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ITA 4838/DEL/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74326 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 30-12-2013
• Assessment Year: 2003-2004
• Appeal Filed On: 03-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V MOHAN
• Assessee Lawyers: SAMEER SHARMA
• Keywords: Search and seizure; Question of law; Tangible material; Difference of opinion; Assessment record; Reason to believe; Change of opinion
• Section: 143(3); 147; 148

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H: NEW DELHI BEFORE SHRI J. S REDDY, ACCOUNTANT MEMBER AND SHRI A. T. VARKEY, JUDICIAL MEMBER ITA NO. 4838 /DEL/ 2011 (ASSESSMENT YEAR: 2003 - 04) ITO, WARD - 18(3), ROOM NO. 248, C.R. BUILDING, NEW DELHI VS. WEST DELHI CABLE NETWORK PVT. LTD., B - 10, LAWRANCE ROAD, NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY : VED JAIN, CA & V. MOHAN, RESPONDENT BY: SAMEER SHARMA, SR. DR O R D E R PER A. T. VARKEY , JUDICIAL MEMBER THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LD CIT(A) - XXI , NEW DELHI DATED 17.08.2011 FOR THE ASSESSMENT YEAR 2003 - 04 . 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS E RRED IN QUASHING THE ASSESSMENT ORDER PASSED U/S 147/ 143(3) AS BEING WITHOUT THE AUTHORITY OF LAW. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) HAS ERRED IN ALLOWING APPEAL OF THE ASSESSEE REGARDING THE DISALLOWANCE OF RS. 30,00,000/ - ON ACCOUNT OF REBATE AND DISCOUNT PAID TO SUBSCRIBERS AND FRANCHISES IN LIMINE, WITHOUT DISCUSSI NG THE MERITS OF THIS DISALLOWANCE DISCUSSED IN THE ASSESSMENT ORDER. 3. ON THE FACTS AND CIRCUMSTANCES OF THE AND IN LAW THE LD CIT(A) HAS ERRED IN ALLOWING APPEAL OF THE ASSESSEE ON THE POINT OF INCLUSION OF INCOME OF RS. 16,09,952/ - ON ACCOUNT OF REBAT E AND DISCOUNT NOT SHOWN AS INCOME AND CREDITED IN ITS BOOKS, IN LIMINE, WITHOUT DISCUSSING THE MERITS OF THIS DISALLOWANCE DISCUSSED IN THE ASSESSMENT ORDER. 4. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIGHT TO AMEND, MODIFY, ALTER ADD OR FOREGO ANY GROUNDS(S) OF APPEAL AT ANY TIME BEFORE FOR DURING THE HEARING OF APPEAL. 3. APROPOS GROUND NO. 1, WHE THER THE QUASHING OF THE ASSESSMENT ORDER PASSED U/S 147/143(3) BY THE LD CIT(A) IS VALID OR NOT. PAGE NO. 2 4. BRIEF FACTS OF THE CASE IS THAT THE ASSESSEE IS IN THE BUSINESS OF PROVIDING CABLE NETWORK TO THE CUSTOMERS. THE ASSESSEE COMPANY HAS FILED ITS ORIGINAL RETURN OF INCOME FOR THE ASSESSMENT YEAR 2003 - 04 DECLARING LOSS OF RS. 17,50,680/ - VIDE RETURN DATED 02.12.2003 , THE RETURN ED WAS ASSESSED U/S 143(1) OF THE INCOME TAX ACT 1961 (HEREINAFTER THE ACT) AT THE RETURN LOSS OF RS. 17,50,680/ - . FURTHER ON 25.04.2005 THE ASSESSING OFFICER ISSUED NOTICED U/S 148 OF THE ACT AND THE SCRUTINY ASSESSMENT U/S 143(3) READ WITH SECTION 147 OF THE ACT WAS COMPLETED ASSES SING THE LOSS AT RS. 9,64,660/ - . 