERE IS A CONCEPTUAL DIFFERENCE BETWEEN POWER TO R EVIEW AND 27 ITA NO.3768/DEL/2017 POWER TO REASSESS. THE ASSESSING OFFICER HAS NO POW ER TO REVIEW; HE HAS ONLY POWER TO REASSESS. IT IS FURTHER LAID D OWN THAT REASSESSMENT HAS TO BE BASED ON FULFILLMENT OF CERT AIN PRECONDITION AND IF THE CONCEPT OF CHANGE OF OPINIO N IS REMOVED, THEN, IN THE GARB OF REOPENING THE ASSESSMENT, REVI EW WOULD TAKE PLACE. IT IS FURTHER LAID DOWN THAT ONE MUST TREAT THE CONCEPT OF CHANGE OF OPINION AS AN INBUILT TEST TO CHECK ABUSE OF POWER BY THE ASSESSING OFFICER. AFTER REFERRING TO CIRCULAR NO. 549, DATED 31- 10-1989, EXPLAINING THE AMENDMENT MADE BY AMENDING ACT, 1989 TO REINTRODUCE THE EXPRESSION REASON TO BELIEVE IN SECTION 147 OF THE ACT, THE APEX COURT HAS COME TO THE CONCLUSION THAT IF THE PHRASE REASON TO BELIEVE IS OMITTED, THE SAME WOULD GIVE ARBITRARY POWERS TO THE ASSESSING OFFICER TO REOPEN THE PAST ASSESSMENT ON MERE CHANGE OF OPINION AND THIS IS NOT PERMISSIBLE EVEN AS PER LEGISLATIVE INTENT. 5.12 IN THE CASE OF NITYANAND INFRASTRUCTURE LTD. (SUPRA) ALSO THE TRIBUNAL OBSERVED THAT THE ASSESSING OFFICER HA D CALLED FOR ASSESSEES EXPLANATION ON THE ISSUE, WHICH WAS IN O PINION NEEDED CONSIDERATION AND ONLY AFTER VERIFICATION OF THE DE TAILS PASSED THE ORIGINAL ASSESSMENT ORDER, ACCORDINGLY, IT WAS HELD THAT ONCE AN ASSESSMENT IS COMPLETED UNDER SECTION 143(3) OF THE ACT, AFTER RAISING A QUERY ON THE PARTICULAR ISSUE AND ACCEPTI NG ASSESSEES REPLY TO THE QUERY, THE AO HAD NO JURISDICTION TO R EOPEN THE ASSESSMENT UNLESS AND UNTIL THERE IS ADDITIONAL INFORMATION/TANGIBLE MATERIAL BEFORE THE ASSESSING OFFICER TO COME TO THE CONCLUSION THAT THERE IS ESCAPEMENT OF INCOME. SIMILAR FINDING HAS BEEN GIVEN BY THE TRIBUNAL IN T HE CASE OF MS. SEEMA DILIP VOHRA (SUPRA). THE RELEVANT PARAGRAPH OF THE DECISION IS REPRODUCED AS UNDER: 2.19. UNDER THE AMENDED PROVISIONS OF SECTION 147, AN ASSESSMENT CAN BE REOPENED IF THE ASSESSING OFFICER HAS 'REASON TO BELIEVE' THAT INCOME CHARGEABLE TO TAX HAS ESCAP ED ASSESSMENT; BUT IF HE WANTS TO DO SO AFTER A PERIOD OF FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR, HE CAN DO SO O NLY IF THE ASSESSEE HAS FALLEN SHORT OF HIS DUTY TO DISCLOSE F ULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT. IT DOE S NOT FOLLOW THAT HE CANNOT REOPEN THE ASSESSMENT EVEN WITHIN TH E PERIOD OF 28 ITA NO.3768/DEL/2017 FOUR YEARS AS AFORESAID IF HE HAS REASON TO BELIEVE THAT THE ASSESSEE HAS FAILED TO MAKE THE REQUISITE DISCLOSUR E. ALL THAT THE SECTION SAYS IS THAT IN A CASE WHERE THE ASSESSMENT IS SOUGHT TO BE REOPENED AFTER THE PERIOD OF FOUR YEARS, THE ONL Y REASON AVAILABLE TO THE ASSESSING OFFICER IS THE NON-DISCL OSURE OF MATERIAL FACTS ON THE PART OF THE ASSESSEE. THE ACT PLACES A GENERAL DUTY ON EVERY ASSESSEE TO FURNISH FULL AND TRUE PARTICULARS ALONG WITH THE RETURN OF INCOME OR IN THE COURSE OF THE ASSESSMENT PROCEEDINGS SO THAT THE ASSESSING OFFICER IS ENABLED TO COMPUTE TH E CORRECT AMOUNT OF INCOME ON WHICH THE ASSESSEE SHALL PAY TA X. THE POSITION HAS BEEN FURTHER CLARIFIED BY THE PROVISO ITSELF IN A CASE WHERE ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 1 44 OF THE ACT OR THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSE SSMENT YEAR, NO ACTION SHALL BE TAKEN AFTER THE EXPIRY OF FOUR Y EARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH YEAR BY THE REA SON OF FAILURE ON THE PART OF THE ASSESSEE TO MAKE A RETUR N U/S 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION (1) O F SECTION 142 OR SECTION 148 OR TO DISCLOSE TRULY AND FULLY ALL MATE RIAL FACTS NECESSARY FOR HIS ASSESSMENT FOR THAT ASSESSMENT YE AR. IT IS ALSO NOTED THAT THE SCOPE OF NEWLY SUBSTITUTED (W.E.F. 0 1/04/1989) SECTION 147 HAS BEEN ELABORATED IN DEPARTMENT CIRCU LAR NUMBER 549 DATED 31ST OCTOBER, 1989, MEANING THEREBY, ON O R AFTER 01/04/ 1989, INITIATION OF REASSESSMENT PROCEEDINGS HAS TO BE GOVERNED BY THE PROVISIONS OF SECTION 147 TO 151 AS SUBSTITUTED (AMENDED) W.E.F. 01/04/1989. STILL, POWER U/S 147 O F THE ACT, THOUGH VERY WIDE BUT NO PLENARY. WE ARE AWARE THAT HONBLE GUJARAT HIGH COURT IN PRAFUL CHUNILAL PATEL: VASANT