Wp/1584/2022 Of Sterlite Technologies Limited v. The Deputy Commission Of Income Tax Circle-3(4) And 2 Ors

Sterlite Technologies LimitedGodrej Millenium, 9, KoregaonPark Rd, Vasani Nagar,Koregaon Park, Pune,Maharashtra – 411 001.….Petitioner V/s.1. The Deputy Commission ofIncome Tax, Circle 3(4) Aayakar Bhavan, M.K. Road,Mumbai – 400 020. 2. The Additional Commissionerof Income Tax Range 3(4),Aayakar Bhavan, M.K. Road,Mumbai – 400 020. 3. The Union of IndiaThrough the Secretary,Government of India,Ministry of Finance,New Delhi – 110 001. …Respondents ---- Mr. P.J. Pardiwalla, Senior Advocate a/w Ms. Jasmin Amalsadvala i/b Mint &Confreres for Petitioner. Mr. Akhileshwar Sharma a/w Ms. Shilpa Goel for Respondents-Revenue. ---- CORAM : K.R. SHRIRAM & FIRDOSH P. POONIWALLA, JJ. DATED : 7[th] AUGUST 2023 ORAL JUDGMENT : (PER : K.R. SHRIRAM, J.) 1.With the consent of counsel this petition is taken up for disposal at this stage itself since pleadings are completed. Petitioner is primarily impugning a notice dated 27[th] March 2021 issued under Section 148 of the Income Tax Act, 1961 (the Act) forAssessment Year 2016-17 where it is alleged that there are reasons tobelieve that petitioner’s income chargeable to tax for Assessment Year 2016-17 has escaped assessment within the meaning of Section 147 of the Act.The reasons to believe can be found in communication dated 17[th] November 2021 addressed to petitioner and the same reads as under : The assessee has filed the e-return on 29.11.2016 declaring totalincome at Rs.161,79,93,020/- computed under normal provision ofthe Act and Book Profit of Rs.219,56,07,298/- u/s 115JB of theAct. This case was selected for scrutiny and assessment for A.Y.2016-17 was completed on 21.12.2018 after scrutiny and assessedincome of Rs.176,32,00,710 under normal provision of the Act andBook profit at Rs.225,45,68,489 u/s 115JB of the Act. 2. Subsequently on perusal of the records it was observed that theassessee had purchased 100% shares of M/s ETPL on 22[nd]September 2015 for a total purchase consideration of Rs.187.35crore and immediately thereafter on 29[th] September 2015, M/sETPL merged with the assessee. Keeping in view the acquisition ofall assets and liabilities of M/s ETPL, the amount paid in excessthereof was determined as Rs.148.19 crore and the same wastreated as goodwill and depreciation thereon of Rs.38,15,17,889was claimed by the assessee @25% treating it as intangible asset. Keeping in view the above mentioned provisions, thedepreciation so claimed was not allowable. Further it was relevantto be mentioned that in a similar case of M/s Johnson and JohnsonLtd. for AY 2015-16, the depreciation on Goodwill had beendisallowed concluding that purchase consideration paid for buyingthe shares were high and subsequent amalgamation was towardscreating spurious goodwill in the books of the assessee. Hence from the point of consistency also it was required to bedisallowed, which was not done in the assessment. This resulted inunder assessment to the same extent. 2.1 Therefore I am of the view that income to the extent ofamount of Rs.38,15,17,889/- as explained above, has escapedassessment. 3.Petitioner had during Financial Year 2015-16 acquired the entire paid up share capital of one Elitecore Technologies Pvt. Ltd. (ETPL) from third party seller with discharge of fair value consideration.Thereafter, petitioner applied for amalgamating ETPL with itself vide ascheme of amalgamation which was sanctioned by the Hon’ble Gujarat HighCourt and High Court Bombay vide order dated 21[st] March 2016 and 7[th]April 2016 respectively with effect from 29[th] September 2015. Pursuant tothe amalgamation and in accordance with the scheme of amalgamation asapproved by two High Courts, petitioner recognized all the assets andliabilities transferred by ETPL to it on their respective book value andrecognized goodwill of Rs.148.19 Crores in its financial statements. It is theclaim of petitioner’s depreciation on this goodwill which is the subjectmatter of the notice impugned in the petition. from third party seller with discharge of fair value consideration.Thereafter, petitioner applied for amalgamating ETPL with itself vide ascheme of amalgamation which was sanctioned by the Hon’ble Gujarat HighCourt and High Court Bombay vide order dated 21[st] March 2016 and 7[th]April 2016 respectively with effect from 29[th] September 2015. Pursuant tothe amalgamation and in accordance with the scheme of amalgamation asapproved by two High Courts, petitioner recognized all the assets andliabilities transferred by ETPL to it on their respective book value andrecognized goodwill of Rs.148.19 Crores in its financial statements. It is theclaim of petitioner’s depreciation on this goodwill which is the subjectmatter of the notice impugned in the petition. 