Magma Hdi General Insurance Company Limited v. Deputy Commissioner Of Income Tax, Circle - 8(1) & Ors

ORDER SHEET W.P.O. No. 554 of 2021IN THE HIGH COURT AT CALCUTTAConstitutional Writ JurisdictionORIGINAL SIDE Magma HDI General Insurance Company Limited VersusDeputy Commissioner of Income Tax, Circle - 8(1) & Ors. BEFORE: The Hon'ble JUSTICE MD. NIZAMUDDIN[[th]] Date : 10[[th]] September, 2021. Mr. Abhratosh Majumdar with Mr. Abhra Majumdar& Mr. Puspal Chakraborty, Advs.… for petitionerMr. S.N. Dutta with Mr. Soumen Bhattacharjee, Adv.… for respondents Heard both the parties. In this matter the petitioner has challenged the impugned notice dated17[th] March, 2020 issued under Section 148 of the Income Tax Act, 1961relating to assessment year 2015-16 and impugned order dated 30[th] July,2021 rejecting the objection of the petitioner against the recorded reasonfor reopening of assessment under Section 147 of the Act and subsequentnotice under Section 142(1) of the Act. The petitioner submits that one ofthe criteria of reopening of assessment under Section 147 of the Act thatis, omission or failure on the part of the assessee to disclose fully and trulyhis income in course of regular assessment has not been fulfilled and secondly, that the reason recorded shows that the Assessing Officerconcerned himself has recorded that it was true that the assessee had filedcopy of accounts along with required materials with the return of income tocomplete the assessment where various information/materials weredisclosed. Yet the Assessing Officer had recorded that the assesseecompany faulted in making the correct and true claim of his Book of Profitas per the provisions of Explanation (I) to Section 115 JB(2) of the Actwhich attracts the proviso to Section 147 of the Act, which according to thepetitioner, is nothing but mere change of opinion by the successor of thethe Assessing Officer who has allowed the aforesaid claim of theassessee/petitioner on the self-same material and documents in theoriginal assessment under Section 143 (3) of the Act and no new materialcame to the knowledge or to the possession of the Assessing Officer afterthe original assessment under Section 143(3) of the Act for invoking therelevant provisions of Section 147 of the Act. The petitioner furtherchallenges the impugned proceeding under Section 147 of the Act on theground that the issue which is involved relates to minimum alternate tax(MAT) of assessee company which do not fall in the category of theprovisions of Explanation (I) to Section 115JB(2) of the Act and contendsthat this issue has already been considered in the case of NationalInsurance Company Limited and in that case, CIT (Appeals) had held in favour of the assessee and against the Revenue on the aforesaid issue andfurther the order of the CIT (Appeals) was upheld by the Tribunal by itsjudgement dated 29[th] March, 2019 in ITA No.1876/KOL/2017 by holdingagainst the Revenue and in favour of the assessee and which has beenfurther challenged by the Revenue before this Court by way of Appealunder Section 260A of the Income Tax Act, 1961 and the same has beenadmitted by the order dated 29[th] August, 2019 in ITA No.112/2019 G.A.No. 2044/2018 (Principal Commissioner of Income Tax-2, Kolkata vs.National Insurance Co. Ltd.) and the same is pending without any interimorder. Petitioner has also contended that the aforesaid order of theTribunal where the same issue has been held in favour of the assessee,was relied upon by the petitioner in his objection filed against the recordedreason but the Assessing Officer in his impugned order of rejection hasneither considered nor referred it at all though under Section 119 of theIncome Tax Act, 1961, the Assessing Officer being a subordinate authorityin the hierarchy, the orders of the CIT Appeal and Tribunal were bindingupon him. Mr. Dutta, learned Counsel appearing for the respondent/AssessingOfficer, could not deny the admitted position in paragraph 3 of therecorded reason which runs as follows – Mr. Dutta, learned Counsel appearing for the respondent/AssessingOfficer, could not deny the admitted position in paragraph 3 of therecorded reason which runs as follows – “3. It is true that the assessee has filed copy of accountsalong with required materials with return of income to completethe assessment where various information/materials weredisclosed. Mr. Dutta could not satisfy this Court about what new material ofdocuments came into the possession of the Assessing Officer after theorder of assessment under Section 143(3) of the Act, which were notproduced by the assessee before the Assessing Officer in course of regularassessment. Mr. Dutta in support of his contention also relies onExplanations (I) and (III) under Section 147 of the Act. In my consideredopinion, the submission of Mr. Dutta is not convincing and acceptable andhe has failed to meet the allegations of the petitioner as recorded above. Considering the submission of the parties, I am inclined to setaside the impugned order dated July 30, 2021 of rejecting the objection ofthe petitioner to the recorded reason and subsequent notice under Section142(1) of the Act and remand the case to the Assessing Officer for a limitedpurpose and only to the extent to reconsider the aforesaid judgment of theTribunal on the issue in question in the case of Deputy Commissioner ofIncome-tax, Circle-6, Kolkata Vs. National Insurance Co. Ltd. reported in (2016) 72 taxmann.com 116 (Kolkata-Trib.) and also the contention of thepetitioner about the change of opinion and pass a fresh speaking orderafter giving opportunity of hearing to the petitioner or his authorisedrepresentative within four weeks from the date of communication of thisorder. The subsequent proceeding under Section 147 of the Act will dependupon the fresh order to be passed by the respondent-Assessing Officerconcerned after considering the aforesaid judgment of the Tribunal. Since this writ petition has been disposed of at the motion stagewithout calling for affidavit, allegations contained in the writ petitionshould be deemed to have denied by the respondents. WPO No. 554 of 2021 is disposed of accordingly. (MD. NIZAMUDDIN, J.) sb.