Point of Law: Taxation – Assessment/Re assessment - Concept of ‘change of opinion’ as an inbuilt test to check abuse of power by AO. It was further observed that AO has power to reopen assessment proceedings, provided there is tangible material to come to conclusion that there is escapement of income from assessment.

ORDER :

1. By filing this writ application, under Article 226 of the Constitution of India, the writ applicant seeks to challenge the impugned notice dated 31.03.2019 issued under Section 148 of the Income Tax Act, 1961 and assessment order dated 29.08.2019 at Annexure-N to this writ application.

2. Briefly stated the facts that, the writ applicant-assessee is an individual had earned long term capital gain of Rs. 1,86,51,572/- on sale of immovable property and while filing the return of income, same amount was claimed as exempt income under Section 54B of the Act, on account of purchase of new agriculture land for the AY 2012-13. She had filed her return of income on 06.07.2013 for the relevant year AY 2012-13 declaring her total income at Rs. 12,01,550/- whereby, she had claimed the exemption of Rs. 1,86,51,572/- under section 54B of the Act. The return of income was processed initially under Section 143(1) of the Act. The case of the assessee for the year under consideration was selected for scrutiny assessment. The notices under Section 143(2) and 142(1) of the Act dated 02.09.20214 and 07.11.2014 respectively, came to be issued and assessee was called for to furnish various details including the details with regard to claim of long term capital gain. The assessee furnished various details including the copy of registered sale deed and bank transactions with regard to purchase and sale of agriculture land to explain the exempt income of Rs. 1,86,51,572/-. During scrutiny proceedings, AO had taken into account the documentary evidence in the nature of sale deed etc. and allowed the long term capital gain to the extent of Rs. 1,85,00,000/- and made addition for the difference amount of Rs. 1,51,572/- to the total income of the assessee under the head of long term capital gain arising out of sale of immovable property. The assessment order was passed on 18.03.2015. The assessee had paid the tax on the difference amount.

3. Thereafter, the AO reopened the assessment by issuing impugned notice dated 31.03.2019 under Section 148 of the Act. After the impugned notice and in absence of income tax return, the notice under Section 142 (1) and 143(2) of the Act were issued on 21.08.2019. Accordingly to the case of the revenue, the assessee did not responded to the notices and thereafter, show cause notice dated 25.06.2019 was served to explain why the amount claimed as exempt amount under Section 54B of the Act, amounting to Rs. 1,85,00,000/- should not be added and/or disallow for the year under consideration and also called for necessary documentary evidence on or before 29.06.2019. In the show cause notice, the revenue supplied the copy of reasons recorded for the reopening. In response to the show cause notice, the assessee filed objections stating inter-alia that the reopening proceedings would nothing but mere a change of opinion as, earlier in the previous assessment proceedings, the issue of claim made under Section 54B of the Act was dealt with and decided in favour of the assessee. Therefore, the impugned notice as well as the subsequent proceedings are bad in law and in contravention of the provisions of Section 147 of the Act. However, the revenue passed an order vide dated 28.09.2019 of assessment under Section 143(3) of the Act, holding that the assessee failed to satisfy the condition of Section 54B of the Act and her claim of Rs. 1,85,00,000/- came to be disallowed and added to the total income of the assessee.

4. The assessee filed the present writ application on 03.09.2019 challenging the impugned notice as well as the assessment order, wherein, this Court issued notice on 05.09.2019 and granted adinterim relief restraining the respondent revenue from proceedings further pursuant to the impugned notice. The order dated 10.10.2019 passed by this Court, reads as under:

“1. Mr. Tushar Hemani, Senior Advocate, learned counsel with Ms. Vaibhavi Parikh, learned advocate for the petitioner submitted that in this case the object