Reopening of assessment under Section 147 of the Income Tax Act is impermissible if based solely on a change of opinion without new evidence.

ORDER :

1. By this writ petition under Articles 226 and 227 of the Constitution of India, he petitioner has challenged notice dated 27th March, 2021 under Section 148 of the Income Tax Act, 1961 (for short ‘the Act’) as well as order dated 11th December, 2021 by which the objection raised by the petitioner was rejected.

2. Brief facts of the case can be stated as under.

2.1 The petitioner filed return of income on 26th September, 2013 declaring his income at Rs.12,09,758/- for the A.Y. 2013-14. The said return was thoroughly processed by the department and ultimately, scrutiny assessment order under Section 143(3) of the Act was framed on 27th March, 2015.

2.2 On 26th June, 2015 notice under Section 142(1) of the Act was issued directing, inter alia, calling upon the petitioner to furnish several details. Pursuant thereto, the petitioner filed several replies on 09th July, 2015, 16th July, 2015 and 01st September, 2015.

2.3 The respondent vide notice dated 14th October, 2015 again called upon the petitioner to provide further details. In furtherance thereof, the petitioner filed various replies on 20th October, 2015, 29th October, 2015, 30th October, 2015, 05th November, 2015, 30th November, 2015 and 29th December, 2015.

2.4 On 23rd June, 2014 the petitioner submitted details of service tax challan under VCES Scheme to the Deputy Commissioner of Central Excise & Service Tax.

2.5 On 31st December, 2015 assessment order under Section 143(3) of the Act came to be passed.

2.6 On 27th March, 2021 the petitioner received notice under Section 148 of the Act. The petitioner received a copy of reasons recorded on 09th June, 2021. Pursuant thereto, petitioner vide letter dated 24th July, 2021 filed objections against the reasons for reopening. However, the said objections came to be rejected by the respondent vide order dated 11th December, 2021.

3. Being aggrieved and dissatisfied with the aforesaid, the petitioner has approached this Court by way of this petition for appropriate relief.

4. We have heard learned advocate Mr. Darshan Patel for the petitioner and learned advocate Mr. Nikunt Raval for the respondent.

4.1 Since the coordinate Bench of this Court has issued notice for final disposal, the present petition, with the consent of learned advocates for the respective parties, is taken up for final hearing at the admission stage.

5. Learned advocate Mr. Darshan Patel for the petitioner, while assailing the impugned notice and the order, has made following submissions.

5.1 Learned advocate for the petitioner submitted that it is not the case of the authority as per the reasons recorded that the petitioner has not made true and full disclosure while filing return or during the course of assessment proceedings. Thus, in absence of any fault on part of the petitioner, it is not permissible in eye of law to reopen the scrutiny assessment under Section 143(3) of the Act. Accordingly, learned advocate has requested this Court to allow the petition as prayed for.

5.2 Learned advocate Mr. Patel for the petitioner next submitted that the entire reopening is nothing but a mere change of opinion. To substantiate his contention, learned advocate has emphatically submitted that at the time of original scrutiny proceedings, specific queries were raised with regard to payment of service tax and the same was considered under Section 143(3) of the Act. Therefore, learned advocate submitted that reopening is not based on any fresh and tangible material and thereby the same is said to be mere change of opinion. He, therefore, requested to allow the petition as prayed for.

5.3 Learned advocate for the petitioner lastly submitted that the sanction under Section 151 as envisaged was granted by the authority in a mechanical manner, without application of mind and recording reasons, and thereby initiation of proceedings based on improper sanction deserves to be quashed and set aside.

5.4 By making the above submissions, learned advocate Mr. Darshan Patel for the petition