4.Petitioner filed its return of income on 29[th] November 2016declaring a total income under normal provisions of the Act atRs.1,61,79,93,020/- and book profit at Rs.2,19,56,07,298/- under Section115 JB of the Act, inter alia, claiming depreciation of Rs.38,15,17,889/- onthe goodwill. Petitioner has disclosed this aspect of claiming depreciationon goodwill pursuant to the amalgamation in the documents filed alongwiththe returns. 5.Petitioner’s case was selected for scrutiny and notice dated 19[th]September 2017 under Section 143(2) of the Act was issued. Petitionerfiled its response vide letter dated 26[th] September 2017 and furnished all the details called for. On 18[th] September 2018 a detailed questionnaire alongwith notice under Section 142 (1) of the Act was issued to petitioner.Petitioner responded vide its letters dated 22[nd] October 2018 and two lettersboth dated 1[st] November 2018. A fresh notice dated 14[th] November 2018under Section 142(1) of the Act was issued enquiring details of theamalgamation, satisfaction of conditions under Section 72A of the Act andspecifically seeking details of valuation and other documentary evidenceswhich resulted into goodwill. Petitioner was also handed over a list ofreasons based on which petitioner’s return for Assessment Year 2016-17 wasselected for scrutiny under CASS. The list included details relating toamalgamation and required petitioner to address whether tax aspectsrelated to intangible assets have been considered in the return of income.In response, petitioner, by letter dated 19[th] November 2018, filed the courtorders approving amalgamation as well as the scheme for amalgamationand also explained the basis of recording of goodwill and claim ofdepreciation thereon. 6.By a letter dated 22[nd] November 2018 petitioner gave moredetailed submissions on the valuation and reporting of assets acquiredpursuant to the amalgamation including goodwill and claim for depreciationthereon. This was further reply to the notice dated 14[th] November 2018 andpetitioner also cited decisions of the Hon’ble Apex Court as well as theBombay High Court. 7.During hearing on 6[th] December 2018, it is stated in thepetition, Respondent No.1 specifically asked petitioner to justify its claim fordepreciation on goodwill arisen as a result of the amalgamation of ETPLwith itself. A letter dated 13[th] December 2018 recording what transpiredduring the earlier hearing was also submitted. As there were certain furtherqueries raised, petitioner submitted another letter dated 13[th] December2018 providing further details. In short a detailed enquiry was conductedinto by Respondent No.1 before the Assessment Order dated 21[st] December2018 came to be passed. 8.During the assessment proceedings another issue which caughtthe Assessing Officer (A.O.)’s attention was the Employee Stock OptionExpenses of Rs.13.46 Crores which petitioner had claimed. Petitioner wascalled upon to explain why that should not be disallowed as was done inearlier years. In the Assessment Order the A.O. has disallowed this ESOPexpenses. 8.During the assessment proceedings another issue which caughtthe Assessing Officer (A.O.)’s attention was the Employee Stock OptionExpenses of Rs.13.46 Crores which petitioner had claimed. Petitioner wascalled upon to explain why that should not be disallowed as was done inearlier years. In the Assessment Order the A.O. has disallowed this ESOPexpenses. 9.Subsequently, petitioner received the impugned notice dated27[th] March 2021 and also reasons to believe that income has escapedassessment also. Petitioner filed its objections to reopening which wasrejected by an order dated 24[th] January 2022 which is also impugned in thispetition. 10.Mr. Pardiwalla submitted that though the proposed reopening iswithin four years and there are judgments to the effect that the reasonsPurti Parab to reopen should only contain tangible material, if the reason to reopen isbased on change of opinion even such a notice has to be quashed and setaside. Mr. Pardiwalla submitted that jurisdiction to reopen an assessmentunder Section 148 read with Section 147 of the Act can be assumed only onthe belief of the A.O. Respondents have failed to appreciate the fact that theclaimfor depreciation on goodwill was enquired into during the originalassessment proceedings and the A.O. being satisfied with the explanationoffered has allowed the claim for depreciation. Mr. Pardiwalla submittedthat just because the Assessment Order did not refer to this issue in theAssessment Order does not mean it has not been considered. Relying on thejudgment of this court in Aroni Commercials Ltd. vs. Deputy Commissionerof Income Tax 2(1) [1], Mr. Pardiwalla submitted that once the query is raisedduring the assessment proceedings and assessee has replied to it, it followsthat the query raised was a subject of consideration of the A.O. whilecompleting the assessment and it is not necessary that the Assessment Ordershould contain reference and/or discussion to disclose its satisfaction inrespect of the query raised. Mr. Pardiwalla also submitted that even readingthe reasons recorded for reopening clearly indicates that reopening ismerely on the basis of change of opinion of the A.O. from that held earlierduring the course of assessment proceedings and this change of opiniondoes not constitute justification and/or reasons to believe that incomechargeable to tax has escaped assessment. 1 (2014) 44 taxmann.com 304 (Bombay) 11.Mr. Sharma submitted relying on Export Credit GuaranteeCorporation of India Ltd. vs. Additional Commissioner of Income Tax [2] thatwhen the A.O. has tangible material to come to the conclusion that thereis an escapement of income from assessment, the power to reopen can beexercised. The reason to believe means a cause or justification. At the stagewhen the A.O. reopens an assessment, it is not necessary that the materialbefore the court should conclusively prove or establish that income hasescaped assessment. A reason to believe at the stage of reopening is all thatis relevant. Mr. Sharma also submitted that Division Bench of this court inExport Credit Guarantee Corporation of India Ltd. (supra) has held that thetest to be applied is whether there is tangible material when an assessmentis sought to be reopened within a period of four years of the end of therelevant assessment year, what is tangible material is something which is notillusory, hypothetical or a matter of conjecture. There is nothing to indicatethat what has been raised is illusory or hypothetical or a matter ofconjecture. Mr. Sharma also submitted that in this case there is no changeof opinion as there is no discussion on the issue in the Assessment Orderand only the primary details were filed by assessee on the issue, no findingeither positive or negative can be said to have been arrived at during thecourse of original assessment proceedings. Hence, there is no question ofchange of opinion. In our view, this judgment is distinguishable in as much as in 2 (2013) 30 taxmann.com 211 BOM In our view, this judgment is distinguishable in as much as in 2 (2013) 30 taxmann.com 211 BOM Export Credit Guarantee Corporation of India Ltd. (supra) the A.O. did notseek any response/enquiry into the claim made by assessee where as in thefacts of the present case, respondent has not only considered the factualaspects surrounding recording of goodwill but also delved into the detailsregarding the legal aspects of claim of depreciation on such goodwill. 12.Mr. Sharma also submitted that even though the reopeningnotice has been issued pursuant to objections raised by audit during revenueaudit, A.O. has formed his own opinion and only after being satisfied thatincome chargeable to tax has escaped assessment the A.O. recommendedreopening of assessment. 13.In our view, the impugned notice issued under Section 148 ofthe Act is not sustainable and therefore it has to be quashed and set aside.The reasons to reopen itself indicates that it is a clear change of opinion.We say this because in Paragraph No.2 of the reasons quoted above, the A.O.says “………….Keeping in view the above mentioned provisions, thedepreciation so claimed was not allowable………………” . Therefore theA.O. accepts that in the original Assessment Order depreciation claim wasallowed and by way of change of his opinion, he proposed to reopen. 14.Moreover, it also indicates non application of mind in as muchas in the reasons for reopening it is stated “……..… Keeping in view the above mentioned provisions ……..……..”. There are no provisions mentioned in the reasons above this portion. That also indicates non application of mind. 15.Further as regards the audit objections, in Paragraph No. 18 of the petition, petitioner states as under : “The Petitioner is under a bone fide belief that the ImpugnedNotice has been issued pursuant to objections raised by audit partyduring revenue audit to which the Respondent No.1 had respondeddefending the Assessment Order as passed, and it was only on theinsistence of the audit party that the Respondent No.1 wascompelled to replicate the audit objection in the form of reasonsand issue the Impugned Notice. In the affidavit in reply filed through one Dr. Deepak Shukla affirmed on 12[th] April 2022 respondents do not deny the allegations of petitioner, but state in Paragraph No.17 as under : 17. I say that para 18 of the petition pertains to objection in theform of reasons raised by audit party during revenue audit. In thiscase, the objections raised by the Audit was duly examined by theAssessing Officer with reference to the particular filed during theassessment proceedings. The Assessing Officer has formed his ownopinion and only after being satisfied that income chargeable to taxhas escaped assessment, the Assessing Officer recommended forreopening the assessment. It is only after being satisfied, thereasons for reopening of assessment was recorded and belief wasformed that income to that extent has escaped assessment. 