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BHARGAV D. KARIA, NIRAL R. MEHTA
Adani Wilmar Limited – Appellant
Versus
Assistant Commissioner of Income Tax, Circle 1(1)(1), Ahmedabad – Respondent
ORDER :
Niral R. Mehta, J.
1. Heard learned advocate Mr. B.S. Soparkar for the petitioner and learned advocate Ms. Maithili Mehta for the respondent.
2. Rule returnable forthwith. Learned advocate Ms. Maithili Mehta waives service of notice of Rule for the respondent.
3. By these petitions, the petitioner has challenged the notices dated 30th March 2021 / 31st March 2021 issued under Section 148 of the Income Tax Act, 1961 (for short, “the Act”) by the respondent – Assessing Officer seeking to reopen the completed assessment for the Assessment Years 2014-15, 2015-16 and 2016-17.
4. The brief facts of the case are that the petitioner is a company registered under the Companies Act, 1956 and is assessed to tax regularly. The petitioner filed its return of income for the Assessment Years 2014-15, 2015-16 and 2016-27 declaring total income as under :
| Sr. No. | Assessment Years | Amount of Income (In Rs.) |
| 1. | 2014-15 | (-) 50,91,28,151/- |
| 2. | 2015-16 | NIL |
| 3. | 2016-17 | NIL |
4.1 However, the petitioner paid tax on book profit under the MAT provisions of the Act as under :
| Sr. No. | Assessment Years | Amount of book profit (In Rs | |
The court established that reopening assessments requires a clear and valid reason to believe that income has escaped assessment, which was not present in this case.
Reopening of assessment under Section 148 requires clear, independent reasoning demonstrating income has escaped assessment, which was not satisfied in this case.
Reopening of assessment under Section 148 requires valid reasons; mere incorrect information cannot justify such action.
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.
The Assessing Officer's jurisdiction under section 147 of the Act has to be tested on the basis of the reasons recorded, and the reassessment proceedings cannot be based on a mere change of opinion w....
The Assessing Officer must establish the jurisdictional requirement for reopening and cannot rely solely on information without verifying if the issue had been disclosed during the original assessmen....
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....
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....
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