Section 148 Of The Income Tax Act, 1961 – In The High Court Of Judicature At Bombay

The I.T. department will notify any income tax calculation that has not been recalculated or evaluated. In this case, Petitioner challenges a notification issued under Section 148 of the Income Tax Act, 1961 (the Act) on 30th March 2021, asking to reopen the assessment for the fiscal year 2017-18, as well as an order issued on 22nd June 2021, dismissing Petitioner’s objections. K.R. SHRIRAM J pronounced this judgment on 19.01.2022 in PARINEE REALTY PVT. LTD. V. ASSISTANT COMMISSIONER OF INCOME TAX AND ORS.

It is intended that the reopening occurs within four years following the conclusion of the relevant evaluation year. Even though the provisions of Section 147 of the Act would not apply in this case, and the Assessing Officer would only have to determine the availability of tangible material, it is settled law that if the reopening is based on a mere change of opinion, the notice issued under Section 148 of the Act must be set aside. (Reserve Bank Officers Co-operative Credit Society Ltd. vs. The Income Tax Officer – 17(3)(1) and Ors.)

The Respondent’s Learned Counsel, Suresh Kumar, humbly submits that the assessment order lacks reference and explanation. These cannot be considered the subject of the Assessing Officer’s attention. The judge intends that  Mr. Suresh Kumar’s arguments be rejected because this court has repeatedly maintained that once a question is made during the assessment process. The assessee responds, the question raised becomes a matter of consideration by the Assessing Officer when completing the assessment. An evaluation order does not need to include a reference and/or discussion to reveal its satisfaction with the stated question.

The Learned Judge has taken into consideration the case Indian & Eastern Newspaper Society, New Delhi vs. Commissioner of Income Tax, New Delhi, and decided that even if the Assessing Officer made an error, an error revealed on a re-consideration of the same material does not give him the authority to reopen the case. When the essential facts required for assessment are fully and truthfully provided, the Assessing Officer cannot initiate reassessment procedures based on a change of opinion. Even though the Assessing Officer who issued the assessment order may have drawn too many legal conclusions from the information presented, the Assessing Officer who has opted to reopen assessment proceedings is ineligible to do so.

When the Assessing Officer has reached a definitive conclusion based on the evidence on file, it is impossible to reopen the assessment based on the same material to make a different decision. The petition is permissible in certain instances. The quashed and set aside notice dated 30th March 2021 issued under Section 148 of the Act and the ruling dated 22nd June 2021 dismissing Petitioner’s concerns.

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Reviewed by Rangasree


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