JUDGMENT

Sanjiv Khanna, J.

1. By order dated 23rd April, 2012 in ITA No. 2026/2010, Commissioner of Income Tax - VI, New Delhi vs. Usha International Limited, the following substantial questions of law have been referred to this Full Bench:

"(i) What is meant by the term "change of opinion?

(ii) Whether assessment proceedings can be validly reopened under Section 147 of the Act, even within four year, if an assessee has furnished full and true particulars at the time of original assessment with reference to income alleged to have escaped assessment and whether and when in such cases reopening is valid or invalid on the ground of change of opinion?

(iii) Whether the bar or prohibition under the principle "change of opinion" will apply even when the Assessing Officer has not asked any question or query with respect to an entry/note, but there is evidence and material to show that the Assessing Officer had raised queries and questions on other aspects?

(iv) Whether and in what circumstances Section 114 (e) of the Evidence Act can be applied and it can be held that it is a case of change of opinion?"

2. We need not refer to the factual matrix relating to ITA 2026/2010 (supra) but are only required to note that the aforesaid questions relate to interpretation of Section 147 of the Income Tax Act, 1961 (Act, for short) as amended w.e.f. 1st April, 1989. We record that the questions of law require elucidation in view of contentions raised regarding observations made by the Bench of three Judges of this Court in CIT vs. Kelvinator of India Limited, (2002) 256 ITR 1 (Del - FB). Revenue had filed an appeal against the said decision but the Supreme Court dismissed the appeal of the Revenue in a decision which is reported as CIT vs. Kelvinator of India Ltd. (2010) 2 SCC 723. Conflicting views expressed on the question of "change of opinion" have been noticed below.

3. As Section 147 of the Act is required to be interpreted and examined we deem it appropriate to reproduce the said Section as it exists:

"147. Income escaping assessment.--If the Assessing Officer, has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year):

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 this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment for that assessment year.

Explanation 1.--Production before the Assessing officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing officer will not necessarily amount to disclosure within the meaning of the foregoing proviso.

Explanation 2.--For the purposes of this section, the following shall also be deemed to be cases where income chargeable to tax has escaped assessment, namely:- (a) where no return of income has been furnished by the assessee although his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeabl