Counsel For The Appettant: Sri. A v. A. Siva Kartikeya

IN THE HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD WEDNESDAY ,THE FIFTEENTH DAY OF FEBRUARYTWO THOUSAND AND TWENryTHREE PRESENT THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYANANDTHE HON'BLE SRI JUSTICE N.TUKARAMJI INCOME TAX TRIBUNAL APPEAL NO: 128 0F 2006 Appeal Under Section 260 A of the tncome Tax Act, 1961 aggrieved by the order of the lncome Tax Appellate Tribunal, Hyderabad Bench _ BHyderabad dated 28-07 -2005 in ITA No. 783 t Hydt 2oo4 ( Assessment year1998-99 ) preferred against the order of the commissioner of rncome Tax (Appeals )Vl, 12th Floor, Gagan Vihar, M.J. Road, Hyderabad dated 29-07-2004 in Appeat No. 0193M-2, NLG/ crr (A) -vu 2oo3-04 preferred against theorder of the Income Tax Officer, Ward -2, Nalgonda, dated 31-.10_2003 in pAN/ GIR No. M-584 Between: tV/S.tVlallikarjuna Rice lndustries, Choutappal Mandal,Nalgonda ...APPELLANT AND The lncome Tax Officer, Watd-2, Nalgonda The lTO., Ward_2, Nalgonda ...RESPONDENT Counsel for the Appettant: SRI. A. V. A. SIVA KARTIKEYA Counsel for the Respondents: J V PRASAD (SC FOR INCOME TAX)The Court delivered the following: JUDGMENT Trrr llQMt!=E IHEcIlI! [. tCE U AL BII -\[.AN] ANI) T II i-l=[()N'_rtl.r . sR I J r_,S',t',rcF N.Tt' K.\ RAI\U I I.T.T.A. No- 128 .tt 2006 IIIDCMENT ['PL.rtt't ][ttt ][t'/t ]['/,, ][( ][t,Jt ]I,'tt." [t ],t,t/ [Ittut ][t)] Hear llr4r. A.V,A.Siva Kanikeya, leamed cor'6el for theappellant; md Nk. J.V.Prasad, learned Srandirp; Cbunsel,Income Ta l)epanment ior the respondenr 2. 2. Thisrppi'al has Lreen preier-red by the rss3s,see as theappellant urder Secticrr 260,4. oi rhe Incon.re Tar. Acc, 196L(brieflyhe' Act' lrereinafter) against tl:re orderdated 28.C'z.11005 [pmsecl ][bv ][ttre ][Incornr: ][Ta:< ][Appellate]Tribunal Fyclerabad Bench ['ii. ]I Iyclerabad (brief tv 'Tribunal'hereinafter)in I.-[.A.No.Z8.l/t li.r]/2004 ior the assessmenryear 7998-lt9). 3. Thou;h the :rp,peel\\'as;rc'lnritted on 14.()3,.20,16, nosubstantial prestion c,i l.ru'urrs l-renred. I{<rwcver, from thememo of : cpeel, u,e f ind th:rt lppellant has prr>posed thefollowrng t\ o questions ;rs srrbstenri;rl qLrestions of )aw a) Vherher on rhe facts and in rie circurnsances ofrhe case, Tribunal isreopenins or asscssment J:::,:#'l;ti *Acr panicularly *,hen rhe original a55655m6ng q/asconrpleted under Section 143(3) of the Act ?b) Vhether the amount of Rural Development Gssreinrbuned by the Food Corporadon of India in:rccordance wirh the provisiors of Ap.RuralDcvelopmcnr Ccss Act, 1996 .s atrade receipt andis ;r-sscssable as income rvhen the assqssee did notdcbit the liabiliry to pay cess to the p6cl_ Account ? 4. First question is whether Tribunal was jwtified m sr.lsratnutg the reopening of assessment under Section 14g ofthe Act when rhe original assessment was completed underSecrion 1a-l(l) ol the Act.14g ofthe Act when rhe original assessment was completed underSecrion 1a-l(l) ol the Act. 5. 5. Appcllant befbre us rs a pannership firm and is anassessec rurcle r rhe Act. Appellant is engaged in the businessof rice irrclrrstries. For rhe assessmen t year 199g-99, appellanthad filed rcrrrrl of incomc which was subjected to scrutinywhereattcr, irssessnlcnr undcr Secrion 1a3e) ofthe Acr wasconrpleted on 2J.Cg.1999 determining total income of theappellant .rr Its.4O,94l.OO. Subscquencly, ir was noticed by the 4. First question is whether Tribunal was jwtified m sr.lsratnutg the reopening of assessment under Section 14g ofthe Act when rhe original assessment was completed underSecrion 1a-l(l) ol the Act.14g ofthe Act when rhe original assessment was completed underSecrion 1a-l(l) ol the Act. 5. 