CHUNILAL PATEL VS ACIT (1999) 236 ITR 82, 840 (GUJ.) EVEN WENT TO THE EXTENT THAT ACTION UNDER MAIN SECTION 147 IS POSSIBLE IN SPITE OF COMPLETE DISCLOSURE OF MATERIAL FACTS. THE PRIMARY CONDITION OF REASONABLE BELIEF HAVING NEXUS WITH THE MATERIAL ON RECORD IS STILL OPERATIVE. HOWEVER, WE ARE OF THE VIEW, THAT MERE FRESH APPLIC ATION OF MIND TO THE SAME SET OF FACTS OR MERE CHANGE OF OPINION DOES NOT CONFER JURISDICTION TO THE ASSESSING OFFICER EVEN U NDER THE POST 1989 SECTION 147 OF THE ACT. OUR VIEW FIND SUPPORT FROM THE DECISION FROM HONBLE DELHI HIGH COURT IN JINDAL PH OTO FILMS LTD. VS DCIT (1998) 234 ITR 170 (DEL.), GARDEN SILK MILL S PVT. LTD. VS DCIT (1999) 151 CTR (GUJ.) 533, GOVIND CHHAPABHAI P ATEL VS DCIT 240 ITR 628, 630 (GUJ.), FORAMER VS CIT (2001) 247 ITR 436 (ALL.), AFFIRMED IN CIT VS FORAMER FINANCE (2003) 2 64 ITR 566, 567 (SC), IPICA LABORATORIES VS DCIT (2001) 251 ITR 416 (BOM.), RITU INVESTMENT PVT. LTD.(2012) 345 ITR 214 (DEL.), KETA N B. MEHTA VS ACIT (2012) 346 ITR 254 (GUJ.), MS. PRAVEEN P. BHAR UCHA VS DCIT (2012) 348 ITR 325 (BOM.), CIT VS USHA INTERNATIONA L LTD. 348 ITR 485 (DEL.), AGRICULTURAL PRODUCE MARKET COMMITTEE V S ITO (2013) 355 ITR 348 (GUJ.), B.B.C. WORLD NEWS LTD. VS ASST. DIT (2014) 362 ITR 577 (DEL.). IDENTICAL RATIO WAS LAID DOWN I N CIT VS 29 ITA NO.3768/DEL/2017 MALAYALA MANORMA COMPANY LTD. (2002) 253 ITR 378 (K ER.) WE THINK THIS THREAD RUNS THROUGH THE VARIOUS PROVISIO NS OF THE ACT. BUT EXPLANATION 1 TO THE SECTION CONFINES THE DUTY TO THE DISCLOSURE OF ALL PRIMARY AND MATERIAL FACTS NECESS ARY FOR THE ASSESSMENT, FULLY AND TRULY. AS TO WHAT ARE MATERIA L OR PRIMARY FACTS WOULD DEPEND UPON THE FACTS AND CIRCUMSTANCES OF EACH CASE AND NO UNIVERSAL FORMULA MAY BE ATTEMPTED. THE LEGAL OR FACTUAL INFERENCES FROM THOSE PRIMARY OR MATERIAL F ACTS ARE FOR THE ASSESSING OFFICER TO DRAW IN ORDER TO COMPLETE THE ASSESSMENT AND IT IS NOT FOR THE ASSESSEE TO ADVISE HIM, FOR O BVIOUS REASONS. THE EXPLANATION, HOWEVER, CAUTIONS THE ASSESSEE THA T HE CANNOT REMAIN SMUG WITH THE BELIEF THAT SINCE THE ASSESSEE HAS PRODUCED THE BOOKS OF ACCOUNT BEFORE THE ASSESSING OFFICER F ROM WHICH MATERIAL OR EVIDENCE COULD HAVE BEEN WITH DUE DILIG ENCE GATHERED BY HIM,HE HAS DISCHARGED HIS DUTY. IT IS FOR HIM TO POINT OUT THE RELEVANT ENTRIES WHICH ARE MATERIAL, WITHOUT LEAVIN G THAT EXERCISE TO THE ASSESSING OFFICER. THE CAVEAT, HOWEVER, IS T HAT SUCH PRODUCTION OF BOOKS OF ACCOUNT MAY, IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES, AMOUNT TO FULL AND TRUE DISCLOSURE; THIS IS CLEAR FROM THE USE OF THE EXPRESSION 'NOT NECESSARILY' IN THE EXPLANATION. THUS, THE QUESTION OF FULL AND TRUE DI SCLOSURE OF PRIMARY OR MATERIAL FACTS IS A PURE QUESTION OF FAC T, TO BE DETERMINED ON THE FACTS AND CIRCUMSTANCES OF EACH C ASE. NO GENERAL PRINCIPLE CAN BE LAID DOWN. IT WAS OBSERVED BY THE HON HIE APEX COURT, IN VARIOUS CASES THAT THERE SHOULD BE SOME 'TANGIBLE MATERIAL' COMING INTO THE POSSESSION OF T HE ASSESSING OFFICER IN SUCH CASES TO ENABLE HIM TO RESORT TO SE CTION 147 OF THE ACT. DESPITE BEING A CASE OF FULL AND TRUE DISCLOSU RE, TANGIBLE MATERIAL COMING TO THE POSSESSION OF THE ASSESSING OFFICER AFTER HE MADE THE ORIGINAL ASSESSMENT UNDER SECTION 143(3), WOULD INFLUENCE THE OPINION, FORMED OR PRESUMED TO HAVE B EEN FORMED EARLIER, BY THE ASSESSING AUTHORITY; HE CAN WITH JU STIFICATION CHANGE IT, BUT THAT WOULD NOT BE A CASE OF A 'MERE CHANGE OF OPINION' UNGUIDED BY NEW FACTS OR CHANGE IN THE LEG AL POSITION. IT WILL BE A CASE OF THE ASSESSING AUTHORITY HAVING 'R EASON TO BELIEVE', NOTWITHSTANDING THAT FULL AND TRUE PARTIC ULARS WERE FURNISHED BY THE ASSESSEE WHICH WERE EXAMINED, OR P RESUMED TO BE EXAMINED, BY HIM. THERE WAS A DIVERGENCE OF OPIN ION AMONGST VARIOUS HIGH COURTS AS TO WHAT CONSTITUTE INFORMAT ION FOR THE PURPOSES OF SECTION 34(1 )(B) OF THE 1922 ACT (WHIC H CORRESPONDS TO SECTION 147(B) OF THE 1961 ACT) THE HONBLE APEX CO URT IN CWT VS IMPERIAL TOBACCO COMPANY LTD. (1966) 61 ITR 461 HAS NOTED SUCH DIVERGENCE OF OPINION ON THE POINT. HONBLE JURISDI CTIONAL HIGH COURT IN CIT VS SIR MOHAMMAD YUSUF ISMAIL (1944) 12 ITR 