The Commissioner Of Income Tax,Coimbatore v. M/S.elgi Tread (India) Ltd

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 04.07.2018 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Tax Case (Appeal) Nos.1313 to 1324 and 1326 and 1327 of 2007 T.C.(A) No.1313 of 2007:- The Commissioner of Income Tax,Coimbatore. ... Appellant/respondent in all TC(A) Cases -vs- M/s.Elgi Tread (India) Ltd.,2000, Trichy Road, Singanallur,Coimbatore-641 005. ... Respondent/Appellant in all TC(A) Cases Tax Case (Appeal) filed under Section 260-A of the IncomeTax Act, 1961 against the order of the Income-tax AppellateTribunal “D” Bench, Chennai dated 24.02.2006 passed inI.T.A.No.1286/Mds/2000 for the Assessment Year 1990-91ITA.680/Mds/2000 for the Assessment Year 1993-94 andI.T.A.No.1271/mds/2000 for the Assesment Year 1990-1991 andI.T.A.NO.1272/mds/2000 for the Assessment Year 1992-1993 andI.T.A.NO.1273/mds/2000 for the Assessment year 1993-1994 andI.T.A.NO.1274/mds/2000 for the Assessment year 1994-1995 andI.T.A.NO.1289/mds/2000 for the Assessment year 1994-1995 andI.T.A.NO.1486/mds/2000 for the Assessment year 1991-1992 andI.T.A.NO.1287/mds/2000 for the Assessment year 1992-1993 andI.T.A.NO.1288/mds/2000 for the Assessment year 1993-1994 andI.T.A.NO.1396/mds/2000 for the Assessment year 1992-1993 andI.T.A.NO.1487/mds/2000 for the Assessment year 1995-1996 andI.T.A.NO.1523/mds/2000 for the Assessment year 1991-1992 andI.T.A.NO.1524/mds/2000 for the Assessment year 1995-1996respectively against the order to Commissioner of Income Tax(Appeals) Coimbatore dated 25.10.2000 made in I.T.A.95-C/99-2000dated 25.10.2000, I.T.A.392-C/99-2000 dated 24.07.2000,I.T.A.94-C/99-2000 dated 24.07.2000, I.T.A.90-C/99-2000 dated24.07.2000, I.T.A.93-C/99-2000 dated 29.05.2000, I.T.A.92-C/99-2000 dated 29.05.2000, I.T.A.91-C/99-2000 dated 29.05.2000 andI.T.A.89-C/99-2000 dated 26.05.2000 respectively against theorder passed by the Joint Commissioner of Income Tax, Special Range-I Coimbatore dated 05.10.99 in PAN/GIR.NO.49-502-CX-2236for the Asst year 97-98 dated 25.03.1999 in PAN/GIR.NO.49-502-CX-2236 for the asst year 96-97, dated 05.03.1999 inPAN/GIR.NO.GX-2236/SR-I-CBE for the asst year 95-96, dated05.03.1999 in PAN-GIR.NO.CX-2236/SR-I-CBE for the asst year 94-95, dated 05.03.1999 in PAN/GIR.NO.49-502-CX-2236 for the asstyear 93-94, dated 05.03.1999 in PAN/GIR.NO.49-502-CX-2236 forthe asst year 92-93, dated 05.03.1999 in PAN/GIR.NO.49-502-CX-2236 for the asst year 91-92, and dated 05.03.1999 inPAN/GIR.NO.CX-2236/SR-I/CBE for the assessment year 1990-91respectively. For Appellant : Mr.T.R.Senthil Kumar, in all TC Appelas Senior Standing counsel for Income Tax Department assisted by Mr.S.Rajesh, and Mrs.K.G.Usharani For Respondent : Mr.M.P.Senthil Kumar for in all TC Appellas M/s.Philip George in all TCA Cases COMMON JUDGMENT(Delivered by T.S.Sivagnanam, J.) These appeals, by the Revenue, are directed against thecommon order passed by the Income-tax Appellate Tribunal “D”Bench, (ITAT) Chennai in I.T.A.Nos.1286/2000, 1271/2000,1486/2000, 1523/2000, 1272/2000, 1287/2000, 1396/2000, 680/2002,1273/2000, 1288/2000, 1274/2000, 1289/2000, 1487/2000 and1524/2000 dated 24.02.2006. 2.The appeals have been admitted on the followingsubstantial questions of law: “(1) Whether the Assessing Officer isempowered to reopen an assessment based on asubsequent Supreme Court decision? (2) Whether profits from service charges areincludible in the profits of business for thepurposes of Section 80 HH, 80 I and 80 IA? (3) Whether explanation “baa” to Section 80HHC is applicable for tyre retreating charges? https://hcservices.ecourts.gov.in/hcservices/ (4) Whether the Assessing Officer isentitled to restrict the depreciation of theactual cost by invoking Section 43(1)(3)? 