5. Appcllant befbre us rs a pannership firm and is anassessec rurcle r rhe Act. Appellant is engaged in the businessof rice irrclrrstries. For rhe assessmen t year 199g-99, appellanthad filed rcrrrrl of incomc which was subjected to scrutinywhereattcr, irssessnlcnr undcr Secrion 1a3e) ofthe Acr wasconrpleted on 2J.Cg.1999 determining total income of theappellant .rr Its.4O,94l.OO. Subscquencly, ir was noticed by the assessing [o['rc(]r ][that ][in ][the list ][oi ][creditors ][iil:d ][by ][the]appellant [alt ][ng ][with ][the ][retr'rnr ][o[ ][income' ][an ][rntot'nt o[]Rs.11.,30,465 [0() rvas ][shown ][as ][otrtstanc{ing ][Rural ][Dt"u':lopment]Crss [(RD ][( ][:s$, ][which ][is ][leviet-l ][untler ][the ][l':rdlr::r ][P:adesh]Rural [Deve ][ol)nrcnt ][l\ct' ][1996' ][fusessing ][offict': ][took ][the]view [that ][e: ]P()ndittlre [on ][accorrnt o][i ] [O'ss ][is ][al'otable ][in]computing [tl-e ][income ][o[ ][th:rt ][pt-cvious yL'ar lII][ rvl.rch ][the]amount [ls]ctually [paid. ][It ][rvas ][ior'rnd ][in ][tlut ][c'rse ][tlrat ][liabiliry]rlss w,rs incurretl [b,v ][the ][appellanr ][during ][the]to pay previor'rs 1 [:ar- ][relevant ][to ][the ][xssessnrent ][ye'1r ][L91rl3'99 ][but ][the]said [amor ][ot ][renuined ][outst;rrtclirrg ][i1s ][the ][xpPe ][lirnt ][lrad ][not]arne [during ][thc ][1.rn'r'iotts ][rc:rr' ][-l'llr' ][-':!on" ][tt ][was]paid [the]shown [as]a iiabiliry [in ][thc ][[''rl'rrrcr' ][sheet' ][r\sst':'sing ][officer]took [the]vi,ru' that [this ][etrlotrtrr shotrlcl ][luve ][t't ][t'rr ][disallowed]and [add,]d b;rck [to ][the ][t()r-'il ][itrcotlre ][oi ][tl-ie ][rs ][scs';ee ][u4rile]the [assessmctrt ][tttrtle ][r ][Scctior ][i4ll'' t ][o1 ][the ][Act']conrpletirq As thisv.Snotdorrc'lsscsstlrgo[licerrsstre.lri<.ticetlnder1li4 oi [the Act ][on ][l6'01'lCCl ][ro ][ihe;rppe[ant]Section,zproposiLg to [adcl ][the ][otrt ][st ]['rritlir ][lg :llrlottrlt ][of ] [) ][( ][bss ][to ][the] tohl income. In response thereto, appellant filed replycontending that rhe amounr reccived towards RD Gss wasneither credited to the profit and loss accounr nor claimed asexpenditure but a separare account was mainrained and shownin the balance sheet. It was contended that this amounr wasreceived from Food Crlporation ol'India to which appellanthad sold the ricc. 6. Considering rhe rcply of the appellanr, assessing officerof the appellanr, assessing officerthe appellanr, assessing officerappellanr, assessing officerassessing officerofficerdropped the proposal under Scction 154 of the Act. It wasthereafter that noticc under Section 14g of the Act was issuedfollowing whiclr rhe assessrr]e nr was r-eopened and completedunder Sectiort 147 of thc Act wtereaiter assessment orderdated 31.10.200J uas passecl r.rndcr Section 1a3(3) of the Actread with Section 142 thcreol'. By the aforesaid order, the RDCess amounr was adc-lcd to the income of the appellant.7. On the objcction raiscd by the appellant that all materialfacts were disclosc-d bcibri: the asscssing officer at the time oforiginal assessllrcrlr:rnd the rt,l'orc, the reopening was sought to Considering rhe rcply of the appellanr, assessing officerof the appellanr, assessing officerthe appellanr, assessing officerappellanr, assessing officerassessing officerofficer be done or the basis of change of opinion, assessing officertook tlre vi :q.that the reopening was being done for,rr",,ithin yrars f rom .h: end ol the relevant assessment \ea., t[r(]re[ore,the questi< n of esc,rpement of income <lue r, r faiiure oromission o r lhe part of the assessee to disclose rr::rerial factsat thc tir a of original assessmenr, rhe reby :or fen-ingjurisdiction on the assessing officer to K'open :rssessme nrproceedingr , cloes not arise. Considering rhe rcply of the appellanr, assessing officerof the appellanr, assessing officerthe appellanr, assessing officerappellanr, assessing officerassessing officerofficer be done or the basis of change of opinion, assessing officertook tlre vi :q.that the reopening was being done for,rr",,ithin yrars f rom .h: end ol the relevant assessment \ea., t[r(]re[ore,the questi< n of esc,rpement of income <lue r, r faiiure oromission o r lhe part of the assessee to disclose rr::rerial factsat thc tir a of original assessmenr, rhe reby :or fen-ingjurisdiction on the assessing officer to K'open :rssessme nrproceedingr , cloes not arise. 8. On e tp,eal bef,tre the Commissioner o[ ]nr;onre Tax(Appeals)-I [r, ]Hydera.bad (briefly 'CIT(A)' here:n;rfter), thefist appt llate aurhority irle tlre rppcl ar e orderdated 29.07 2(t04 held that reopening ol-asscssrr.rt'rrt r,,as donewithin four re.rn frorrr the end of the re lei,lnr :lsse ss nle r[ ].r;lrand after o[ mimng approval of the highe r arrthorirv ani :riterrecordrng p. )[)er 1px5Cr[s. Therefore, thc senre u:rs rrph,'ld. 9. ()n fi rtrer app,:al before the Tribun,rl, the uier,", tal<e nby a'f(A)Iasaffirmed by the Tribrrn:r rr./i .[re ordcr'datcd 28.07, lCC5. Tribunal held that rs pel l:rpler:rion (2) ro Section 147 of the Act, even where an assessrrcnr is made, solong as the notice is issued under Section l4g of the Actwithin four years from the end of rhe relevant assessment )ear,if the income chargeable to tax is under assessed, ir has to bedeemed that such income had escaped assessment and thusthe reopening of assessmenr on such a ground is permissible.Accordingly, the view taken by the assessing officer, asaffirmed bythe firsr appenate aurhoriry, was confirmed.10. Advening to rhe assessment order dated j 1.10.2003, it isevident therefrom that at the time of filing the onginal retumof income, appellant had disclosed rhe [ist ol creditors whereinthe outstanding RD Gss was rrentioned and it was shown asa Iiabiliryin the balance sheer. 11. Initiallyassessn1en[procecciing was taken up forscrutmy and assessment orcler was passed underSection M3(3) of the Act. Subsequently-, a vie."v was taken bythe assessing officerthat the orrrstanding RD. Crss is requiredto be treated as income of the appellant. .Ihe assessnrent IIIIl order nas s ugh.t to be rectified under Section 15.1 ol tlre Actand accordi Lg[y, notic,: was issued V4ren this rvas :,bje':red toby the appe [art, procr:eding under Section f .i4 oi tLre Act w.rsdropped. I r,,a:; then:after thar the notice under S,t,ction 148o[ the Act r ar issued following which assessrnent :roce edingsuer-e r-rndert rk:n under Sectior. l4T of rhe Act. 12. I{ever ne authorities