16.Further in the objections to the proposed reopening filed vide communication dated 15[th] December 2021, petitioner in Paragraph No.5.5 states as under : 5.5 The present reassessment proceeding is initiated pursuant toaudit objection which has been responded by the then learned AOin favour of the Assessee. Considering the same, the Assesseesubmits that audit objection cannot be considered as the valid ground for initiating reassessment proceedings and initiationshould be based on the independent assessment of the assessingofficer. In this regard, reliance is placed on the decision of theHon’ble Supreme Court in case of Indian & Eastern NewspaperSociety vs CIT (supra). Accordingly, re-assessment proceeding isbad in law and should be dropped. In the order dated 24[th] January 2022 disposing objectionswhich is also impugned in the petition, respondent does not deny that there-assessment was initiated pursuant to audit objections or that it has beenresponded by the then A.O. in favour of assessee. ground for initiating reassessment proceedings and initiationshould be based on the independent assessment of the assessingofficer. In this regard, reliance is placed on the decision of theHon’ble Supreme Court in case of Indian & Eastern NewspaperSociety vs CIT (supra). Accordingly, re-assessment proceeding isbad in law and should be dropped. In the order dated 24[th] January 2022 disposing objectionswhich is also impugned in the petition, respondent does not deny that there-assessment was initiated pursuant to audit objections or that it has beenresponded by the then A.O. in favour of assessee. 17.As held in Indian & Eastern Newspaper Society vs.Commissioner of Income Tax[3], in every case the Income Tax Officer mustdetermine for himself what is the effect and consequences of the lawmentioned in the audit note and whether in consequences of the law whichhas come to his notice he can reasonably believe that income had escapedassessment. The basis of his belief must be the law of which he has nowbecome aware. The opinion rendered by the audit party in regard to thelaw cannot, for the purpose of such belief, add to or colour the significanceof such law. Therefore, the true evaluation of the law in its bearing on theassessment must be made directly and solely by the Income Tax Officer. 18.This court in Sterling and Wilson (P) Ltd. vs. AssistantCommissioner of Income-tax, Circle 14(3)(2), Mumbai[4] while consideringthe Indian & Eastern Newspaper Society (supra) held in Paragraph No.8 of the said judgment which reads as under : 3 (1979) 2 Taxman 197 (SC) 4 (2022) 135 taxmann.com 216 (Bombay) 8. In reply, Petitioner, by its letter dated 07-09-2016, providedthe details. Petitioner, in its statement giving details ofdisallowances made, also has stated that for AY 2012-13 and AY2013-14, there was disallowance on account of depreciation ofgoodwill. Notwithstanding that the Assessing Officer has alloweddepreciation of goodwill for AY 2014-15. As held by Apex Court inthe case of Indian & Eastern Newspaper Society, New Delhi v. CIT(1979) 2 Taxman/197/119 ITR 996 even if it is an error that theAssessing Officer discovered, still an error discovered on a re-consideration of the same material does not given him power to re-open. When the primary facts necessary for assessment are fullyand truly disclosed, the Assessing Officer is not entitled on changeof opinion to commence proceedings for reassessment. Even if theAssessing Officer, who passed the assessment order, may haveraised too many legal inferences from the facts disclosed, on thataccount the Assessing Officer, who has decided to reopenassessment, is not competent to reopen assessment proceedings.Where on consideration of material on record, one view isconclusively taken by the Assessing Officer, it would not be open toreopen the assessment based on the vary same material with a viewto take another view. 19.As held by the Hon’ble Apex Court in case of Indian & Eastern Newspaper Society (supra), even if it is an error that the A.O. discovered,still the error discovered on a reconsideration of the same material does notgive him power to reopen the assessment. Though the primary factsnecessary for assessment are fully and truly disclosed, the A.O. is notentitled on change of opinion to commence proceedings for reassessment.Even if the A.O. who passed the assessment order, may have raised toomany legal inferences from the facts disclosed, on that account the A.O.,who has decided to reopen the assessment, is not competent to reopenassessment proceedings. Where on consideration of material on record, oneview is conclusively taken by the A.O., it would not be open to reopen theassessment based on the very same material with a view to take anotherview. Newspaper