IMPORTANT POINT
The concept of change of opinion is an in-built test to check abuse of power by the Assessing Officer. Reassessment proceedings initiated on the basis of a mere change of opinion are invalid and without jurisdiction.

JUDGMENT :

K. R. SHRIRAM, J.

1. Rule. Rule made returnable forthwith and heard. As the pleadings are completed, this court, by consent of the parties has taken up the matter for final hearing.

2. Petitioner, an individual, filed return of income on 28th August 2018 for AY-2018-19 declaring total income of Rs.26,26,220/-. Petitioner, thereafter, received a notice dated 28th September 2019 issued under Section 143(2) of the Income Tax Act 1961 (the Act) stating that return of income has been selected for limited scrutiny with regard to investments in immovable property, capital gains/income on sale of property. Petitioner was called upon to submit evidence with regard to the two issues raised.

Thereafter, petitioner received a notice dated 12th December 2019 issued under Section 142(1) of the Act calling upon petitioner to provide documents and details with regard to capital asset that was sold during the assessment year. Petitioner vide its Chartered Accountant's letter dated 11th December 2020, provided details of the property sold, consideration received, etc., the property being Flat No.802, 8th floor of Boulevard-III, Ghatkopar (West), Mumbai 400086 (the said flat). Later, petitioner received one more notice dated 16th February 2021 issued under Section 142(1) of the Act, seeking details with regard to same property. Once again, vide petitioner’s Chartered Accountant's letter dated 17th February 2021, petitioner provided all details and documents.

3. An assessment order came to be passed on 28th April 2021, in which, it is stated that the case was selected for limited scrutiny assessment on the issues relating to investments in immovable property, capital gains/income on sale of property and in view of material available on record, no addition on the issues is made. The assessment order also states that the assessment is passed accepting the income computed as per order under Section 143(1) of the Act.

4. Almost a year later, petitioner received a communication dated 11th March 2022 being an inquiry under Section 148A(a) of the Act seeking details of the sale of the residential property, which was the subject matter of the scrutiny assessment. Petitioner replied vide its Chartered Accountant's letter dated 15th March 2022 and provided all details and documents called for. This was followed by a notice dated 22nd March 2022 issued under Section 148A(b) of the Act, wherein paragraph 3 reads as under:

“3. On perusal of submission it is seen that you have purchased a residential property vide registered agreement dated 17.10.2017 and sold the said property vide registered agreement dated 27.10.2017 and thus the said immovable property is short term capital Asset and gain arising from the said sale of property is short terms capital Gain, however on perusal of computation of income it is seen that you have considered date of acquisition of property at 28.05.2010 and computed net long term capital loss of Rs.33,793/-. In view of the same, you are requested to explain as to why the capital gain on said sale of property should not be computed as under”

Sale consideration of flat (50% ownership) – Rs.1,05,00,000/-

Less :- Purchase consideration of flat (50% ownership) Rs.71,95,625/-

Short terms Capital Gain = 33,04,375/- taxable @ 30%.”

5. Petitioner replied to the said notice dated 22nd March 2022 objecting to the reopening vide petitioner’s Chartered Accountant's letter dated 28th March 2022. Notwithstanding, petitioner’s objections, the order dated 31st March 2022 under Section 148A(d) of the Act has been passed and notice also dated 31st March 2022 issued under Section 148 of the Act, holding that the asset sold was short term capital asset and gain arising on the transfer of such asset is short term capital gain. It is this order and the notice both dated 31st March 2022 which are impugned in this petition.

6. Various grounds have been raised but one ground is that there has been change of opinion. Mr. Gopal submitted that this court has