( 1 ) ALTHOUGH it is an application under Section 256 (2) of the Income-tax Act, 1961 (in short the act ) seeking a direction to the Income-tax Appellate Tribunal (for short the tribunal ) to refer the question set out therein for the opinion of this Court but in view of the tribunal and the question raised is a pure question or Law, we dispense with a formal statement of facts; treat the petition as a regular reference and proceed to answer the question proposed.

( 2 ) THE question posed for consideration of this larger Bench is, as to whether even for a mere change of opinion by the Income-tax Officer (in short ito ) action under Section 147 of the Income-tax Act, 1961 can be brought into operation.

( 3 ) WITH a view to advert to the said question, the factual matrix bereft of all unnecessary details may be noticed:-

( 4 ) THE assessment year under reference is 1987-88. The relevant previous year is 1/07/1985 to 30/06/1986. The assessee maintained guest houses in Delhi, bombay and Faridabad, wherefor it incurred the following expenses:

PARTICULARS Amount (Rs.) 1. Rent Rs. 1,76,000. 00 2. Expenses Rs. 91,485. 00 Rs. 2,67,485. 00 3. Depreciation Rs. 66. 441. 00 Rs. 3,33,926. 00

( 5 ) A return of income declaring income of rs. 1,62,8907/- was filed on 29/06/1987 by the assessee wherewith computation of income, annual report, tax audit report, etc. were also filed. As it did not claim deduction for the expenses as enumerated hereinbefore, a revised return was filed on 5/10/1989 along with a letter of the same date, wherein it was contended that rent for a sum of Rs. 1,76,000. 00; and depreciation for a sum of rs. 66,441/- should be allowed in terms of Sections 30 and 32 of the Act. The said contention was raised relying on or on the basis of a decision of the Bombay High Court in commissioner of Income-tax vs. Chase Bright Steel Ltd. (No. 1) (1989) 177 ITR 124. Disallowance under Section 37 (4) of the Act in respect of the Guest houses was restricted to maintenance expenses of Rs. 91,485. 00. An order of assessment was passed by the Assessing Officer on 17/11/1989, wherein upon making additions and disallowances the taxable income was determined at Rs. 21,14,082. 00. A claim of rs. 91,485/- was disallowed in respect of the above accommodations as submitted in the revised computation.

( 6 ) SUBSEQUENTLY, a notice under Section 148 of the act was issued on 20/04/1990 for reopening of the assessment in terms of Section 147 thereof. The reasons recorded for reopening the assessment are: "m/s. Kelvinator of India Ltd. Assessment year 1987-88. Assessment was completed u/s. l43 (3) on 12. 11. 89 on Income of Rs. 6,34,225. 00. The perusal of the record shows that the assessee maintains the books on mercantile basis. In the year under consideration, the assessee claimed interest of Rs. 41. 28 lacs which in fact pertains to the earlier assessment years (Sec 140b p (c-3) page 21 of printed balance sheet ). This was not allowable expenditure In this year. Further, Tax Audit Report shows that following items were disallowable : disallowable Disallowed Less Disallowable 1. Guest House Exp. 2,67,485/- 91,485/- 1,76,000/- 2. Under rule 6b 1,74,098/- 90,795/- 83,303/- 3. Club Expenditure 5,329/- 1,029/- 4,300/- total 2,63,603/- total under assessment is to the tune of rs. 43,91,603/ -. The case Is covered u/s. 147. Notice u/s. 148 is issued. "

( 7 ) THE assessee objected to the said reopening of the assessment. However an order of re-assessment was passed on 24/09/1990 determining the total income at Rs. 23,56,523. 00, whereby a sum of rs. 2,42,441/- (rent of Rs. 1,76,000. 00 and depreciation of rs. 66,441/-) incurred on the maintenance of guest houses was disallowed and added to the total income. Though the assessment was re-opened on the alleged ground of various disallowable claims but except for the aforenoted disallowance, neither any other claim was disallowed nor any addition was made. In support of his order of re-assessment th