8 (BOM.) HELD THAT MERE CHANGE OF OPINION ON THE SAME FACTS ARE ON QUESTION OF LAW OR MERE DISCOVERY OF MISTAKE OF LAW IS NOT SUFFICIENT INFORMATION AND THAT IN ORDER TO SUSTAIN ACTION U/S 34 BY FURTHER HOLDING THAT REASSESSMENT IS NOT PERMISS IBLE. THE 30 ITA NO.3768/DEL/2017 HONBLE APEX COURT IN SIMON CARVES LTD. (1976) 105 ITR 212 HELD THAT ERRORLESS LEGALLY CORRECT ORDER CANNOT BE REOP ENED, THEREFORE, IT IS SETTLED LAW THAT WITHOUT ANY NEW INFORMATION AND ON THE BASIS OF MERE CHANGE OF OPINION, REOPENING OF ASSES SMENT IS NOT PERMISSIBLE. AS WAS HELD IN CIT VS TTK PRESTIGE LTD . (2010) 322 ITR 390 (KARN.) SLP DISMISSED IN 2010 322 ITR (ST.) 14 (SC). REFERENCE ALSO MADE TO ASIAN PAINTS LTD. VS DCIT (2 009) 308 ITR 195 (BOM.), ANDHRA BANK LTD. VS CIT (1997) 225 ITR 447 (SC). THE OBSERVATIONS OF THE SUPREME COURT ARE A PROTECT ION AGAINST THE ABUSE OF POWER; THEY ALSO PROTECT THE REVENUE W HICH CAN, IN THE LIGHT OF SUBSEQUENT COMING INTO LIGHT OF FACTS OR LAW, REOPEN THE ASSESSMENT. IN THE LIGHT OF THE AFORESAID DISCUSSIO N, SINCE, THERE WAS NO NEW TANGIBLE MATERIAL AVAILABLE WITH THE ASS ESSING OFFICER WHILE RESORTING TO SECTION 147/148 OF THE ACT, MORE SPECIFICALLY, WHILE FRAMING ORIGINAL ASSESSMENT U/S 143(3) OF THE ACT, THERE WAS FULL DISCLOSURE OF MATERIAL FACTS BY THE ASSESS EE AND ON THE BASIS OF THOSE FACTS, ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT. 5.13 IN THE CASE OF REPLIKA PRESS PRIVATE LIMITED & ANR (SUPRA), THE ASSESSMENT YEAR INVOLVED IS 2006-07 AN D THE REASSESSMENT PROCEEDINGS WERE INITIATED WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE SAID A SSESSEE WAS ENGAGED IN THE BUSINESS OF PRINTING OF TEXT BOOKS A ND IN THE ORIGINAL ASSESSMENT DEDUCTION UNDER SECTION 10B OF THE ACT WAS ALLOWED TO THE ASSESSEE. SUBSEQUENTLY, IN THE REASO NS TO BELIEVE RECORDED, THE ASSESSING OFFICER NOTED THAT ACCORDIN G TO CBDT CIRCULAR NO. 347 DATED 07/07/1982, THE ASSESSEE WAS NOT A MANUFACTURER FOR THE PURPOSE OF DEDUCTION UNDER SEC TION 10B OF THE ACT. THE HONBLE HIGH COURT IN THE ORDER DATED 05/08/2013 OBSERVED THAT AS PER THE REASONS TO BELIEVE, THE AO HAD FORMED AN ERRONEOUS LEGAL OPINION IN THE ORIGINAL ASSESSMENT ORDER AND THUS HELD THAT SUCH CASES CANNOT BE COVERED AND CANNOT B E MADE SUBJECT OF REASSESSMENT PROCEEDING UNDER SECTION 14 7 OF THE ACT AND APPROPRIATE REMEDY AVAILABLE TO THE REVENUE WAS TO INITIATE 31 ITA NO.3768/DEL/2017 PROCEEDING UNDER 263 OF THE ACT. THE RELEVANT FINDING OF THE HONBLE HIGH COURT IS REPRODUCED AS UNDER: 11. LEARNED COUNSEL FOR THE RESPONDENT-ASSESSEE HA S DRAWN OUR ATTENTION TO THE FULL BENCH DECISION OF THIS CO URT IN COMMISSIONER OF INCOME TAX VS. USHA INTERNATIONAL L TD., [2012] 348 ITR 485 (DELHI) WHEREIN, REFERENCE IS MADE TO T HE JUDGMENT OF THE SUPREME COURT IN ALA FIRM VS. CIT, (1991) 189 I TR 285 (SC). OUR ATTENTION WAS DRAWN TO PROPOSITION NO.4; THAT I NFORMATION AS REQUIRED BY SECTION 147(B) CAN RELATE TO AN EARLIER DECISION ON THE POINT OF LAW BUT THAT INFORMATION SHOULD HAVE COME TO THE KNOWLEDGE OF THE ASSESSING OFFICER BY HIS OWN EFFOR TS. SUCH INFORMATION MAY BE GATHERED AFTER EXAMINATION OF TH E ASSESSMENT RECORDS. DECISION IN WAS REFERRED TO IN USHA INTERN ATIONAL (SUPRA) IN A DIFFERENT CONTEXT AND PURPOSE. OBSERVATIONS MA DE BY THE SUPREME COURT WAS WITH REFERENCE TO THE TERM 'INFOR MATION' AND CONCEPTUALLY THERE IS A DIFFERENCE BETWEEN THE SCOP E AND AMBIT OF THE REASSESSMENT PROVISIONS INCORPORATED WITH EFFEC T FROM 1ST APRIL, 1989. THE NEW STATUTORY PROVISIONS DO NOT RE FER TO THE WORD 'INFORMATION' AND NATURE, TYPE OR CHARACTER OF INFO RMATION. NO DOUBT, THE SCOPE AND AMBIT OF THE AMENDED REASSESSM ENT PROVISIONS IS WIDER, BUT WHAT IS RELEVANT AND IMPOR TANT IS THAT CASES OF 'CHANGE OF OPINION' ARE NOT COVERED OR PRO TECTED UNDER THE RE-ENACTED REOPENING PROVISIONS. 5.14 IN THE CASE OF RASALIKA TRADING AND INVESTMENT COMPANY PRIVATE LIMITED (SUPRA), THE ASSESSMENT FOR ASSESSMENT YEAR 2005-06 WAS COMPLETED ON 24/12/2007 UNDER SECTION 1 43(3) OF THE ACT. SUBSEQUENTLY, ON RECEIPT OF INFORMATION FR OM THE DIT (INVESTIGATION), THAT THE ASSESSEE IS BENEFICIARY O F BOGUS ACCOMMODATION ENTRIES, THE ASSESSMENT WAS REOPENED BY VIEW OF ISSUE OF NOTICE UNDER SECTION 148 OF THE ACT. BEFOR E THE HONBLE HIGH COURT, THE ASSESSEE SUBMITTED THAT THE MATERIA L ON THE BASIS OF WHICH RECORDS TO SECTION 148 OF THE ACT WAS PRO POSED, EXISTED EVEN WHEN THE ORIGINAL REGULAR ASSESSMENT WAS COMPL ETED AND THEREFORE REASONS RECORDED WERE BASED ON STALE MATE RIAL. IT WAS SUBMITTED THAT MATTER HAD BEEN SPECIFICALLY ENQUIRE D AND GONE INTO BY THE REVENUE. THE HONBLE HIGH COURT IN THE ORDER DATED 32 ITA NO.3768/DEL/2017 14/02/2014 HELD THAT THE ISSUE ALREADY ENQUIRED IN ORIGINAL ASSESSMENT PROCEEDINGS ON THE BASIS OF THE INFORMAT ION AVAILABLE, IT AMOUNTS TO CHANGE OF OPINION. THE RELEVANT FIN DING OF THE HONBLE HIGH COURT IS REPRODUCED AS UNDER: IT IS EVIDENT FROM THE ABOVE DISCUSSION THAT THE R EASSESSMENT PROCEEDINGS WERE INITIATED BY THE IMPUGNED NOTICE W HICH EXPRESSLY AND PLAINLY STATES THAT 'REASONS TO BELIE VE' ARE BASED UPON THE MATERIALS CONTAINED IN AN INVESTIGATION RE PORT OF 13.3.2006. THE NOTICE ITSELF DOES NOT SPELL OUT THA T THE REPORT WAS NOT ON THE RECORD WHEN THE ORIGINAL ASSESSMENT WAS COMPLETED ON 24.12.2007 NOR DID THE REVENUE EVEN SUGGEST SO IN T HE COUNTER AFFIDAVIT FILED IN THE PROCEEDINGS. IT IS ONLY IN A SUBSEQUENTLY FILED ADDITIONAL AFFIDAVIT THAT THE POSITION IS SOUGHT TO BE CLARIFIED. CLEARLY THIS COURT REFRAINS FROM MAKING SUCH AN ENQ UIRY, AT A TIME WHEN THE AO HAS, IN THE FIRST INSTANCE, FAILED TO S PELL OUT CLEARLY IN THE SECTION 148 NOTICE ITSELF THAT SUCH REPORT WAS NOT ON RECORD. IN OTHER WORDS 'THE REASONS TO BELIEVE' DO NOT STATE T HAT EVEN IN ONE SENTENCE THAT THE INVESTIGATION REPORT OF 13.3.2006 WAS NOT WITH THE AO WHEN HE COMPLETED THE ASSESSMENT. THE MATERI AL ON RECORD IN FACT SUGGESTS OTHERWISE; THE NATURE OF TH E QUERIES PUT TO ASSESSEE AND THE REPLIES AND CONFIRMATION FURNISHED TO THE AO IN THE COURSE OF THE REGULAR ASSESSMENT CLARIFY THAT W HAT EXCITED THE SUSPICION WAS INDEED GONE INTO BY THE AO HIMSELF WH ILE FRAMING THE ASSESSMENT UNDER SECTION 143(3). THIS COURT IS FORTIFIED IN ITS CONCLUSIONS BY THE DECISION OF THE SUPREME COURT IN COMMISSIONER OF POLICE V. GOVERDHAN DAS BHANJI AIR 1952 SC 16 WH ERE IT WAS HELD THAT PUBLIC ORDERS MADE BY PUBLIC AUTHORITIES INTENDED TO HAVE EFFECT ON THE PUBLIC SHOULD BE CONSTRUED OBJEC TIVELY WITH REFERENCE TO THE LANGUAGE USED RATHER THAN EXPLANAT IONS SUBSEQUENTLY OFFERED. THIS PRINCIPLE WAS REITERATED IN A SOMEWHAT DIFFERENT VEIN IN MS GILL V. CHIEF ELECTION COMMISS IONER, AIR 1978 SC 851 BY THE SUPREME COURT. SUCH BEING THE CASE TH IS COURT HAS NO DOUBT THAT THE IMPUGNED NOTICE, IN THE CIRCUMSTA NCES OF THE CASE IS BASED UPON STALE INFORMATION WHICH WAS AVAI LABLE AT THE TIME OF THE ORIGINAL ASSESSMENT AND IN FACT APPEARS TO HAVE BEEN USED BY THE AO AT THE RELEVANT TIME I.E. DURING THE COMPLETION OF PROCEEDINGS UNDER SECTION 143(3). THEREFORE, THE AT TEMPT TO REOPEN THE PROCEEDINGS UNDER SECTION 147/148 IS REALLY THE RESULT OF A CHANGE OF OPINION - AND THUS BEYOND THE PALE OF THE AD'S JURISDICTION AND FALLING UNDER THE ILLUSTRATION SPE LT OUT IN KELVINATOR (INDIA) LTD. (SUPRA). CONSEQUENTLY, THE IMPUGNED NOTICE AND ALL PROCEEDINGS FURTHER THERETO ARE BEYOND THE AUTHORITY OF LAW AND ARE HEREBY QUASHED. 33 ITA NO.3768/DEL/2017 5.15 IN THE CASE OF TUPPERWARE INDIA PRIVATE LIMITED (SUPRA), THE RETURN OF INCOME FILED BY THE ASSESSEE FOR ASSE SSMENT YEAR 2003-04 WAS PROCESSED UNDER SECTION 143(1) OF THE A CT AND NO ASSESSMENT UNDER SECTION 143(3) OF THE ACT WAS COMP LETED. THE NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON 2 1/10/2005 (WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASS ESSMENT YEAR). IN THE REASONS RECORDED, THE ASSESSING OFFICER NOTE D THAT IN THE AUDIT REPORT IT WAS MENTIONED THAT THE ASSESSEE HAD MADE CERTAIN PAYMENTS WITHOUT DEDUCTION OF TAX AT SOURCE AND, TH EREFORE, SUCH PAYMENT WAS INADMISSIBLE UNDER SECTION 40(A)(IA) OF THE ACT. THE HONBLE HIGH COURT IN THE ORDER DATED 10/08/2015 OB SERVED THAT QUESTION EXAMINED BY THE COURT IN CIT VS. ORIENT CRA FT LTD., (2013) 354 ITR 536 (DEL.), WAS IDENTICAL TO THE QUE STION SOUGHT TO BE PROJECTED BY THE REVENUE IN THE APPEAL. 