2.The appeals have been admitted on the followingsubstantial questions of law: “(1) Whether the Assessing Officer isempowered to reopen an assessment based on asubsequent Supreme Court decision? (2) Whether profits from service charges areincludible in the profits of business for thepurposes of Section 80 HH, 80 I and 80 IA? (3) Whether explanation “baa” to Section 80HHC is applicable for tyre retreating charges? https://hcservices.ecourts.gov.in/hcservices/ (4) Whether the Assessing Officer isentitled to restrict the depreciation of theactual cost by invoking Section 43(1)(3)? (5) Whether the excise duty and sales taxform part of the turnover for the purpose ofdeduction under Section 80 HHC? (6) Whether the net amount or the otherincome has to be excluded from the profits ofbusiness for the purpose of Section 80 HHC?” 3.In this batch of appeals though six substantialquestions of law have been framed, what we are required todecide is the first question as framed in Tax Case (Appeal)Nos.1313 to 1324 and 1326 and 1327 of 2007, viz., whether theAssessing Officer is empowered to reopen an assessment based ona subsequent Supreme Court decision? 4.The reason for framing the other five substantialquestions of law, is on account of the fact that those questionswere raised by the assessee / Department before the Tribunal.Since the Tribunal decided the question relating to jurisdictionof the officer to reopen the proceedings, both in respect ofreopening of assessment done beyond the period of four years andthose done within the period of four years, the Department hasraised these questions in these appeals. 5.By way of illustration, if we take up T.C.(A) No.1313 of2007, the second question is with regard to whether profits fromservice charges are includible in the profits of business forthe purpose of Sections 80 HH, 80 I and 80 IA of the Income TaxAct, 1961 (hereinafter referred to as “the Act”). This questionwas raised by the assessee in their appeal before the Tribunaland the first contention was challenging the reopening. Sincethe assessee succeeded on the issue relating to reopening beforethe Tribunal, the Tribunal did not go into the issue pertainingto Sections 80 HH and 80 I of the Act. Therefore, the Revenuehas raised this question before us in these appeals. Similar isa position with regard to other appeals as well. 6. A tabulated statement has been prepared byMr.M.P.Senthil Kumar, learned counsel for the assessee, whichmakes things clear and for easy reference, the same is quotedhereunder:- https://hcservices.ecourts.gov.in/hcservices/ 1995-96A.Y.1990-911991-921992-931993-941994-951313/131513201326/13161321/01323/1314/1318/Reliance# IssuesT.C.A. No.1317/071322/071319/07 1 1327/0707/07/0707/077070707placed on1286/127114861523/12721287/01396/680/1274/1487/0I.T.A. No.1273/001288/001289/001524/00 00/00/0000/0000002000Beyond 4Reopening onyearsbasisofProviso to1? Q? Q.subsequent11? Q 1? Q 1? Q 1? Q 1section 147Supreme CourtappliesdecisionChange ofopinionServiceDoes not ariseCharges are? Q? Qincludiblein? Q2? Q 22? Q 2? Q 2At pg 133 of2profitsof2[80H[80HH,Typed set.businessthe purpose offor[80HH& 80I][80HH &[80HH& 80I]80I &H,80I &80IA][80HH, 80I& 80IA]TheTribunalSections 80HH,80I]80IA]annulledthe80I and 80IAreassessmentExplanationproceedings and“baa” to sectionhad not gone into380HHCother grounds onwhether? Q 3? Q 3? Q 3meritsin.applicable forAssessee’s andTyre RetreadingdismissedChargesDepartmentRestrictappeals without4Depreciation ofgoing into any of.actual cost byinvoking 43(1)? Q 4the other groundsraised.(3)ST ED receiptsto be excludedin TTO –580HHC.[@66 $2 in TCA860 to 863/07Typed Set]Net amount ofother income? Q? Q? Qhas to be? Q? Q666? Q 66excluded from66 [80H? Q 6.the profits ofbusinessfor[80HH & [80HH] [80HHC & [80HH][80HHC]H, 80I&[80HHC, 80HH & 80IA]80I]80I]the purpose of80IA]Section 80HHC 7.Since the substantial questions of law, to be decided inall the appeals, are identical and the factual position is alsoidentical, we take up for consideration the facts relating tothe assessment year 1990-91. 8.Before we proceed further, we observe that the appealsare in two batches, viz., one set of cases are related to theassessment years 1990-91 to 1992-93, where the reopening hasbeen done beyond four years and so far as the assessment years1993-94 to 1995-96 are concerned, the assessments have beenreopened within four years. 9. For the assessment year 1990-91, the assessee filedthe return of income on 31.12.1990 declaring taxable income ofRs.1,41,81,020/- and profit under Section 115J, the bank profitis shown as Rs.98,20,860/-. Intimation under Section 143(1)(a)of the Act was sent on 25.06.1991 accepting the returned incomewithout making any adjustments. The assessee filed revisedreturn on 31.12.1992 revising the income of Rs.1,38,08,720/-.In the said revised return, the assessee claimed additionalbenefit under Section 80 I of the Act. 10.According to the assessee, certain franchises failed torun the units and accordingly, the main company took over thoseconcerns which produced retreated tyres. According to theassessee, deduction under Section 80 I of the Act is availableeven in respect of these units. However, at the time ofassessment, it was pointed out to the assessee that nocognizance could be taken to the revised return, as no revisedreturn could be filed beyond one year from the end of theassessment year 1990-91. Accordingly, the revised return wasignored. The assessee submitted another letter dated22.01.1993, wherein revised claim of Section 80 I of the Act wassubmitted in respect of which notice under Section 143(2) of theAct was issued to the assessee to produce details. Afterdiscussion, the assessment was completed and the benefit wasextended to the assessee. These assessments were reopenedpursuant to a notice under Section 148 of the Act dated08.08.1997. 11.Both the Department as well as the assessee have filedpaper books containing the assessment orders, Orders-in-Appealetc., but the paper books do not contain the reasons forreopening required to be recorded in terms of Section 147 of theAct. Therefore, we perused the revised assessment orders dated05.03.1999 for the assessment years 1990-91. The AssessingOfficer states that the original assessment under Section 143(3) https://hcservices.ecourts.gov.in/hcservices/ of the Act was completed on 18.03.1993 and the same was revisedon 21.07.1993 and to consider certain points, the assessment wasreopened with the prior permission of the Commissioner of IncomeTax by issue of notice under Section 148 of the Act on08.08.1997. Thus, the respondent / Assessing Officer has notstated as to what are the reasons for reopening the assessmentand how he formed an opinion that income chargeable to tax hasescaped assessment. Therefore, this is a substantial ground onwhich the proceedings could have been terminated. 12.Nevertheless, the assessee participated in theproceedings and submitted their response. The Assessing Officerwhile completing the revised assessment under Section 147, hasallowed the deductions under Sections 80 HH and 80 I of the Act.The Revenue, preferred appeal as against the said order beforethe Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A)noted that the main ground taken is with regard to the validityof the reopening and submitted that despite request from theappellant, the Assessing Officer did not furnish reasons forissuing the notice for reopening. Further, the assessee statedthat there was no failure on their part to disclose any materialand it was a change of opinion and they relied as many as 18judgments of the Hon'ble Supreme Court and the High Courts insupport of their stand. 13.The CIT(A) after considering the submissions on eitherside, held that this Court in the case of CIT vs. MaduraiPandian Engineering Corporation Ltd reported in 239 ITR 375(Mad.) has held that retreading of tyres does not amount tomanufacture. Therefore, if the correct provision of law wasignored in the original assessment, the same can be reopened.After rendering such finding, the CIT(A) also proceeded to takea decision on the merits of the assessment. The assessee filedappeals before the Tribunal, where the common question wasregarding the validity of the reopening of the assessments,within the period of four years and beyond the period of fouryears. Insofar as the relief granted by the CIT (A) to theassessee, the Revenue preferred appeals before the Tribunal. 14.The Tribunal after taking note of the factual position,first took up for consideration as to whether the AssessingOfficer has framed the assessment ignoring the decision of theApex Court in the case of P.C.Cherian vs. Barfi Devi reported inAIR 1980 SC 86. After taking note of the submissions, the ITATheld that the assessment has to be reopened on the basis of thedecision of the Hon'ble Supreme Court in the case of P.C.Cherian(supra) and the decision has been discussed by this Court in thecase of Madurai Pandian Engineering Corporation Ltd (supra), wherein it has been noted that one of the issues arose waswhether retreading of tyres would amount to manufacture underSection 160 of the Transfer of Property Act and this clearlyshows that the decision does not relate to deduction underSections 80 HH and 80 I of the Act. In this regard, theTribunal relied on the decisions of the Apex Court in the casesof CIT vs. Sun Engineering Works Pvt. Ltd. reported in 198 ITR297 (SC) and Padmasundara Rao (Decd.) and Others vs. State ofTamil Nadu reported in 255 ITR 147 (SC). Therefore, it heldthat it cannot be said that the case of P.C.Cherian (supra) wasapplicable to cases arising under Sections 80 HH and 80 I of theAct in the case of tyre retreading business. 15.Further, the Tribunal agreed with the submissions ofthe counsel for the assessee that from a perusal of the decisionin Madurai Pandian Engineering Corporation Ltd (supra), thatreferences were made by the Department in Tax Case Nos.1820 to1821 of 1986, which means, the issue was decided in favour ofthe assessee by the Tribunal and following those decisions, theassessee has claimed deduction under Sections 80 HH and 80 I ofthe Act. The Tribunal held that though a case can be reopenedunder Section 147/148 when a decision is ignored by theAssessing Officer in the light of the decision of the Hon'bleSupreme Court in ITO vs. Sharadbhai M. Lakhani reported in 243ITR 1 (SC), but the same is not applicable to the cases on hand,because the decision itself was rendered under a different Act.Further, it held that Sharadbhai M. Lakhani (supra) was based onthe decision of the Supreme Court in A.L.A. Firm vs. CITreported in 189 ITR 285, and accordingly, distinguished thedecision in those cases. 16.The Tribunal also referred to the decisions in thecases of Parashuram Pottery Works Co. Ltd. vs. ITO reported in106 ITR 1 (SC); Calcutta Discount Co. Ltd. vs. ITO reported in41 ITR 191; and the decision of this Court in Fenner India Ltd.vs. DCIT reported in (2000) 241 ITR 627 (Mad.) and afterreferring to Section 147 as well as the decision in the case ofCIT vs. Kelvinator of India Ltd. reported in 256 ITR 1, heldthat the reopening was not sustainable and the reopening wasmere change of opinion. 17.Mr.T.R.Senthil Kumar, learned Senior Standing Counselfor the Revenue contended that Section 147 of the Act empowersAssessing Officer to reopen the assessment as well as toreassess such income and recompute the loss or depreciationallowance or any other allowance, as the case may be. 17.Mr.T.R.Senthil Kumar, learned Senior Standing Counselfor the Revenue contended that Section 147 of the Act empowersAssessing Officer to reopen the assessment as well as toreassess such income and recompute the loss or depreciationallowance or any other allowance, as the case may be. 18.Referring to Explanation 2, in Section 147, it issubmitted that Clause (c)(iii) provides that when there isexcessive relief granted under the Act, the Assessing Officer isjustified in reopening the assessment. The learned counsel, tosupport his contention, relied upon the decision of the Hon'bleSupreme Court in the case of Honda Siel Power Products Ltd. vs.DCIT reported in [2012] 20 taxmann.com 5 (SC), wherein theassessee was permitted to raise all contentions with regard tothe amount being offered for tax as well as its contention underSection 14A of the Act. 19.Relying on the decision of the Hon'ble Supreme Court inGirilal & Co. vs. Income-tax Officer reported in [2016] 75taxmann.com 172 (SC), it was submitted that in the said case,the Hon'ble Supreme Court held that there was no true disclosureby the assessee and the Assessing Officer was justified inreopening the assessment. 20.Mr.M.P.Senthil Kumar, learned counsel appearing for theassessee submitted that the Tribunal rightly held that thereopening was based on change of opinion. Further, it waspointed out that the decision in the case of P.C.Cherian (supra)arose under the provisions of the Transfer of Property Act andthe Calcutta High Court in the case of Addl.CIT vs. Kalsi Tyrereported in (1981) 131 ITR 0636 (Cal.), held that retreadingactivitiy is processing akin to an industrial or manufacturingactivity. 21.In the case of Sixth Income Tax Officer vs. General'sNew Tread reported in 13 ITD 460 (SB), the Bangalore Bench ofthe ITAT held that the assessee, who produced an article byretreading, was entitled to investment allowance. It issubmitted that the appeals filed before this Court in the caseof Madurai Pandian Engineering Corporation Ltd (supra), are bythe Revenue and those appeals were filed in the year 1986 anddecided by this Court in favour of the Revenue on 02.03.1998.Thus, it is submitted that till the Division Bench decided thesubstantial question in favour of the Revenue in the case ofMadurai Pandian Engineering Corporation Ltd (supra), on02.03.1998, the decision of the Tribunal held the field, whichwas clearly in favour of the assessee. 22.Further, it is submitted that reopening could not havebeen made based upon the decision of the Division Bench, whichwas rendered subsequently. In support of such contention,reliance was placed on the decisions in the case of CIT vs. BaerShoes (India) (P). Ltd. reported in (2011) 331 ITR 0435 (Madras) https://hcservices.ecourts.gov.in/hcservices/ and in the case of DCIT vs. Simplex Concrete Piles (India) Ltd.reported in [2013] 358 ITR 129 (SC). 23.Heard the learned counsels for the parties andcarefully perused the materials placed on record. 22.Further, it is submitted that reopening could not havebeen made based upon the decision of the Division Bench, whichwas rendered subsequently. In support of such contention,reliance was placed on the decisions in the case of CIT vs. BaerShoes (India) (P). Ltd. reported in (2011) 331 ITR 0435 (Madras) https://hcservices.ecourts.gov.in/hcservices/ and in the case of DCIT vs. Simplex Concrete Piles (India) Ltd.reported in [2013] 358 ITR 129 (SC). 23.Heard the learned counsels for the parties andcarefully perused the materials placed on record. 24.The short question, which falls for consideration, iswhether the reopening of the assessments both within four yearsand beyond four years could have been done for the reasonsassigned by the Revenue. We are required to take a decision inrespect of the other substantial questions of law, afterdeciding the first question and if this question is answered infavour of the Revenue, then we may be required to examine theother substantial questions of law. However, if we answer thesaid question in favour of the assessee, then nothing furtherremains to be decided in these appeals. As pointed out in thepreceding paragraphs, the Assessing Officer, while reopening theassessment, has not disclosed the reasons for reopening. Thisis evident from the assessment order dated 05.03.1999, whichonly states that the assessment was reopened to consider certainpoints with prior permission of the Commissioner of Income Tax.Thus, the basic requirement for recording reasons to believethat income chargeable to tax has escaped assessment is absentin the instance case, which would be sufficient to hold that thereopening proceedings are wholly without jurisdiction. 25.Having held so, we proceed to consider the otherissues, which were raised by the learned counsels. 26.The learned Senior Standing Counsel appearing for theRevenue argued that in terms of Section 147 of the Act, theAssessing Officer has power to reassess the income and he isentitled to recompute the loss of the depreciation allowance orany other allowance, as the case may be and it is submitted thatthe case on hand clearly falls in Clause (c)(iii) of Explanation2 of Section 147 of the Act. 27.In our considered view, the power to assess or reassessor recompute the loss or depreciation allowance or any otherallowance could be done only if the Assessing Officer has reasonto believe that any income chargeable to tax has escapedassessment for any assessment year. Therefore, Explanation 2cannot be read in isolation and it has to be read harmoniouslywith the powers under Section 147 of the Act including theproviso under the said Section. Therefore, we are unable toaccept the submission of the learned Senior Standing Counsel forthe Revenue. 28.With regard to the decision in the case of Honda SielPower Products Ltd. (supra), we find that the said decision iswholly inapplicable to the facts and circumstances of thepresent case. In Girilal & Co. (supra), the issue was withregard to valuation of a property and the Court found that theassessee failed to truly disclose the exact size of the plot andthis information was available only in the valuation report.Therefore, the Court held that Explanation 2(c)(iv) of Section147 of the Act will apply. The said decision can have noapplication to the facts of the present case, as there is noallegation, that the assessee withheld the information from theAssessing Officer. 28.With regard to the decision in the case of Honda SielPower Products Ltd. (supra), we find that the said decision iswholly inapplicable to the facts and circumstances of thepresent case. In Girilal & Co. (supra), the issue was withregard to valuation of a property and the Court found that theassessee failed to truly disclose the exact size of the plot andthis information was available only in the valuation report.Therefore, the Court held that Explanation 2(c)(iv) of Section147 of the Act will apply. The said decision can have noapplication to the facts of the present case, as there is noallegation, that the assessee withheld the information from theAssessing Officer. 29.One more submission, which was made, was that theAssessing Officer without application of mind, had granted thebenefit of deduction and therefore, the Revenue had to fileappeals before the CIT(A). On a reading of the assessmentorders passed under Section 143(3) dated 18.03.1993, it is clearthat there has been discussion between the assessee and theAssessing Officer and all materials have been placed before himand then the assessment has been completed granting benefit.Therefore, the order of assessment cannot not be stated to be anorder without application of mind. 30.Thus, we come to the last and most important questionto be decided, as to whether reopening of an assessment could bedone based upon the decision in the case of Madurai PandianEngineering Corporation Ltd (supra). As mentioned by usearlier, the decision was rendered by the Division Bench of thisCourt on 02.03.1998. Till such date, the decision of theTribunal was in favour of the assessee. Apart from that, theCalcutta High Court in Kalsi Tyre (supra) has decided thatbusiness of retreading tyres is an industrial company within themeaning of Section 2(6)(d) of the Finance Act, 1968. The saiddecision was rendered in the year February, 1981. Thus, thelaw, which stood as on 02.03.1998, was in favour of theassessee. Notices, under Section 148 of the Act, were issued on08.08.1997. Thus, the notices for reopening were issued priorto the decision in the case of Madurai Pandian EngineeringCorporation Ltd (supra) and on the date when the notices wereissued, the law was clearly in favour of the assessee andretreading of tyres was held to be a manufacturing activity.Based on the decision in Madurai Pandian Engineering CorporationLtd (supra), reopening could not have been done. 31.The Hon'ble Supreme Court in Simplex Concrete Piles(India) Ltd. (supra), held that the subsequent reversal of thelegal position by the judgment of the Hon'ble Supreme Court doesnot authorise the Department to reopen the assessment, whichstood closed on the basis of law, as it stood at the relevantpoint of time. 32.In Baer Shoes (supra), it was held that the judgmentrendered by the Supreme Court is an expression of opinion on theinterpretation of statute. The power under Section 147 of theAct will have to be invoked by the Assessing Officer inaccordance with the said provision and merely because a judgmenthas been rendered, the same cannot be a reason for reopening theassessment under Section 147 of the Act. 33.As pointed out by the Hon'ble Supreme Court inParashuram Pottery Works Co. Ltd. (supra), it has to be kept inmind that policy of law is that there must be a point offinality in all legal proceedings and that stale issues shouldnot be reactivated and that lapse of time must induce repose inand set at rest judicial and quasi-judicial controversies as itmust in other spheres of human activities. 33.As pointed out by the Hon'ble Supreme Court inParashuram Pottery Works Co. Ltd. (supra), it has to be kept inmind that policy of law is that there must be a point offinality in all legal proceedings and that stale issues shouldnot be reactivated and that lapse of time must induce repose inand set at rest judicial and quasi-judicial controversies as itmust in other spheres of human activities. 34.As held by this Court in the case of Fenner India Ltd.(supra), in order to reopen an assessment after expiry of fouryears from the end of relevant assessment year, the AssessingOfficer must necessarily record not only his reasonable beliefthat income has escaped assessment, but also the default orfailure of assessee to disclose fully and truly all materialfacts; notice issued under Section 148 of the Act after expiryof four years cannot be sustained as escapement of income, ifany, is not on account of any failure on the part of assessee todisclose the material facts fully and truly. The abovereasoning will be equally applicable for reopening ofassessments within four years. In this regard, it is beneficialto refer to the decision in the case of Kelvinator of India Ltd.(supra), wherein it was held that the Assessing Officer haspower to reopen the assessment under Section 147 of the Actprovided he has reason to believe that income has escapedassessment and there is tangible material to come to theconclusion that there is escapement of income; mere change ofopinion cannot per se be reason to reopen. 35.In the light of the above discussion, we hold that thereopening proceedings was wholly without jurisdiction and we https://hcservices.ecourts.gov.in/hcservices/ affirm the view taken by the Tribunal and accordingly, dismissall the tax cases (appeals) filed by the Revenue by answeringthe first substantial question of law as framed above in favourof the assessee and hold that the Assessing Officer was notempowered to reopen the assessment for all the assessment years.Consequently the other substantial questions of law as framedare left open. In the result, the tax cases (appeals) are dismissed. Nocosts. Sd/- Assistant Registrar(CS VI) //True Copy// Sub Assistant RegistrarabrTo1.The Income-tax Appellate Tribunal “D” Bench, Chennai2.The Commissioner of Income Tax(Appeals)Coimbatore.3.The Joint Commissioner of Income TaxSpecial Range-ICoimbatore.4.The Assistant Registrar,Income Tax Appellate Tribunal,Rajaji Bhavan III Floor,Besant Nagar,Chennai-90 5.The Commissioner of Income Tax,Coimbatore. +1cc to Philip George, Advocate sr.no.43775+1cc to Mr.T.R.Senthilkumar, Advocate sr.no.43876 T.C.(A) Nos.1313 to 1324 & 1326 and 1327 of 2007 gmr(co)nr 06/08/2018