5. SUBSEQUENTLY , AGAIN THE CASE WAS SELECTED FOR REASSESSMENT BY ISSUING NOTICE U/S 148 ON 30.07.2008 AND THE ASSESSMENT U/S 147/ 143(3) OF THE ACT WAS AGAIN COMPLETED ON 29.12.2009 , ASSESSING THE INCOME OF RS. 36,45,292/ - BY MAKING AN ADDITION OF RS. 46,09,952/ - ON ACCOUNT OF REBATE AND DISCOUNT . 6. AGGRIEVED BY THE SAID ADDITION MADE BY THE ASSESSING OFFICER AFTER THE REASSESSMENT THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD CIT( A) WHO VIDE ORDER DATED 17.08.2011 QUASHED THE REASSESSMENT ORDER PASSED U/S 147 HOLDING THAT THE SAID IMPUGNED ORDER WAS WITHOUT AUTHORITY OF LAW AND THE REASSESSMENT ORDER WAS QUASHED AND SO HE DID NOT ENTER INTO THE MERITS OF THE MATTER HOLDING THE SAM E TO BE INFRUCTUOUS. 7. AGGRIEVED BY THE SAID ORDER OF THE LD CIT(A) THE REVENUE IS BEFORE US. 8. LD DR ASSAILED THE DECISION OF THE LD CIT(A) AND SUBMITTED THAT THE LD CIT(A) DID NOT LOOK INTO THE MERITS OF THE CASE , WHEREIN THE RELEVANT ASSESSMENT YEAR INADMISSIBLE EXPENSES HAVE BEEN ALLOWED, WHICH IS NOT PERMISSIBLE IN LAW AND THE MISTAKE HAD RESULTED IN AN UNDER ASSESSMENT OF INCOME TO THE TUNE OF RS. 30,00,000/ - AND AN AMOUNT OF RS. 16,09,952/ - ALSO ESCAPED ASSESSMENT. 9. THEREFORE, THE ASSESSING OFFICER REASSESSED THE CASE OF THE ASSESSEE AS PER LAW AND IT IS VALID IN THE EYES OF LAW. ON THE OTHER HAND THE LD AR , FIRST OF ALL, POINTED OUT THAT IN THE AOS ORDER THE ASSESSMENT YEAR IS SHOWN AS 2004 - 05, HOWEV ER HE CONTENDS THAT IT IS A TYPOGRAPHICAL ERROR AND THE CORRECT ASSESSMENT YEAR IS 2003 - 04 AND THOUGH THE SAID FACT WAS BROUGHT TO THE NOTICE OF THE LD CIT(A), INADVERTENTLY THE MISTAKE HAS NOT BEEN CORRECTED IN THE CIT(A )S ORDER ALSO.AFTER POINTING OUT THIS MISTAKE, T HE LD AR ASSAILED THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT THE ASSESSING OFFICER COULD NOT HAVE REOPENED THE PAGE NO. 3 ASSESSMENT ORDER AFTER A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEARS DESPITE THE FACT THAT T HE ORIGINAL ASSESSMENT WAS DONE U/S 143(3) REA D WITH SECTION 147 OF THE ACT. THE LD AR ASSAILED THE ACTION OF THE ASSESSING OFFICER ON TWO COUNTS, FIRSTLY, THE ASSESSING OFFICER IS NOT ENTITLED TO REVIEW ITS OWN ORDER PASSED EARLIER ; SECONDLY THE REOPENING IS BARRED BY LIMITATION OF FOUR YEARS , WHEN ORIGINAL A SSESSMENT HAS BEEN DONE U/S 143(3) READ WITH SECTION 147 OF THE ACT UNLESS, THERE WAS DELIBERATE ACTION ON THE PART OF THE ASSESSEE NOT TO HAVE DISCLOSE D FULLY AND TRULY ALL THE MATERIAL FACTS NECESSAR Y FOR ASSESSMENT. AND SINCE THE ASSESSEE HAD DISCLOSED ALL THE FACTS IN THE EARLIER PROCEEDINGS AND ADMITTEDLY THERE WAS NO NEW MATERIAL IN THE HANDS O F THE AO, THE REOPENING OF THE ASSESSMENT AT BEST CAN BE SAID TO BE A CHANGE OF OPINION, AND MERE CHANGE OF OPINION CANNOT BE THE BASIS OF REOPENING AN ASSESSMENT WHICH WAS COMPLETED U/S 143(3) READ WITH 147 OF THE ACT AND THEREFORE, A CCORDING TO THE LD AR, THE LD CIT(A) HAS RIGHTLY QUASHED THE IMPUGNED ASSESSMENT ORDER AND THE ORDER OF THE LD CIT(A) DOES NOT REQUIRE ANY INTERFERENCE. 