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BHARGAV D. KARIA, NIRAL R. MEHTA
Deepak Natvarlal Pankhiyani (HUF) – Appellant
Versus
Assistant Commissioner Of Income Tax Circle 3(1)(1) – Respondent
JUDGMENT :
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. Heard learned advocate Mr. B.S.Soparkar for the petitioner and learned Senior Standing Counsel Mr. Karan Sanghani for learned advocate Mrs. Kalpana K Raval for the respondent.
2. Rule returnable forthwith. Learned Senior Standing Counsel Mr. Karan Sanghani waives service of notice of rule for the respondents.
3. Having regard to the controversy in the narrow compass, with the consent of the learned advocates for the parties, the matter is taken up for hearing.
4. By this petition under Article 226 of the Constitution of India, the petitioner has prayed for quashing and setting aside the notice dated 27.03.2021 issued under section 148 of the Income Tax Act,1961 [for short ‘the Act’] as well as the impugned order dated 10.01.2022 rejecting the objection filed by the petitioner.
5. Brief facts as stated in the memo of the application are as under:
5.1 The petitioner is engaged in the business of trading in shares and security. The petitioner filed its original return of income for AY 2015-16 on 21.09.2015 declaring total loss of Rs. 2,00,23,842/-.
5.2 The case of the petitioner was selected for limited scrutiny by issuing notice u
Reopening of assessments under the Income Tax Act requires fresh tangible material; reliance on previously examined information constitutes a change of opinion and is invalid.
The court emphasized that vague reasons for reopening an assessment do not satisfy the legal requirement for establishing income escapement under Section 148.
The court held that an Assessing Officer must form an independent opinion based on material on record before reopening an assessment, and cannot solely rely on external information.
Reopening of assessment under section 148 requires new tangible material; reliance on previously considered facts constitutes a change of opinion, which is impermissible.
The main legal point established is that the Assessing Officer's belief for the reassessment of income under section 148 of the Income Tax Act is based on subjective satisfaction and the existence of....
The reopening of an assessment under the Income Tax Act requires the Assessing Officer to provide specific reasons linking alleged income escapement to the taxpayer's records, which must not solely r....
Reopening of income tax assessments requires new tangible material; mere change of opinion is insufficient.
Reopening of assessment requires fresh material linking the taxpayer's transactions to the alleged income escapement, which was not established in this case.
Point of law: It is no doubt true that the Court cannot go into the sufficiency or adequacy of the material and substitute its own opinion for that of the Income Tax Officer on the point as to whethe....
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