have justified rec pr:nirrg oias ses s nle nt )n the grc)und that the reopening u,as : rmecl ouru.ithin fotrre:rn from the end of the relevant asse::;':nent ye ar;tlrertiore, t[ :re is no bar for the assessing office r t -- r-e\,:sir rhelSSeSSnient,rrleri question whether the assessec h: rl mrclc l.r"rllclisclosure o ['rrot. ]would not be relevant in such a ( ir.ei (r\,cn iltull clisclosu e is made. if the assessing officer is oi tlre opinionthat lncom(chargeable to tax has escaped asscs;rrrc.nl, irISopeu !o lrirr tc, r,:open a concluded assessmenL. I l. Ve ar : :rfraid we cannot subscribe to sr-rch r r ieu trlie nlr). ttre rer.e, u() authority. 12. I{ever ne authorities have justified rec pr:nirrg oias ses s nle nt )n the grc)und that the reopening u,as : rmecl ouru.ithin fotrre:rn from the end of the relevant asse::;':nent ye ar;tlrertiore, t[ :re is no bar for the assessing office r t -- r-e\,:sir rhelSSeSSnient,rrleri question whether the assessec h: rl mrclc l.r"rllclisclosure o ['rrot. ]would not be relevant in such a ( ir.ei (r\,cn iltull clisclosu e is made. if the assessing officer is oi tlre opinionthat lncom(chargeable to tax has escaped asscs;rrrc.nl, irISopeu !o lrirr tc, r,:open a concluded assessmenL. I l. Ve ar : :rfraid we cannot subscribe to sr-rch r r ieu trlie nlr). ttre rer.e, u() authority. 14. This aspecr \Mas gone into by a Full Bench o[ the DelhiF[gh Court in CIT v. Kelvinator of India Ltd1, againstq,{rich decision, revenue preferred appeal before the SuprerneClun. In CIT v. Kelvinator of India Ltcl2, Suprenre (-bunextracred Section 147 of the Act, w,hich existed in the statutebook prior to Direct Tax Laws (Amen<Jmenr) Act, 19gZ aswell as Section I4l of the Act, which came inro rhe statutebook after enactmenr of the Direct Tax Laus (Amendment)Act, L987. Thereafter, Supreme C_oun hcld thar reassessmenrhas to be based on fulfillnrent of ce nain preconditions and ifthe concept of 'change of opinion' is ren.roved as contendedby the revenue, then in the garb o[ r-eopcning rhc asscssr.nenr,a review would take place, which is nor perlrissible under theAct. Supreme Coun held as follows: On going through the chanses, qtLoredabove, made to Section 147 of ite Act. ,rc finc.lthaq prior to Direct Tax Lari,s (funcndnrcnt)Act, 1987, rcopening could be dorre rLnclcr thcabove two condirions and fullilLncnt of rhc s.ricl l [2002] 25$ trR I (FB)' [20r01 320 rTR s61 (SC)[2002] 25$ trR I (FB)' [20r01 320 rTR s61 (SC) t con litions irlone conferred [jurisdiction ][on ][t ][n ][e]fus ['ssinq ]Officer to make [a ][back ][assessmr':rr-,]br.rt nr Se ctio n 1,47 of the Act [with [efla. ][t]fror r l" April, 1989], theyare [given ][a ][go-by:rn,-l]onl cne corLdition [has ][remained, ][rzi., ][tlr:.t]u4r, re the A;sessing Officer has [reason ][t,r]bel, 'v,r that income has escaped [assessm(ttl ][t.]cor ers itrrisdicdon to reopen the [assessmr:.r ][t.]Th, re[ore, post-1't April, 1989, Poq€r [tc]reo rer-L is much wider. F{owever, one [needs ][l.c]giv, :r. schemiltic interyretation to the u'c ris"rc. scn to lxlieve" failhg which, we are afrril,Sec ion 147 would give artitrary [pov/en ][to ][the]As: :sr;ing Officer to reopen assessments [on tlte]bes s o: ["me're ]change of opinion [", ][u'[,ic:h]..ll l( r l)e /,'r'..' reason to reoPen. [\(/e ][must ][.t ][.'o]licc r in mind the conceptual difference betweenpo' ci' to review and power.to [reassess. '[1:e]fu: :s;in.g Officer has [no ][power ]to [review, ][l.e]h.-rs tl'e power to reassess. But [reassessment ][lt,rs]to b, based on fulfillment of [certain ][pr,r-]cor Ci:ion and if [the ][concept ][of ]["change ]'.>fop rir>n [' ]is rerno.,ed, [as ][contended ][on ][behelf ]':rfthe Dep,rttment. then, [in ][the ][ga6 ][of ][reopelr ][ng]rhe r;scsstlent, [reviet' ][*ould ][ta[<e ][place ][. ][(-\re]rnr;r- tllr;.tt tht' concept [of ]["change ][of ][opinic'n"]es rn ir"built test to [check ][abuse ][of ][pou'er lrv] the fusessing Officer. Hence, after 1,, April,1989, Assessing Officer has power ro reopen,provided there is [,tangible ]material,, ro cornc rothe conclusion that there is escapement ofincome from assessment. Reasons must h.rve aIive link wirh the formation of the belief. Ourview ges suppoft from the changes rn:rde toSection 147 of the Acr, as quored herrinabovc.Under the Direcr Tax [aws (A.rnendrnent) Act,1987, P^itarnent not only deleted rhe u,ords"reason to believe,, but also insened thc u,or cl"opinion" in Secdon 147 of the Act. IJoue vcr.on receipt of reprcsentations fiom rheC-ompanies against omission of rhe u.ords"reason to believe", parliament reintroclLrcedthe said expression and deleted the t,orcl"opinion" on the ground that it rv.oulcl r.cstatbinry powers in the fusessing Officcrquote hereinbelow the relevant poniouol-Circular No.549 dated 31., October, 19g9. rvhichreads as follows: "7.2 Amendnrent made by thc Anrcntlir:qfut, 1989, to rcintroducc rhc cr1,1..,,rx,11'reason ro believc' in Sccriorr I{7.--.\numbcr of representatiol.ls \rrlc rrccn.t,tlagainst the omission of the r,,.61115 [.11.1., ],11to believe' frorn Section i47 .utl tlu.ir Il l l ij Ii!II lll substitLuion by the 'opinion' of lleAssersing Officer. It was pointed out rbarthc nrcruring of the expression, ['reaso:r ]rolrelicvt h.rd been explained in a rrunr;,.'ro[ coun rulings in the past antl was c"n::l[settlel and its omission from Section I4-7r...ouli sive arbitrary powen to J rethc nrcruring of the expression, ['reaso:r ]rolrelicvt h.rd been explained in a rrunr;,.'ro[ coun rulings in the past antl was c"n::l[settlel and its omission from Section I4-7r...ouli sive arbitrary powen to J reAsscssing Officer ro reopen la.sr.rsscs:inlents on mere change of opinit:-r.T<r rr lay rhese fean, the Amending ^.r.t,1989, h.rs again amended Section 14,'toT<r rr lay rhese fean, the Amending ^.r.t,1989, h.rs again amended Section 14,'toreintrodr-rcc the expression'has reason to[re[ie.e' ir place of the words 'for reasc,;'rsto lre rccorded by him in writing, is of rJieopinion'. Other provisions of the ;re wScctit,n 1,17, however, remain the samr."[re[ie.e' ir place of the words 'for reasc,;'rsto lre rccorded by him in writing, is of rJieopinion'. Other provisions of the ;re wScctit,n 1,17, however, remain the samr." 15. In D: n',od:rr [I. Shah r.. Asst. CIT3, a Divi:;ion Benchoi rlIt'[(ir. ]ar:rtI ligh C,ourt took the view dra I c,nce aproceetlins trnder Section 154 of the Act is <lrr.rpped onobjection r: si.d L', v rh,: asscssee, it is not open to threft)venLreto irriti,rtc p or:ecdings Lurcler Section 148 of the Acr.. [()ujartrt]I Iiqh [(irtnt ]rclcl es [ollous: ' tJi ll R 77r 15. In D: n',od:rr [I. Shah r.. Asst. CIT3, a Divi:;ion Benchoi rlIt'[(ir. ]ar:rtI ligh C,ourt took the view dra I c,nce aproceetlins