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2026 Supreme(Online)(ITAT) 6782
INCOME TAX APPELLATE TRIBUNAL (AHMEDABAD BENCH)
BRR Kumar, Vice President, T. R. Senthil Kumar, Judicial Member
Gujarat State Petroleum Corporation Limited – Appellant
Versus
DCIT Gandhinagar Circle – Respondent
ITA Nos. : 1165 & 1166/Ahd/2025 | ITA Nos. 1254 & 1249/Ahd/2025
For the Assessee/Appellants:Shri S. N. Soparkar, Sr. Advocate & Ms. Urvashi Shodhan, A.Rs.
For the Revenue/Respondents: Shri Rignesh Das, CIT.DR
Reopening u/s 147 invalid as mere change of opinion without failure to disclose material facts or fresh evidence.
Headnote:Under S.147 r.w.s.144B of the Income Tax Act, 1961, reassessment proceedings were initiated for AY 2014-15 and 2015-16 challenging disallowance u/s 14A r.w.r.8D and adjustments u/s 115JB due to exempt income from investments in mineral oil exploration and trading. Assessee, a government company, had original assessments u/s 143(3) with partial disallowances under scrutiny, confirmed by CIT(A). Tribunal found no failure to disclose material facts, as issues were already examined. Reopening beyond 4 years constituted change of opinion. Key issues: Whether reopening valid absent fresh tangible material or failure to disclose facts under S.147 proviso; merger principle barring reassessment on appealed matters per jurisdictional precedents. Ratio: No jurisdiction for reopening where AO had all details during original proceedings and made disallowance u/s 14A; supported by Gujarat HC rulings emphasizing recorded satisfaction mandatory (Gujarat Enviro Protection, Kanak Fabrics, Gujarat Gas Ltd.). Reassessment proceedings quashed for both years; assessee's appeals allowed, revenue's dismissed.
| Table of Content |
|---|
| 1. cross appeals on reassessment validity and disallowances. (Para 1 , 2 , 3) |
| 2. assessee challenges reopening as change of opinion. (Para 4 , 5) |
| 3. counsel arguments on merger and disclosure failure. (Para 6) |
ORDER
PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-
These cross appeals are filed by the Assessee and Revenue as against separate appellate orders both dated 28-03-2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “CIT(A)”), arising out of the reassessment orders passed under section 147 read with section 144B of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Years 2014-15 and 2015-16 respectively. Since common issue of challenging the reopening of assessment, disallowance made u/s 14A r.w.r. 8D and u/s. 115JB of the Act are involved in both the assessment years, for the sake of convenience the above appeals are disposed of by this common order.
2. The brief facts of the cases are that the assessee is a Government Company engaged in the business of exploration, exploitation and production of Mineral Oil, Trading of Natural Gas, Generation of Power, etc. The details of Returns of Income filed, assessment completed u/s. 143(3), appeals filed before CIT(A) and thereafter reopening of assessments are as follows:
A.Y. 2014-15 A.Y. 2015-16
3. Aggrieved against the reassessment orders, assessee filed appeals before Ld CIT[A], who has confirmed the reopening of assessment as correct in law and deleted few additions made by the Assessing Officer and thereby partly allowed the appeal in favour of the assessee and in favour of the Revenue.
4. Aggrieved against the appellate orders both are in appeal before this Tribunal. Grounds of Appeal in ITA No.1165/Ahd/2025 (Assessee’s appeal for A.Y. 2014-15) ITEM NO. I: Re-opening of assessment on account of change in opinion 1.1 The learned CIT(A) has grossly erred in law in confirming the action of the learned A.O. of reopening the case to increase disallowance u/s. 14A r.w.r. BD of the Act merely due to a change in opinion, despite the appellant having fully disclosed all material facts and information during the original assessment proceedings.
1.2 The learned CIT(A) failed to appreciate that the then learned A.O. had all necessary documents and details to make an informed decision while passing the assessment order u/s. 143(3) of the Act. There is no fresh information and it is merely a change in opinion by the learned A. O, which is not permissible u/s. 147 of the Act.
1.3 The learned CIT(A) has grossly erred in law in upholding the reopening of the assessment merely on the ground that the appellant did not maintain separate books of account for its investment activity.
1.4 The learned CIT(A) has failed to appreciate that the non- maintenance of separate books cannot be treated as fresh information for reopening the assessment. Moreover, it cannot be a basis to allege that the appellant had failed to disclose fully and truly all material facts during the original assessment proceedings.
1.5 The learned CIT(A) failed to consider that the then learned AO has already disallowed Rs. 3,57,11,381/- u/s 14A r.wr. BD of the Act while passing order u/s 143(3) of the act and the same issue is pending before Hon'ble ITAT and hence in view of the decisions in case of Metro Auto Corporation vs. ITO (2006) 286 ITR 618, Bombay HC and Chika Overseas (P) Ltd v ITO (2011) 131 ITD 471 (Mum) (Tribunal), re-opening cannot be made for issue which is subject matter of appeal
1.6 The appellant prays to your honour that the re-opening of the assessment made solely on a mere change of opinion, is void-ab- initio and deserves to be quashed, as such reopening is not permissible under the provisions of Section 147 of the Act.
ITEM NO.: II Disallowance u/s, 14A r.w.r. 8D of Rs. 10,02,013/- (Rs. 3,67,13,394/- as per Assessment order u/s. 147 r.w.s. 1448 of the Act Less: Rs. 3,57,11,381/-already disallow