11 . WE HAVE HEARD THE RIVAL SUBMISSION AND HAVE CAREFULLY PERUSED THE RECORD AND HAVE ALSO GONE THROUGH THE CASE LAWS CITED BY EITHER SIDE . THE ISSUE WHICH TRIGGERED THE ASSESSING OFFICER TO REOPE N THE CASE WAS THAT WHEN HE GLA NCED THROUGH THE ASSESSMENT RECORDS HE FOUND THAT FOR A.Y. 2003 - 04, THE ASSESSEE WAS ALLOWED AN EXPENDITURE OF RS. 30,00 0000/ - ON ACCOUNT OF REBATE AND DISCOUNT PAID TO THE SUBSCRIBERS AND FRANCHISE OF CITY CABLE NETWORK ; AND AS PER LEDGER ACCOUNT, THE ASSESSEE HAS RECEIVED AN AMOUNT OF RS. 16,09,952/ - ON ACCOUNT OF REBATE AND DISCOUNT FROM M/S SITI CABLE NETWORK PVT. LTD , WHICH WAS NOT CREDITED AS INCOME IN THE ACCOUNTS OF THE ASSESSEE AND IT NEED TO BE ADDED BACK . FROM THE SAID REASONING STATED IN THE ASSESSING ORDER, TO REOPEN THE ASSESSMENT, WE CAN SAFELY PRESUME THAT THERE WAS NO ADVERSE MATERIAL OR ANY NEW INFORMATION WAS THERE BEFORE THE ASSESSING OFFICER , OTHER THAN THE ASSESSMENT RECORDS WHICH PROMPTED HIM TO REOPEN THE CASE OF THE ASSESSEE. THE ISSUE OF ALLOWANCE OF REBATE AND DISCOUNT AND THE LEDGE R ACCOUNT OF SITI CABLE NETWORK LTD WERE ALL BEFORE THE PREDECESSOR ASSESSING OFFICER, WHO HAD CONDUCTED SCRUTINY ASSESSMENT U/S 143 & 147 IN THE YEAR 2006 FOR THE VERY SAME ASSESSMENT YEAR. NOW LET US TAKE NOTE OF THE ISSUES WHICH WERE EXAMINED IN PAGE NO. 4 DETAIL BY THE PREDECESSOR OF THE ASSE SSING OFFICER WHEN HE DID THE SCRUTINY THE ASSESSMENT AND PASSED ASSESSMENT ORDER U/S 143(3) AND 147 ON 24.11.2006. I. REBATE AND DISCOUNT OF RS. 33,23188/ - WERE DULY SHOWN IN THE P&L ACCOUNT (PB PG 12) ; II. COPIES OF AGREEMENT WITH CABLE OPERATORS (PB PG 45 ONWARDS.) ; III. LEDGER A/C OF SITI CABLE NETWORK LTD. (PB PG 61) ; IV. DETAILS OF ALL EXPENSES AS PER LETTER DATED 04.10.2005 (PB PG 89 - 90) ; V. AGREEMENT WITH DISTRIBUTORS/COLLECTION AGENT (PG PG 189); VI. COPY OF LEDGER A/C OF SITI CABLE NETWORK VIDE LETTER DATED 27.01.2006(PB PG 192) ; VII. THE ASSESSING OFFICER HAS SPECIFICALLY ASKED A QUERY ON THE ALLOWABILITY OF R EBATES & DISCOUNTS AS PER IS QUESTIONNAIRE DATED 04.10.2006 (PB PG 232); VIII. THE ASSESSEE GAVE A SPECIFIC REPLY VIDE LETTER DATED 10.11.2006 (PB PG 282) ; IX. AFTER DETAILED DISCUSSIONS ON ALL THE ABOVE ISSUES THE ASSESSING OFFICER PASSED THE ORDER U/S 14 3(3) READ WITH SECTION 24.11.2006 (PB PG 284) ; X. THE ASSESSING OFFICER HAS SPECIFICALLY MADE MENTION OF THESE ISSUES IN HIS ORDER PG 2(PB PG 286) PARA 11. 