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BHARGAV D. KARIA, NIRAL R. MEHTA
Parixit Irrigation Limited – Appellant
Versus
Assistant Commissioner Of Income Tax, Circle 3(1)(1) – Respondent
JUDGMENT :
(Niral R. Mehta, J.) :
1. By way of this petition under Article 226 of the Constitution of India, the petitioner has challenged the notice dated 18.03.2020 under section 148 of the Income Tax Act,1961 [for short ‘the Act’] whereby, the Income Tax department has sought to reopen the assessment of the petitioner for the Assessment Year 2013- 14.
2. Brief facts of the case as can be stated from the memo of the petition are as under:
2.1 The petitioner was engaged in the business of manufacturing sprinklers and drip irrigation system, P.P.Ball valves, HDPE pipes and execution of turnkey projects for the relevant Assessment Year 2013-14. It is the case of the petitioner that for the purpose of Companies Act, the annual accounts for the period from 01.04.2012 to 30.06.2013 was prepared. As per the balance-sheet as on 30.06.2013 ‘Other Current Assets” of the petitioner was shown aggregating to Rs. 8,07,13,133/- and for sake of brevity, the break up of the same was given in ‘Note 17’.
| Export Incentives receivables | Rs. 1,01,46,192/- |
| Interest receivable | Rs. 3,24,30,986/- |
| Claims receivables | Rs. 3,81,35,955/- |
| Total | Rs. 8,07,13,133/- |
2.
Reopening of assessments under the Income Tax Act requires new material facts; mere change of opinion is insufficient.
The judgment established the importance of tangible material and the prohibition of a mere change of opinion in the exercise of power under section 147 of the Income Tax Act.
Reopening of assessment under the Income Tax Act requires tangible new material; mere change of opinion is insufficient.
Assessee’s objections raised against the reopening proceedings are not acceptable as the case warrants scrutiny on the same lines. Accordingly, the objections so raised are hereby disposed off accord....
The court emphasized the need for tangible material to believe that income had escaped assessment and held that the power to grant approval for re-opening an assessment is coupled with a duty and can....
Reopening of assessment is “sufficient reason” to believe that there is escapement of income and the “sufficiency” of the reasons cannot be gone into by the High Court in a writ proceedings under Art....
Reopening of assessment under the Income Tax Act after four years is impermissible without failure to disclose material facts; mere change of opinion does not justify such action.
Under section 147 of the Act the proceedings for the reassessment can be initiated only if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any....
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