trnder Section 154 of the Act is <lrr.rpped onobjection r: si.d L', v rh,: asscssee, it is not open to threft)venLreto irriti,rtc p or:ecdings Lurcler Section 148 of the Acr.. [()ujartrt]I Iiqh [(irtnt ]rclcl es [ollous: ' tJi ll R 77r "...Mistake apparenr from the record which hasthe effect of enhancing assessmenr ought to bethe effect of enhancing assessmenr ought to berectified by resoning to this special and spedyspecial and spedyprocedure u,hen in the view of ,h. A"r.rrirrgOffrcer it is unnecessary ro rcsorr to reopeningof the assessment. In the field of .hag"rblJinclme escaping assessment, however,sectron 142 is very widely worded and rvouldinclude even escapement due to any mistal<c ininclme escaping assessment, however,sectron 142 is very widely worded and rvouldinclude even escapement due to any mistal<c inthe assessment order. But, when even accordingto rhe Assessing Officer himself th",. i, .rnistake, apparent from the record as it exiss.even accordingto rhe Assessing Officer himself th",. i, .rnistake, apparent from the record as it exiss.commimed in the order of assessnrenr, which isrectifiable rectifiable on the basis of the existing recordunder secrion 15a being a special provisionexisting recordunder secrion 15a being a special provisionnrade for the pupose, and that there is r_ro ncedto rcsort to reopening of the assessnlcnt iscontemplated by section 14g rcad withscctron 142of the Act, rhen he musr rcsor1 roto rcsort to reopening of the assessnlcnt iscontemplated by section 14g rcad withscctron 142of the Act, rhen he musr rcsor1 rothe provision and cannot wantonly or ar_bitrarilv;rnd wirhoutvalid reason reson to ..op.ni,rg ofthe asses5ment...the asses5ment... Jhc function of the Assessing Officer .rctingurrder section 147 s noc lirnited, as urx{erscctron 154, rnerely ro rectifying the result u.hich.rctingurrder section 147 s noc lirnited, as urx{erscctron 154, rnerely ro rectifying the result u.hichnu1, havc been vitiated due to mistake :rpp,ucnr fro n the record. It s'ould therefore follow..hruin :r;c: of rnistake resulting in escapem:rrt,rvh :lr i,; the arel u,hcre both the provisi:rLswo Lltt f,econr,: televant, the fusessine Off r<:,,rrri,il h:rve to consider rvhether he was requrredby lr,, nature of escepement to reconsider ttrequr ;ri:rn of h<>u. lre ruould xcertain and asr r::;sinc, n,e rhat hes escaped assessment and reope nthe ir-sse;snrenL or if that is not requrred tlr,:.rme: :l',. r,> recti.l-y rlie misrrken result on the b:uisof r re erjsting rccord. I[ he chooses to resofl tr)the I ormer, t. !. , secrion 147 reed uithsecl orr 148 proceedings, he cannot lt,_.con pr'lkd ro rcsorr ro section 154 becaue tbatnot lci inrpinge upon his subjective satisfact onrrrrd [,r ]section 117. But if he resorts c,:)scct crr 1-r.1 oh rlle glound thar the mistake irthe rnicr-rrpp.ucnr trour rlre record has resukr,:lin sc.rpernenr s'hich could be recr ified b,zerne r<linq the orcler :rnd enhancrng rh,::.rsse s )enr. tlrt n he. on iinding that there is r,r rsrrcl nristekc .lpp;lrtnr irorn the rccc,rr1\\'.u. rntrrLg recril icerion since thc vievr tal<en i,pleLr il'lc. cannor in rlrt, ,rbsence of any otlu:r.gror r( on tht' ltesis ol ri hiclr he has still reas:r:to x,lieye th.rt rhc income has escaperi,lSSe sl't(,tlr. stJll 1'rroccedings again un(.(:r. section 147. If he finds thar there is no suchmisrake since the result was $/aranted from therecord, there would be no occasion to amendthe assessrnenr order. where the rectificationcould not be done on the ground that therewele two views possible or that there wasdiscretion law{ully exercised, then the same willalso be true even when the Assessing Officersufts the proceedings under section 147 on thesame rnterial because, that power cannot beinvoked when there is only a mere change ofophion and in case where in rhe proceedingsunder section 154 it is found that whar wasthought to be a misuke was not a mistalebecaue that view was warranted or permissiblefrom the existing record, then the same findingwill trind the fusessing Officer *{ren trying toexcrcisc powers under section 147. In such acase, it rvould be incumbent on the pan of theAsscssing Officer who had chosen to r€solt tosection 154 to demonstrate why he is now forthe same pupose resoning to section 147.'flre ri: has to be some compelling reason in sucha c.rse for him sd]l to believe that the incomethat uas the subiect-matter of rectification hasescaped :Nscssmenr though that [q/as ]not due toany obviots rnismke bome out from the existing rr( )rl, u,hich could be rcctified urrerse<:ic,n 154. .........1t s,rll nor beop :n t() the fusessing Officer ro arbitr.rril,, ,tro7.- 11,ln11 resc,ll to the provisions o[ s,.ction ,,t7wl :t,: the process of rectificati()n ulderser tion 154 f.rils on the merits. 16. Upo , rlue consideration and rhorough eK.rrilnarion ofthe mater-i: .s on record, we are of the view thrt rl)r)pening ofassessment ir, this c:rse was entirel)/ on account o[ ch;rnge ofopinion b r.he assessing olficer. In tlre initia. :NS(,ssmentproceeding ; rrnder Se ction lal(l) of the AcL, he haC a,:ceptedthe clrrim c I rht.appellant rhar rhe outstanding RI) Gss was aliability anr accorclinql), did not make rcldition of tl.re :;ame tothe incomr ol the;rsressec. Asscssinq ollicr'r, u1;,rrr change ofopinion, La,l sor.rght to rccti[), the ;iss('ssn1(]nr underSection 15 ol'thc r\ct btrt th;rt rv:rs qiven trp whe.n ol>jectionwas raisec ['[-hcn'rrlter. ]he h:rc] issucd rhc rr,rrice underSection 14 t,l thc A,-'t ;rr-rd caniec{ out the rr::rssc: s rner.t underSection l, 7 ol thc i\ct. In oru- opini<,n, t[,rs is clearlyimperrniss rl,:. 17. Consequently, we answer the fint substantial [qtrestion] of law framed above in favour of the appellant-assessee [and] against the respondent-revenue. In view of [ans ][wer ]to [the ][first] question, the second question need not be gone [into.] 18. Appeal is accordinglyallowed. No costs. As a sequel, misce[aneous petitions, pgnding if [any,] .-/ stand closed. Sd/-C.V.MALLIKARJ JOINT REGISTRAR //TRUE COPY// SECTION OFFICER To 1. The lncome Tax [Appellate ][Tribunal, Hyderabad Bench ]- [Hyderabad(with]records if any)records if any) 2. The Commissioner [of ][lncome Tax ][(Appeals ]) [Vl, ][12rh ][Floor, ][Gagan ][Vihar,]Ivl.J. Road, Hyderabad 500 [001]Ivl.J. Road, Hyderabad 500 [001] 3- The lncome Tax [Officer, ][Ward-2, ][Nalgonda] 4. One CC to SRl. A. V. A [KARTIKEYA, Advocate ] 5. One CC to SRI J [PRASAD (SC ] [TAX) Advocate ][ \y 6. Two CD Copies HIGH COUR'- DATED:1 510,).12023 Judgment ITTA.No.128 of 2006 ALLOWING THE IT 111. '$/ff HOt. T COSTS €l["\\i] .., ,- . :.'-'':- {'.r- [::- ]" [-' ][-,\,]"-' i'.,\.,s,);T'tlNt..l iIL)!i,f.: /ti rl'1. [.) ]11.; til* -.,?'\:--.-----r/ [']