12. THE AFORESAID DOCUMENTS WERE EXAMINED IN DETAIL AT THE TIME OF COMPLETION OF ORIGINAL ASSESSMENT BY THE THEN ASSESSING OFFICER WHO HAD SOUGHT ALL THE RELEVANT INFORMATION/ CLARIFICATION FROM THE ASSESSEE COMPANY AND THERE AFTER APPLYING HIS MIND THE SAID ASSESSING OFFICER TOOK THE DECISION TO DELETE RS. 33,23,188 / - ON ACCOUNT OF REBATE AND DISCOUNT IN ITS ORDER 24.01.2006 PASSED U/S 143(3)/147 OF THE ACT. 13. SINCE ALL THE FACTS WERE BROUGHT BEFORE THE ASSESSING OFFICER DURING THE OR I GINAL SCRUTINY ASSESSMENT AS EARLY AS OF THE YEAR 2006, IT IS CLEAR THAT THE ASS ESSEE HAD DISCLOSED ALL MATERIAL FACTS TRULY AND FULLY AND THE SAID ASSESSMENT CANNOT BE DISPUTED AFTER A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR ON MERE CHANGE OF OPINION . WE FIND FORCE IN THE ARGUMENT OF THE LD AR THAT THE ACTIO N OF ASSESSING OFFICER U/S 148 PROCEEDINGS TANTAMOUNT TO REVIEW OF THE ORDER PASSED BY HIS PREDECESSOR AND IT CAN ONLY BE TERMED AS CHANGE OF OPINION. THE DELHI HIGH COURT IN THE CASE OF CIT VS. ORIENT CRAFT LTD 354 ITR 536 (DEL) HELD AS UNDER: - THERE WAS NO FRESH MATERIAL WHICH CAME TO THE NOTICE OF THE ASSESSING OFFICER AFTER THE ORIGINAL RETURN WAS PROCESSED UNDER SECTION 143(1) AND HAVING REGARD TO THE ORDERS OF THE TRIBUNAL (SUPRA) AND THE INSTRUCTION OF THE CBDT DATED 23 RD FEBRUARY, 1998 REGARDING TH E TREATMENT TO BE GIVEN PAGE NO. 5 TO THE PREMIUM RECEIVED ON TRANSFER OF QUOTAS, THERE WAS NO ESCAPEMENT OF INCOME AND THUS THE NOTICE WAS WITHOUT JURISDICTION. AS DECIDED IN CIT VS. KELVINATOR OF INDIA LTD.[2010 (1) TMI 11 - SUPREME COURT OF INDIA] AO HAS NO POWER TO REVIEW, HE HAS THE POWER TO REASSESS. BUT REASSESSMENT HAS TO BE BASED ON FULFILLMENT OF CERTAIN PRECONDITIONS AND IF THE CONCEPT OF 'CHANGE OF OPIN ION' 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 ASSESSING OFFICER. THE R EASONS TO BELIEVE MUST HAVE A MATERIAL BEARING ON THE QUESTION ON ESCAPEMENT OF INCOME. IT DOES NOT MEAN A PURELY SUBJECTIVE SATISFACTION OF THE ASSESSING AUTHORITY; THE REASON BE HELD IN GOOD FAITH AND CANNOT MERELY BE A PRETENCE. THE REASONS DISCLOSE TH AT THE AO REACHED THE BELIEF THAT THERE WAS ESCAPEMENT OF INCOME 'ON GOING THROUGH THE RETURN OF INCOME' FILED BY THE ASSESSEE AFTER HE ACCEPTED THE RETURN UNDER SECTION 143(1) WITHOUT SCRUTINY, AND NOTHING MORE. THIS IS NOTHING BUT A REVIEW OF THE EARLIER PROCEEDINGS AND AN ABUSE OF POWER BY THE AO BOTH STRONGLY DEPRECATED BY THE SUPREME COURT IN CIT VS. KELVINATOR (SUPRA). THE REASONS RECORDED BY THE AO IN THE PRESENT CASE DO CONFIRM APPREHENSION ABOUT THE HARM THAT A LESS STRICT INTERPRETATION OF THE WOR DS 'REASON TO BELIEVE' VIS - A - VIS AN INTIMATION ISSUED UNDER SECTION 143(1) CAN CAUSE TO THE TAX REGIME. THERE IS NO WHISPER IN THE REASONS RECORDED, OF ANY TANGIBLE MATERIAL WHICH CAME TO THE POSSESSION OF THE ASSESSING OFFICER SUBSEQUENT TO THE ISSUE OF T HE INTIMATION. IT REFLECTS AN ARBITRARY EXERCISE OF THE POWER CONFERRED UNDER SECTION 147 - SUBSTANTIAL QUESTION OF LAW ANSWERED IN FAVOUR OF THE ASSESSEE.' 