5.16 IN THE CASE OF MADHUKAR KHOSLA VS ACIT (SUPRA), THE HONBLE DELHI HIGH COURT HELD THAT IN ABSENCE OF TR IGGER IN THE FORM OF NEW MATERIAL, THE REASSESSMENT CANNOT BE VA LID AS THE ASSESSING OFFICER DID NOT POSSESS JURISDICTION TO R EOPEN THE ASSESSMENT. THE HONBLE HIGH COURT OBSERVED THAT WH ETHER THE REOPENING AMOUNTS OR REVIEW THE CHANGE OF THE OPINI ON IS NEXT STAGE. THE RELEVANT FINDING OF THE HONBLE HIGH CO URT IS REPRODUCED AS UNDER: 9. IN THIS CASE, THE REASONS PROVIDED UNDER SECTIO N 148 ARE THAT IN ABSENCE OF THE SOURCE OF THE ADDITION WITH DOCU MENTARY EVIDENCE ON RECORDS, THE SAME IS REQUIRED TO BE BRO UGHT ON TAX NET AS PER PROVISIONS OF SECTION 68 OF THE INCOME TAX A CT, 1961 AS THE ASSESSEE HAD OFFERED NO EXPLANATION ABOUT THE NATUR E AND SOURCE OF THE SAID ADDITIONS AND THUS, MUST BE TREATED A S INCOME WHICH ESCAPED ASSESSMENT. NO DETAILS ARE PROVIDED A S TO WHAT SUCH INFORMATION IS WHICH EXCITED THE AOS NOTICE A ND ATTENTION. THE REASONS MUST INDICATE SPECIFICALLY WHAT SUCH OB JECTIVE AND 34 ITA NO.3768/DEL/2017 NEW MATERIAL FACTS ARE, ON THE BASIS OF WHICH A REO PENING IS INITIATED UNDER SECTION 148. THIS REASSESSMENT IS C LEARLY NOT ON THE BASIS OF NEW (OR TANGIBLE) INFORMATION OR FAC TS THAT WHICH THE REVENUE CAME BY. IT IS IN EFFECT A RE-APPRECIATION OR REVIEW OF THE FACTS THAT WERE PROVIDED ALONG WITH THE ORIGINAL RE TURN FILED BY THE ASSESSE. THE SUPREME COURT IN KELVINATOR (SUPRA) FR OWNED AGAINST SUCH EXERCISE OF POWER: HOWEVER, ONE NEEDS TO GIVE A SCHEMATIC INTERPRETAT ION TO THE WORDS 'REASON TO BELIEVE' FAILING WHICH, WE ARE AFRAID, SECTION 147 WOULD GIVE ARBITRARY POWERS TO THE ASSE SSING OFFICER TO RE-OPEN ASSESSMENTS ON THE BASIS OF 'MER E CHANGE OF OPINION', WHICH CANNOT BE PER SE REASON TO RE-OP EN. WE MUST ALSO KEEP IN MIND THE CONCEPTUAL DIFFERENCE BE TWEEN POWER TO REVIEW AND POWER TO RE-ASSESS. THE ASSESSI NG OFFICER HAS NO POWER TO REVIEW; HE HAS THE POWER TO RE- ASSESS. BUT RE-ASSESSMENT HAS TO BE BASED ON FULFIL LMENT OF CERTAIN PRE-CONDITION AND IF THE CONCEPT OF 'CHANGE OF OPINION' IS REMOVED, AS CONTENDED ON BEHALF OF THE DEPARTMENT, THEN, IN THE GARB OF RE-OPENING THE ASS ESSMENT, REVIEW WOULD TAKE PLACE. ONE MUST TREAT THE CONCEPT OF 'CHANGE OF OPINION' AS AN IN-BUILT TEST TO CHECK AB USE OF POWER BY THE ASSESSING OFFICER. HENCE, AFTER 1 ST APRIL, 1989, ASSESSING OFFICER HAS POWER TO RE-OPEN, PROVIDED TH ERE IS 'TANGIBLE MATERIAL' TO COME TO THE CONCLUSION THAT THERE IS ESCAPEMENT OF INCOME FROM ASSESSMENT. REASONS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. . 11. THE FOUNDATION OF THE AOS JURISDICTION AND THE RAISON DETRE OF A REASSESSMENT NOTICE ARE THE REASONS TO BELIEVE. NOW THIS SHOULD HAVE A RELATION OR A LINK WITH AN OBJECTIVE FACT, IN THE FORM OF INFORMATION OR FACTS EXTERNAL TO THE MATERIALS O N THE RECORD. SUCH EXTERNAL FACTS OR MATERIAL CONSTITUTE THE DRIV ER, OR THE KEY WHICH ENABLES THE AUTHORITY TO LEGITIMATELY RE-OPEN THE COMPLETED ASSESSMENT. IN ABSENCE OF THIS OBJECTIVE TRIGGER, THE AO DOES NOT POSSESS JURISDICTION TO REOPEN THE ASSESSMENT. IT I S AT THE NEXT STAGE THAT THE QUESTION, WHETHER THE RE-OPENING OF ASSESSMENT AMOUNTS TO REVIEW OR CHANGE OF OPINION ARISES. IN OTHER WORDS, IF THERE ARE NO REASONS TO BELIEVE BASED ON NEW, TANGIBLE MATERIALS, THEN THE REOPENING AMOUNTS TO AN IMPERM ISSIBLE REVIEW. HERE, THERE IS NOTHING TO SHOW WHAT TRIGGER ED THE ISSUANCE OF NOTICE OF REASSESSMENT NO INFORMATION OR NEW FACTS WHICH LED THE AO TO BELIEVE THAT FULL DISCLOSURE HA D NOT BEEN MADE. THE IMPUGNED NOTICE, THE AOS ORDER REJECTING THE OBJECTIONS, AND THE ARGUMENTS OF THE REVENUE NOWHER E INDICATE HOW THE AO WAS IMPELLED TO SEEK RE-OPENING OF THE A SSESSEES 35 ITA NO.3768/DEL/2017 CASE, AS DISTINGUISHED FROM THE SEVERAL OTHER COMPL ETED ASSESSMENTS. 5.17 IN THE CASE OF TURNER BROADCASTING SYSTEM ASIA-PACIFIC INC. (SUPRA), TO ASSESSMENT YEARS I.E. ASSESSMENT YEAR 2 007-08 AND ASSESSMENT YEAR 2008-09 ARE INVOLVED. IN BOTH A SSESSMENT YEARS ASSESSMENTS ARE COMPLETED UNDER SECTION 143(3 ) OF THE ACT AND NOTICES UNDER SECTION 148 OF THE ACT WERE ISSUE D WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE HONBLE HIGH COURT IN THE ORDER DATED 08/10/2015 HELD THAT ON PERUSAL OF THE REGULAR ASSESSMENT ORDERS, IT WAS CLEAR THAT ON OPINION WAS FORMED BY THE ASSESSING OFFICER ON THE ISSUE OF TAX ATION OF ADVERTISEMENT AND DISTRIBUTION REVENUE, AND THE REA SONS RECORDED FOR REASSESSMENT, THE ASSESSING OFFICER MERELY INTE NDED TO REVISIT THE CONCLUDED ASSESSMENT AND IT WAS A CLEAR CASE OF CHANGE OF OPINION, WHICH WAS NOT PERMISSIBLE UNDER LAW. THE R ELEVANT FINDING OF THE HONBLE HIGH COURT IS REPRODUCED AS UNDER: 16. THE POWER TO REOPEN AN ASSESSMENT WAS CONFERRE D BY THE LEGISLATURE BUT NOT WITH THE INTENTION TO ENABLE TH E ITO TO REOPEN THE FINAL DECISION MADE AGAINST THE REVENUE IN RESP ECT OF QUESTIONS THAT DIRECTLY AROSE FOR DECISION IN EARLI ER PROCEEDINGS. IF THAT WERE NOT THE LEGAL POSITION, IT WOULD RESULT I N PLACING AN UNRESTRICTED POWER OF REVIEW IN THE HANDS OF THE AS SESSING AUTHORITIES DEPENDING ON THEIR CHANGING MOODS - CIT V. RAO THAKUR NARAYAN SINGH [1965] 56 ITR 234 , 239(SC). 17. IN PHOOL CHAND BAJRANG LAI. V. ITO [1993] 203 I TR 456 (SC), THEIR LORDSHIPS HAVE HELD WHILE INTERPRETING SECTIO N 147 AS IT STOOD IN THE ASSESSMENT YEAR 1963-64:- . . AN INCOME-TAX OFFICER ACQUIRES JURISDICTION TO REOPEN AN ASSESSMENT UNDER SECTION 147(A) READ WITH SECTION 1 48 OF THE INCOME-TAX ACT, 1961, ONLY IF ON THE BASIS OF S PECIFIC, RELIABLE AND RELEVANT INFORMATION COMING TO HIS POS SESSION SUBSEQUENTLY, HE HAS REASONS, WHICH HE MUST RECORD, TO BELIEVE THAT, BY REASON OF OMISSION OR FAILURE ON T HE PART OF THE ASSESSEE TO MAKE A TRUE AND FULL DISCLOSURE OF ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT DURING THE 36 ITA NO.3768/DEL/2017 CONCLUDED ASSESSMENT PROCEEDINGS, ANY PART OF HIS I NCOME, PROFITS OR GAINS CHARGEABLE TO INCOME-TAX HAS ESCAP ED ASSESSMENT. HE MAY START REASSESSMENT PROCEEDINGS E ITHER BECAUSE SOME FRESH FACTS HAD COME TO LIGHT WHICH WE RE NOT PREVIOUSLY DISCLOSED OR SOME INFORMATION WITH REGAR D TO THE FACTS PREVIOUSLY DISCLOSED COMES INTO HIS POSSESSIO N WHICH TENDS TO EXPOSE THE UNTRUTHFULNESS OF THOSE FACTS. IN SUCH SITUATIONS, IT IS NOT A CASE OF MERE CHANGE OF OPIN ION OR THE DRAWING OF A DIFFERENT INFERENCE FROM THE SAME FACT S AS WERE EARLIER AVAILABLE BUT ACTING ON FRESH INFORMAT ION. SINCE THE BELIEF IS THAT OF THE INCOME-TAX OFFICER, THE S UFFICIENCY OF REASONS FOR FORMING THE BELIEF IS NOT FOR THE COURT TO JUDGE BUT IT IS OPEN TO AN ASSESSEE TO ESTABLISH THAT THE RE IN FACT EXISTED NO BELIEF OR THAT THE BELIEF WAS NOT A BONA FIDE ONE OR WAS BASED ON VAGUE, IRRELEVANT AND NON-SPECIFIC INFORMATION. TO THAT LIMITED EXTENT, THE COURT MAY LOOK INTO THE CONCLUSION ARRIVED AT BY THE INCOME- TAX OFFICE R AND EXAMINE WHETHER THERE WAS ANY MATERIAL AVAILABLE ON THE RECORD FROM WHICH THE REQUISITE BELIEF COULD BE FOR MED BY THE INCOME-TAX OFFICER AND FURTHER WHETHER THAT MAT ERIAL HAD ANY RATIONAL CONNECTION OR A LIVE LINK FOR THE FORMATION OF THE REQUISITE BELIEF. . . . (P. 477) 18. FOLLOWING THE SETTLED TREND OF JUDICIAL OPINION AND THE LAW LAID DOWN BY THEIR LORDSHIPS OF THE SUPREME COURT T IME AND AGAIN, DIFFERENT HIGH COURTS OF THE COUNTRY HAVE TA KEN THE VIEW THAT IF AN EXPENDITURE OR A DEDUCTION WAS WRONGLY A LLOWED WHILE COMPUTING THE TAXABLE INCOME OF THE ASSESSEE, THE S AME COULD NOT BE BROUGHT TO TAX BY REOPENING THE ASSESSMENT MEREL Y ON ACCOUNT OF SUBSEOUENTLV THE ASSESSING OFFICER FORMING AN OP INION THAT EARLIER HE HAD ERRED IN ALLOWING THE EXPENDITURE OR THE DEDUCTION - SIESTA STEEL CONSTRUCTION (P.) LTD. V. K.K. SHIKARE [1985] 154 ITR 547 (BOM.), SATPAL AUTOMOBILE CO. V. ITO [1983] 141 ITR 450 (ALL.), GOPAL FILMS V. ITO [1983] 139 ITR 566 (KAR.), CWT V . MANILAL C. DESAI [1973] 91 ITR 135 (MP). (UNDERLINING SUPPLIED) 20. ON APPLYING, THE ABOVE PRINCIPLES TO THE FACTS OF THE PRESENT CASE AND ON PERUSAL OF THE REASONS WE FIND THAT NO FRESH INFORMATION OR MATERIAL HAS BEEN REFERRED TO IN THE REASONS RECORDED FOR SEEKING TO REOPEN THE ASSESSMENT. THE MATERIAL THAT IS REFERRED TO IS THE VERY SAME MATERIAL THAT WAS A LREADY BEFORE THE ASSESSING OFFICER AT THE TIME OF FRAMING OF THE ASSESSMENT UNDER SECTION 143 (3) OF THE ACT AND EVEN THE REASO NS RECORD THAT 'FROM THE PERUSAL OF THE ASSESSMENT RECORD, IT IS O BSERVED THAT'. THIS CLEARLY SHOWS THAT THE ASSESSING OFFICER HAS S OUGHT TO RE- APPRECIATE THE MATERIAL THAT WAS ALREADY THERE AT T HE TIME WHEN 37 ITA NO.3768/DEL/2017 THE ASSESSMENT WAS FRAMED UNDER SECTION 143 (3). TH US, AS SEEN FROM ABOVE, IT IS CLEARLY A CASE OF CHANGE OF OPINI ON, WHICH IS CLEARLY NOT PERMISSIBLE. 5.18 THE HONBLE HIGH COURT HAS RELIED THE DECISION OF THE FULL BENCH OF HONBLE DELHI HIGH COURT IN THE CASE OF CI T VS USHA INTERNATIONAL LTD (SUPRA), WHEREIN THE HONBLE HIGH COURT HAS HELD THAT IN CASE IN ORIGINAL ASSESSMENT AN ISSUE O R QUERY HAS BEEN RAISED IN WHICH HAS BEEN ANSWERED BY THE ASSES SEE AND THEREAFTER THE ASSESSING OFFICER DOES NOT MAKE ANY ADDITION IN THE ASSESSMENT ORDER, IN SUCH SITUATION , HE FORMS AN O PINION AND THE THREE ASSESSMENT WILL BE INVALID ON THE GROUND OF CHANGE OF OPINION BECAUSE THE ASSESSING OFFICER AT FORMED TH E OPINION IN THE ORIGINAL ASSESSMENT ORDER. 5.19 ON DETAILED ANALYSIS OF THE DECISIONS CITED BY T HE REVENUE, WE FIND THAT IN THOSE DECISIONS IT IS HELD THAT IN VIEW OF THE AMENDMENT TO SECTION 147 OF THE ACT WITH EFFECT FRO M 01/04/1989, WHERE THE ORIGINAL ASSESSMENT IS COMPLE TED UNDER SECTION 143(3) OF THE ACT, THE REASSESSMENT WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR IS VALID EV EN IF THERE IS A TRUE AND FULL DISCLOSURE OF MATERIAL FACTS BY THE ASSESSEE IN THE ORIGINAL ASSESSMENT PROCEEDING. THE LEARNED COUNSEL , HOWEVER, OF THE VIEW THAT EVEN AFTER AMENDMENT TO SECTION 147 W .E.F. 01.04.1989, THE PRINCIPLE THAT MERELY ON CHANGE OF OPINION WITHOUT ANY FRESH MATERIAL THE ASSESSING OFFICER IS NOT PERMITTED TO REOPEN THE ASSESSMENT WITHIN FOUR YEARS FROM TH E END OF RELEVANT ASSESSMENT YEAR, IF THE SAME WAS COMPLETED U/S 143(3) OF THE ACT. THE ISSUE OF REOPENING OF REGULAR ASSES SMENTS FROM THE END OF THE RELEVANT ASSESSMENT YEAR HAS BEEN EXAMIN ED BY THE 38 ITA NO.3768/DEL/2017 HONBLE DELHI HIGH COURT (FULL BENCH) IN THE CASE O F KELVINATORS INDIA LTD. (SUPRA) , WHICH HAS BEEN FURTHER UPHELD BY THE HONBLE SUPREME COURT, IT IS HELD THAT WHERE THE ASSESSING OFFICER HAS APPLIED HIS MIND ON PARTICULAR ISSUE IN REGULAR ASS ESSMENT PROCEEDING, THE ASSESSMENT CANNOT BE REOPEN WITHIN THE PERIOD OF YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, MERELY ON THE CHANGE OF THE OPINION WITHOUT ANY TANGIBLE MATERIAL . 5.20 WE HAVE ALREADY DISCUSSED THE DECISIONS CITED BY THE LEARNED COUNSEL OF THE ASSESSEE WHEREIN THE HONBLE COURT HAS HELD CHANGE OF OPINION I.E. CENTURY TEXTILE INDUSTR IES LTD. (SUPRA), TULSI DEVELOPERS (SUPRA), HK BUILDCON LTD. (SUPRA), NITYNAND INFRASTRUCTURE LTD (SUPRA), REPLIKA PRESS PRIVATE L IMITED (SUPRA), RASALIKA TRADING AND INVESTMENT COMPANY PRIVATE LIM ITED (SUPRA). IN ALL THESE CASES, QUERIES WERE RAISED ON PARTICULAR ISSUE AND SAME WAS RESPONDED BY THE ASSESSEE IN THE ORIGI NAL ASSESSMENT PROCEEDING AND THE ASSESSMENT WAS REOPEN ED WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. 5.21 THE HONBLE DELHI HIGH COURT IN THE CASE OF USHA INTERNATIONAL LTD. (SUPRA), IN THEIR DECISION DATED 24/09/2012 BY A MAJORITY VIEW, HELD THAT WHEN ON A PARTICULAR ISSUE THE ASSESSING OFFICER HAS RAISED A QUERY AND THE ASSESS EE HAS RESPONDED IN REGULAR ASSESSMENT PROCEEDING, THEN IN SUCH CIRCUMSTANCES EVEN IF NO ADDITION HAS MADE IN THE A SSESSMENT ORDER, IT SHALL BE TREATED AS A OPINION HAS BEEN F RAMED BY THE ASSESSING OFFICER AND SUBSEQUENTLY, REOPENING ON TH E SAME ISSUE WOULD AMOUNT TO CHANGE OF OPINION. THE HONBLE HI GH COURT IN PARA 39 OF THE DECISION HAS FURTHER HELD THAT WHERE THE ASSESSING OFFICER HAS NOT RAISED ANY WRITTEN QUERY ON THE PAR TICULAR ISSUE IN 39 ITA NO.3768/DEL/2017 THE ORIGINAL ASSESSMENT, THEN SUCH MATTERS REQUIRE DEEPER SCRUTINY OR EXAMINATION OF THE RECORDS TO ENSURE WH ETHER ANY OPINION WAS FRAMED BY THE ASSESSING OFFICER ON THAT PARTICULAR ISSUE. THUS, THERE IS NO DOUBT THAT WHERE REGULAR A SSESSMENT IS COMPLETED UNDER SECTION 143 (3) OF THE ACT THE ASSE SSMENT CANNOT BE REOPENED WITHIN FOUR YEARS FROM THE END OF THE R ELEVANT ASSESSMENT YEAR MERELY ON THE BASIS OF CHANGE OF OP INION WITHOUT ANY TANGIBLE MATERIAL. 5.22 BEFORE US, THE LEARNED COUNSEL OF THE ASSESSEE HAS DRAWN OUR ATTENTION TO THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF MADHUKAR KHOSLA(SUPRA), WHEREIN IT IS HELD THAT FIRST OF ALL THE TRIGGER IN THE FORM OF NEW INFORMATION OR FACTS FOR ISSUANCE OF NOTICE OF RE-ASSESSMENT SHOULD BE SEEN AND THEN THE QUESTION WHETHER THE REOPENING OF THE ASSESSMENT AM OUNTS TO REVIEW OR CHANGE OF OPINION SHOULD BE SEEN AT A NEXT STAGE. 5.23 THIS TRIGGER OR CAUSE IS ONE OF THE BASIC R EQUIREMENT, WHICH NECESSARILY POSTULATES THAT THE ASSESSING OFF ICER IS SATISFIED TO ACT UNDER SECTION 147 READ WITH SECTION 148 AND, THEREFORE, HE MUST PUT IN WRITING AS WHY HE HOLDS THAT INCOME HAS ESCAPED ASSESSMENT. WHY FOR HOLDING SUCH BELIEF MUST BE R EFLECTED FROM THE REASONS RECORDED BY THE ASSESSING OFFICER. THE WORD REASON IN THE PHRASE REASON TO BELIEVE MEAN CAUSE OR JUS TIFICATION. IF THE ASSESSING OFFICER HAS CAUSE OR JUSTIFICATION TO THINK OR SUPPOSE THAT INCOME IS ESCAPED ASSESSMENT, HE CAN B E SAID TO HAVE REASON TO BELIEVE THAT SUCH INCOME HAS ESCAPED ASSESSMENT. UNDER THE PROVISIONS OF SECTION 147 OF THE ACT, THE AO HAS BEEN AUTHORIZED TO RE-ASSESS THE INCOME SUBJECT TO CONDI TION PROVIDED, BUT THE AO DOES NOT HAVE POWER TO REVIEW HIS OWN JU DGMENT. 40 ITA NO.3768/DEL/2017 5.24 IN THE INSTANT CASE BEFORE US, THE INFORMATION RE GARDING DUES FROM IRAQI GOVERNMENT WAS AVAILABLE AT THE TIM E OF REGULAR ASSESSMENT U/S 143(3) IN THE FORM OF NOTES TO ACCO UNT OF ANNUAL REPORT, WHICH IS EVIDENT FROM THE REASONS RECORDED, WHICH ARE REPRODUCED AS UNDER, FOR READY REFERENCE : THE ASSESSMENT 143(3) OF THE IT ACT, OF M/S. IRCO N INTERNATIONAL LTD. FOR THE ASSESSMENT YEAR 2009-10 WAS COMPLETED ON 30.12.2011 AT INCOME OF RS. 1,68,77,00,674/-. ON PE RUSAL OF THE RECORD, IT IS REVEALED THAT THE ASSESSEE COMPANY HA S TRANSLATED THE ACCRUED INTEREST ON DEFERRED IRAGI DUES AND PRO VISIONS FOR INTEREST TO SUB-CONTRACTORS AT EXCHANGE RATES PREVA LENT IN 1995 AND NOT TRANSLATED AT THE RATES PREVALENT ON 31.03. 09. DUE TO NON OBSERVING THE AFORESAID MANDATORY PROVISION OF TRAN SLATING THE FOREIGN EXCHANGE TRANSACTIONS, THE PROFIT OF THE AS SESSEE WERE LOWER BY RS. 6,90,40,000/-. BY DOING SO, THE ASSESS EE HAS REDUCED THE TOTAL INCOME TO THE EXTENT OF RS.6,90,4 0,000/- AND NOT DISCLOSED ITS INCOME TRULY TO THE EXTENT OF THE SAM E AMOUNT. BASED ON THE ABOVE FACTS, 1 HAVE REASON TO BELIEVE THAT THE INCOME OF THE ASSESSEE CHARGEABLE TO TAX TO THE EXT ENT OF RS.6,90,40,000/- HAS ESCAPED ASSESSMENT. 5.25 WHEN WE EXAMINE THE REASONS RECORDED BY THE ASSE SSING OFFICER IN THE INSTANT CASE IN THE LIGHT OF THE DEC ISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF MADHUKAR KHOSLA (SUPRA), IT IS EVIDENT THAT THE ASSESSING OFFICER H AS MERELY PERUSED THE RECORDS AVAILABLE WITH HIM AND FORMED R EASON TO BELIEVE THAT INCOME HAD ASSESSMENT. THERE IS NO MEN TION OF ANY TRIGGER AS HOW THE ASSESSING OFFICER CAME TO KNOW THIS UNDER ASSESSMENT. IF WITHOUT ANY INFORMATION OR ANY NEW F ACT CAME INTO HIS POSSESSION, HE SIMPLY REVISIT OR PERUSE THE COM PLETED ASSESSMENT, IT DEFINITELY AMOUNTS TO REVIEW OF THE ASSESSMENT BY THE ASSESSING OFFICER, WHICH IS NOT PERMITTED IN LA W. EVEN IN THE INSTANT CASE, NO ADDITION HAS BEEN MADE ON THIS ISS UE EITHER IN 41 ITA NO.3768/DEL/2017 THE EARLIER OR SUBSEQUENT REGULAR ASSESSMENTS. AS T HE REASSESSMENT IN THE INSTANT CASE FAILS AT THIS STAG E OF EXAMINING REASONS TO BELIEVE, WE ARE NOT REQUIRED TO EXAMIN E THE STAGE OF CHANGE OF OPINION. 6. IN VIEW OF THE ABOVE DISCUSSION, WE ARE OF THE OP INION THAT THERE IS NO INFIRMITY IN THE ORDER OF THE LD. CIT(A ) ON THE ISSUE-IN- DISPUTE, ACCORDINGLY, WE UPHOLD THE SAME. THE GROUN D OF THE APPEAL OF THE REVENUE IS DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS ACCORD INGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JANUARY, 2021. SD/- SD/- (AMIT SHUKLA) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 22 ND JANUARY, 2021. RK/- (D.T.D.S.) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI