IMPORTANT POINT
Reopening of assessment under Section 148 requires new tangible material; mere change of opinion does not justify reopening.

ORDER :

Niral R. Mehta, J.

1. By way of this petition under Article 226 of the Constitution of India, the petitioner has assailed the notice under Section 148 of the Income-Tax Act, 1961 (for short ‘the Act’) dated 31.3.2021 issued by the revenue authorities, by which the authority has sought to reopen assessment for the Assessment Year 2015-16.

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

2.1 The petitioner along with other co-owners sold the agricultural land situated at village Varnama during the year under consideration for Rs.4,02,00,000/- by way of executing sale deed on 23.5.2014. The share of the petitioner in the sale consideration was Rs.1,39,00,000/-.

2.2 From the aforesaid sale consideration received by the petitioner, following properties were acquired :

“(A) A residential property being Bungalow No.1, Shri Niketan Co. Op. housing society limited purchased vide two conveyance deeds executed on 02.03.13 viz. (1) one conveyance deed executed with Piyushbhai Kirtikumar Patel and Jagruti Piyush Patel (who owned 50% share in the said bungalow) for Rs.32,00,000/- and (2) one conveyance deed executed with Kirtikumar Shantibhai Patel (who owned balance 50% share in the said bungalow) for Rs.33,00,000/-.

(B) Three agricultural lands vide three separate conveyance deeds executed on 28.05.15, 20.05.14 and 08.10.13 and share of the Petitioner in the newly acquired agricultural land aggregated to Rs.65,95,762/-.”

2.3 The petitioner filed return of income for the year under consideration on 17.3.2016 declaring income of Rs.4,71,910/- wherein the capital gain on sale of above-referred agricultural land was disclosed and the petitioner had also claimed deduction of Rs.65,95,762/- under Section 54B of the Act as well as deduction of Rs.68,63,149/- under Section 54F of the Act against the capital gain from the sale of said land in respect of above investment.

2.4 The petitioner, thereafter, revised return of income on 11.3.2017 declaring total income of Rs.4,71,910/-, wherein capital gain in question as well as the claim of deduction under Sections 54B and 54F of the Act were duly reflected.

2.5 The case of the petitioner was selected for limited scrutiny assessment by issuance of statutory notice under Section 143(2) of the Act dated 18.2.2017. The case was selected for limited scrutiny assessment with a view to verify ‘whether deduction from capital gains has been claimed correctly’.

2.6 The then Assessing Officer vide notice dated 16.10.2017 issued under Section 142(1) of the Act, called upon the petitioner to furnish various details and evidence as under :

“(1) Complete ITR (income tax return) along with computation of income (point No. ‘ii’)

(2) Necessary documentary evidences such as (I) copy of sale deed, (ii) cost of acquisition, mode and date of payment, source thereof along with supporting documents and (iii) copy of relevant account from books of accounts (Point No. ‘v’).”

2.7 The petitioner vide letter dated 9.11.2017 furnished various details and evidence, as under :

“(1) Acknowledgment of return of income along with computation of income w.r.t. original return as well as revised return (Point No.4a);

(2) Bank statements for the period from 01.04.12 to 31.03.15 i.e. whole period of receipt of sale proceedings (Point No.4b);

(3) Conveyance deeds with respect to the following transactions (Point No.4c):

(a) Agricultural land sold during the year under consideration;

(b) Residential bungalow acquired out of sale proceeds thereof (in respect of which deduction under section 54F of the Act has been claimed);

(c) Agricultural lands acquired out of sale proceeds thereof (in respect of which deduction under section 54B of the Act has been claimed);

Explanation in relation to the fresh investments as well as claim of deduction under section 54B & 54F was furnished (Point No.4d).”

2.8 The then Assessing Officer issued show cause notice dated 24.11.2017 calling upon the petitioner to show cause as to why the deduction under Section 54F of the A