14. AND THE JUDGMENT OF HONBLE DELHI HIGH COURT WAS APPROVED BY THE SUPREME COURT IN THE CASE OF CIT VS. KELVINATOR OF INDIA LTD. (2010) 320 ITR 561 (SC) WHEREIN THE APEX COURT HELD AS UNDER: - ' ONE NEEDS TO GIVE A SCHEMATIC INTERPRETATION TO THE WORDS 'REASON TO BELIEVE' FAILING WHICH, WE ARE AFRAID, SECTION 147 WOULD GIVE ARBITRARY POWERS TO THE ASS ESSING OFFICER TO RE - OPEN ASSESSMENTS ON THE BASIS OF 'MERE CHANGE OF OPINION', WHICH CANNOT BE PER SE REASON TO RE - OPEN. WE MUST ALSO KEEP IN MIND THE CONCEPTUAL DIFFERENCE BETWEEN POWER TO REVIEW AND POWER TO RE - ASSESS. THE ASSESSING OFFICER HAS NO POWER TO REVIEW; HE HAS THE POWER TO RE - ASSESS. BUT RE - ASSESSMENT HAS TO BE BASED ON FULFILLMENT OF CERTAIN PRE - CONDITION AND IF THE CONCEPT OF 'CHANGE OF OPINION' IS REMOVED, AS CONTENDED ON BEHALF OF THE DEPARTMENT, THEN, IN THE GARB OF RE - OPENING THE ASSESSM ENT, 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 ASSESSING OFFICER. HENCE, AFTER 1ST APRIL, 1989, ASSESSING OFFICER HAS POWER TO RE - OPEN, PROVIDED THERE IS 'TANGIBLE MATERIAL ' TO COME TO THE CONCLUSION THAT THERE IS ESCAPEMENT OF INCOME PAGE NO. 6 FROM ASSESSMENT. REASONS MUST HAVE A LIVE LINK WITH THE FORMATION OF THE BELIEF. OUR VIEW GETS SUPPORT FROM THE CHANGES MADE TO SECTION 147 OF THE ACT, AS QUOTED HEREINABOVE. UNDER THE DIRECT T AX LAWS (AMENDMENT) ACT, 1987, PARLIAMENT NOT ONLY DELETED THE WORDS 'REASON TO BELIEVE' BUT ALSO INSERTED THE WORD 'OPINION' IN SECTION 147 OF THE ACT. HOWEVER, ON RECEIPT OF REPRESENTATIONS FROM THE COMPANIES AGAINST OMISSION OF THE WORDS 'REASON TO BELI EVE', PARLIAMENT RE - INTRODUCED THE SAID EXPRESSION AND DELETED THE WORD 'OPINION' ON THE GROUND THAT IT WOULD VEST ARBITRARY POWERS IN THE ASSESSING OFFICER. WE QUOTE HEREINBELOW THE RELEVANT PORTION OF CIRCULAR NO.549 DATED 31ST OCTOBER, 1989, WHICH READS AS FOLLOWS: '7.2 AMENDMENT MADE BY THE AMENDING ACT, 1989, TO REINTRODUCE THE EXPRESSION REASON TO BELIEVE' IN SECTION 147. - A NUMBER OF REPRESENTATIONS WERE RECEIVED AGAINST THE OMISSION OF THE WORDS REASON TO BELIEVE' FROM SECTION 147 AND THEIR SUBSTITU TION BY THE OPINION' OF THE ASSESSING OFFICER. IT WAS 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 SECTION 147 WOULD GIVE ARBITRARY POWERS TO THE ASSESSING OFFICER TO REOPEN PAST ASSESSMENTS ON MERE CHANGE OF OPINION. TO ALLAY THESE FEARS, THE AMENDING ACT, 1989, HAS AGAIN AMENDED SECTION 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 SECTION 147, HOWEVER, REMAIN THE SAME. ' FOR THE AFORE - STATED REASONS, WE SEE NO MERIT IN THESE CIVIL APPEALS FILED BY THE DEPARTMENT, HENCE, DISMISSED WITH NO ORDER AS TO COSTS . ' 15. IN THE IMPUGNED ORDER BEFORE US, THE LD CIT(A) HAS HELD AS FOLLOWS: - 3.5 IT IS ALSO PERTINENT TO MENTION THAT IN THE INSTANCE CASE BEFORE THE REASSESSMENT ORDER IN QUESTION (WHICH IS IN APPEAL BEFORE THE UNDERSIGNED), THE ASSESSMENT HAS BEEN COMPLETED ON SIMILAR SET OF FACTS U/S 143(3)/147 VIDE ORDER DATED 24.11.2006. THEN AGAIN REOPENING HAS BEEN DONE AND ANOTHER ORDER HAS BEEN PASSED AS ON 29.12.2006. THEN AGAIN REOPENING HAS BEEN DONE AND ANOTHER ORDER HAS BEEN PASSED AS ON 29.12.2009 VIDE ORDER U/S 147 READ WITH SECTION 143(3) OF THE IT ACT. THUS, IN VIEW OF THE AFOREMENTIONED JUDGMENT AND AS WELL AS THE JUDGMENTS RELIED UPON BY THE APPELLANT, CLEAR POSITION OF LAW AND FACTS OF THE CASE, I AM OF THE CONSIDERED VIEW THAT THERE WAS NO GROUND TO BELIEVE THAT THERE WAS ANY ESCAPEMENT OF INCOME. IT IS ALSO OBSERVED THAT THE ASSESSING OFFICER HAS NOT SHOWN ANYWHERE IN THE REASONS THAT HOW AND IN WHAT MANNER THE ASSESSEE COMPANY FAILED IN DISCLOSING ALL MATERIALS FACTS FULLY AND TRULY. THEREFORE IT IS HELD THAT THE REASSESSMENT ORDER PASSED U/S 147 IS WITHOUT THE AUTHORITY OF LAW AND SAME IS HEREBY QUASHED. AS REASSESSMENT ORDER HAS BEEN QUASHED, GROUNDS NO. 1,2 AND 3 ARE ALLOWED IN FAVOUR OF THE APPELLANT. PAGE NO. 7 16. FROM A PERUSAL OF THE RECORDS WE FIND THAT THE ASSESSING OFFICER HAS ERRED IN ASSUMING JURISDICTION WITHOUT BRINGING IN ANY NEW MATERIAL ADVERSE AGAINST THE ASSESSEE TO INITIATE PROCEEDING U/S 147 OF THE ACT AND NEITHER THERE WAS ANY GROUND TO BELIEVE THAT THERE WAS ANY ESCAPEMENT OF INCOME NOR HE HAS BEEN ABLE TO SHOW THAT THE ASSESSEE HAS NOT DISCLOSED ALL MATERIAL FACTS FULLY AND TRULY. THE IMPUGNED ORDER OF THE ASSESSING OFFICER WAS AN EXERCISE UNDERTAKEN BY HIM ON A MERE CHANGE OF OPINION AND IT IS NOT PERM ISSIBLE IN LAW. THEREFORE, IT HAS BEEN RIGHTLY HELD BY LD CIT(A) THAT THE REASSESSMENT ORDER PASSED U/S 147 IS WITHOUT AUTHORITY OF LAW AND QUASHED IT. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE REASONED ORDER PASSED BY THE LD CIT(A), THEREFORE IN THE RESULT THE APPEAL IS DEVOID OF MERITS AND THEREFORE, THE APPEAL OF THE REVENUE FAILS AND THE LD CIT(A)S ORDER IS CONFIRMED. 17. ADJUDICATION OF GROUND NO. 2 & 3 AFTER OUR DECISION IN GROUND NO. 1 WILL BE MERELY AN ACADEMIC EXERCISE AND WE ARE NOT PERSUA DED TO DO SO AND THEREFORE BOTH THE GROUNDS ARE DISMISSED. 18. I N THE RESULT THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 . 03 .2014. - SD/ - - SD/ - ( J. S REDDY) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :14 / 02 / 2014 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI