Rehana Anwar Shaikh … Petitioner.( v. Shalikramdigitally Signed Byshalikrampralhadraopralhadrao Boreyboreydate: 2022.01.2019:17:27 +0530

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO. 1922 OF 2021 Rehana Anwar Shaikh … Petitioner.(PAN No. ) Vs. Income Tax Officer, Ward -20(3)(1),Mumbai -400 012 and 2 Others. … Respondents. --- Mr. R.S. Padvekar, Advocate a/w. Mr. Tanzil R. Padvekar for the PetitionerMr. Sham V. Walve, Advocate for the Respondents-Revenue. --- P.C. : CORAM : K.R. SHRIRAM & R.N. LADDHA, JJ. DATED : JANUARY 18, 2022 (Through Video Conferencing) 1.Petitioner is impugning a Notice dated 19.03.2020 issued under section148 of the Income Tax Act, 1961 (said “Act”) for AY 2013-14, seeking to reopenPetitioner’s assessment. The notice has been issued after expiry of four yearsfrom the relevant Assessment Year and in this case, assessment under section143(3) has also been completed. Therefore, the proviso to section 147 wouldapply, by which the onus is placed on Respondents to show that there wasfailure on the part of Petitioner to disclose truly and fully the material factsrequired for assessment. 2. As recorded in the reasons for reopening, it is the Jurisdictional AssessingOfficer’s (JAO) case that Petitioner was found to have entered intotransactions in the scrip of a shell company-M/s. Confidence Finance &Trading Ltd., which is a Penny Stock Company and Petitioner has receivedRs.6,34,78,550/- on the sale of scrip during the Assessment Year and thetransaction of the sale and purchase in this scrip has been included in the exempt income for the year. Therefore, there was reason to believe that income, aschargeable to tax, has escaped assessment. In our view, Respondents havefailed to prove that there was any failure by Petitioner to truly and fully disclosematerial facts. 3.Moreover, the notice to reopen is issued purely based on change ofopinion. This is because the Assessing Officer, prior to passing the originalassessement order raised a query vide communication dated 23 November, 2015,specifically raising a query regarding this Company, Confidence Finance &Trading Ltd.. The queries read as under : “Sub : Assessment proceedings in your case for A.Y.2013-14 -reg.- In connection with and in continuation with yoursubmissions filed, you are required to comply with the following : 1.In last three to four years, what was the volume of sharetransactions done by you ?.transactions done by you ?. 2.What is your way of choosing the shares for investmentpurpose?.purpose?. 3.File Brokers office address. 4.How did you come to know about the company, M/s.Confidence Finance & Trading Ltd.. 5.What does the company M/s. Confidence Finance &Trading Ltd., dol ?. 6.How many shares listed on NSE or BSE were purchased orsold by you in last three years. 7.Has any of your relative/ friend also purchased shares of M/s. Confidence Finance & Trading Ltd., 8.Whether the promoters of M/s. Confidence Finance &Trading Ltd., are you relative or friends. You are required to comply with the above details within sevendays of receipt of this letter.” 4.Petitioner replied by its letter 30 November, 2015. This letter was 2.What is your way of choosing the shares for investmentpurpose?.purpose?. 3.File Brokers office address. 4.How did you come to know about the company, M/s.Confidence Finance & Trading Ltd.. 5.What does the company M/s. Confidence Finance &Trading Ltd., dol ?. 6.How many shares listed on NSE or BSE were purchased orsold by you in last three years. 7.Has any of your relative/ friend also purchased shares of M/s. Confidence Finance & Trading Ltd., 8.Whether the promoters of M/s. Confidence Finance &Trading Ltd., are you relative or friends. You are required to comply with the above details within sevendays of receipt of this letter.” 4.Petitioner replied by its letter 30 November, 2015. This letter was exhaustive and contains every detail that the Assessing Officer had called for.Thereafter, the Assessment Order dated 29 January, 2016 has been passed,accepting the return of income declared by the Petitioner in the sum of Rs.12,45,910/-. It is true that in the Assessment Order dated 29 January 2016, thereis no reference and/ or discussion to disclose the Assessing Officer’s satisfactionin-respect of the query raised but as held in Aroni Commercials Limited Vs.Deputy Commissioner of Income Tax-2(1),[1]once a query is raised duringassessment proceedings and the assessee has replied to it, it follows that thequery raised was a subject of consideration of the Assessing Officer whilecompleting the assessment. It is not necessary that an assessment order shouldcontain reference and / or discussion to disclose its satisfaction in respect ofthe query raised. As noted earlier, the very issue of Petitioner entering intotransactions, relating to the scrip of Confidence Finance & Trading Ltd., was asubject of consideration by the Assessing Officer during the original assessmentproceedings. It would, therefore, follow that re-opening of the assessment bythe impugned notice is merely on the basis of change of opinion of theAssessing Officer from what held earlier during the course of the assessmentproceedings, leading to the assessment order dated 29 January, 2016. Thischange of opinion does not constitute justification and/ or reason to believe thatincome chargeable to tax, has escaped assessment. 5.In these circumstances, we set aside the Notice dated 19 March, 2020issued under section 148 of the said Act. Consequently, the order on objectionas well as subsequent assessment order dated 30 September, 2020 passed,pending disposal of this Petition, are also quashed and set aside. 6.Petition disposed with no order as to costs. (R.N. LADDHA,J.) (K.R. SHRIRAM, J.) 1 2014 (44) Taxmann.com 304 (Bombay),