Wp-102-2022.Doc v. Taxmann.com 304 (Bombay

Digitallysigned byPURTIPURTIPRASADPRASADPARABPARABDate:2022.01.2911:02:46+0530 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO. 102 OF 2022 Lokhandwala Construction IndustriesPrivate Limited V/s.Deputy Commissioner of Income TaxCircle 4(3)(1), Mumbai and Anr. ….Petitioner …Respondents ---- Dr. K. Shivaram, Senior Advocate a/w Mr. Rahul Hakani for Petitioner.Mr. Suresh Kumar for Respondents. ---- CORAM : K.R. SHRIRAM &N. J. JAMADAR, JJ. DATED : 27[th] JANUARY, 2022 P.C. : 1.At the outset, in the order dated 10[th] January, 2022, inParagraph No.1 the date "08/11/2021" be corrected and replaced with"12/11/2018". The original order to be corrected. Rest of the orderremains unaltered. 2. Paragraph No.1 of the order dated 10[th] January, 2022 reads as under : 1.Dr. Shivram for petitioner states that the notice underSection 148 of the Income Tax Act, 1961 ("the Act") forAssessment Year 2016-2017 has been issued purely on changeof opinion, which is not permissible in law. Dr. Shivram statesthat, for the reasons, reliance has been placed in assessmentrecords and the Return filed by the petitioner along with theprofit and loss account and balance sheet and secondly, anissue raised is regarding the finished stocks ofRs.65,53,57,872/-, which was for unsold flats of two projectsat Kandivali and Bandra and according to respondents, petitioner's has not offered tax under the head income fromhouse property. Dr. Shivram states that the same issue wasraised during the assessment proceedings as could be seenfrom Item No.16 in the annexure to notice dated 8[th] October,2018, issued under Section 142(1) of the Act and petitionerhas replied to, the same vide petitioner's letter dated 8[th]November, 2021. Dr. Shivram states that this issue has notbeen discussed in the assessment order but still relying onAaroni Commercials Ltd. vs. Deputy Commissioner of Income-tax -2(1)1 submitted that once a query has been raised and ithas been replied to, the Assessing Officer is deemed to haveapplied his mind and considered the same even if that issuehas not been discussed in the assessment order. 3. 3.Mr. Suresh Kumar is not disputing the same and naturally hecannot but submits that the Assessing Officer while recording the reasonsfor re-opening the assessment has relied upon two judgments one of DelhiHigh Court and other of Ahmedabad ITAT and therefore, the AssessingOfficer's satisfaction that there has been escapement from assessmentcannot be faulted. 4.We have to note at the outset that the ITAT order is not bindingon this court. Secondly, the judgment/order of the Delhi High Court reliedupon for the reasons for re-opening has been reported in (2013) 213Taxman 0143. Therefore, it is a judgment of 2013 or earlier. Theassessment order in this case has been passed on 15[th] December, 2018 andthe query on this issue has been raised on 8[th] October, 2018 and replied bypetitioner vide its letter dated 12[th] November, 2018. Therefore, theAssessing Officer had benefit of the judgment of the Delhi High Court relied 1 (2014) 44 taxmann.com 304 (Bombay) upon by the Assessing Officer wanting to re-open the assessment but stilldid not find anything wrong in the case made out by petitioner andproceeded to pass the assessment order. 5.In the circumstances, it is quite clear that it is nothing butchange of opinion on the part of the Assessing Officer wanting to re-openthe assessment. The re-opening of assessment based on change of opiniongoes to the root of the matter and as held repeatedly by various courts, isnot permissible. 6. In the circumstances, petition is allowed in terms of prayer clause – (a) which reads as under : 1 (2014) 44 taxmann.com 304 (Bombay) upon by the Assessing Officer wanting to re-open the assessment but stilldid not find anything wrong in the case made out by petitioner andproceeded to pass the assessment order. 5.In the circumstances, it is quite clear that it is nothing butchange of opinion on the part of the Assessing Officer wanting to re-openthe assessment. The re-opening of assessment based on change of opiniongoes to the root of the matter and as held repeatedly by various courts, isnot permissible. 6. In the circumstances, petition is allowed in terms of prayer clause – (a) which reads as under : (a) that this Hon’ble Court may be pleased to issue a Writ ofCertiorari or a Writ in the nature of Certiorari or any otherappropriate Writ, order or direction, calling for the records ofthe Petitioner’s case and after going into the legality andpropriety thereof, to quash and set aside the said (i)reopening Notice dated 31[st] March, 2021 (issued and signedon 8[th] April, 2021), u/s 148 for A.Y. 2016-17 (Exh.A), (ii) theimpugned order dated 10/12/2021 being (Exh. “B”) and (iii)Notice u/s 143(2) dated 29/12/2021 being (Exh. “C”). 7. Petition disposed. (N. J. JAMADAR, J.) (K.R. SHRIRAM, J.)