Society (supra), even if it is an error that the A.O. discovered,still the error discovered on a reconsideration of the same material does notgive him power to reopen the assessment. Though the primary factsnecessary for assessment are fully and truly disclosed, the A.O. is notentitled on change of opinion to commence proceedings for reassessment.Even if the A.O. who passed the assessment order, may have raised toomany legal inferences from the facts disclosed, on that account the A.O.,who has decided to reopen the assessment, is not competent to reopenassessment proceedings. Where on consideration of material on record, oneview is conclusively taken by the A.O., it would not be open to reopen theassessment based on the very same material with a view to take anotherview. 20.Moreover, as held by the Division Bench of this court in AroniCommercials Ltd. (supra) it is not necessary that the assessment ordershould contain reference and/or discussion to disclose its satisfaction inrespect of the query raised. Admittedly, as recorded in the assessment orderpetitioner’s case was selected for scrutiny under CASS and accordinglynotice dated 19[th] September 2018 under Section 143(2) of the Act andfurther notice dated 14[th] November 2018 under Section 142(1) of the Actalongwith questionnaire were issued and served on assessee. Petitioner wasasked to furnish details from time to time. Petitioner has submitted all thedetails and also attended personal hearing. In the assessment orderpetitioner’s submission regarding ESOP was rejected. The fact that theAssessment Order does not contain any reference or discussion relating todepreciation claimed by petitioner on the goodwill of Rs.148.19 Crores thatit had paid while applying the shares of ETPL would mean that the queryraised was considered by the A.O. while completing the assessment and theA.O. was satisfied with the explanation offered in respect of the queryraised. Paragraph Nos.11, 12 and 14 of Aroni Commercials Ltd. (supra)read as under : 11. In this case we are dealing with the reopening of assessmentcompleted by order dated 12 October 2010 under Section 143(3)of the Act. The law with regard to reopening of assessment is fairlysettled by decisions of Courts. The power of the Assessing Officersunder Sections 147 and 148 of the Act to reopen an assessment isclassified into two :- completed by order dated 12 October 2010 under Section 143(3)of the Act. The law with regard to reopening of assessment is fairlysettled by decisions of Courts. The power of the Assessing Officersunder Sections 147 and 148 of the Act to reopen an assessment isclassified into two :- (a) Reopening of assessment within a period of 4 yearsfrom the end of the relevant assessment year and from the end of the relevant assessment year and (b) Reopening of assessment beyond a period of 4years from the end of the relevant assessment year. (a) Reopening of assessment within a period of 4 yearsfrom the end of the relevant assessment year and from the end of the relevant assessment year and (b) Reopening of assessment beyond a period of 4years from the end of the relevant assessment year. The common jurisdictional requirement for reopening ofassessment both within and beyond a period of 4 years has to be onthe basis of reason to believe that income chargeable to tax hasescaped assessment and the reason for issuing a notice to reopenare recorded before issuing a notice. However, there is oneadditional jurisdictional requirement to be satisfied while seekingto reopen the assessment beyond the period of 4 years from theend of the relevant assessment year viz. that there must have beena failure on the part of the assessee to disclose fully and truly allmaterial facts necessary for assessment during the originalassessment proceedings. Thus the primary requirement to reopenany assessment is a reason to believe that income chargeable to taxhas escaped assessment. However, as observed by the SupremeCourt in the case of CIT vs. Kelvinator India Limited [2010] 320ITR 561/187 Taxman 312 in the context of Sections 147/148 of theAct that reason to believe found therein does not give arbitrarypowers to reopen an assessment. The concept of change of opinionis excluded/omitted from the words reason to believe. Thus achange of opinion would not be reason to believe that incomechargeable to tax has escaped assessment. Besides the power toreassess is not a power to review. Further reopening must be onthe basis of tangible material. 12) Therefore the power to reassess cannot be exercised on thebasis of mere change of opinion i.e. if all facts are available onrecord and a particular opinion is formed, then merely becausethere is change of opinion on the part of the Assessing Officernotice under Section 147/148 of the Act is not permissible. Thepowers under Section-147/148 of the Act cannot be exercised tocorrect errors/mistakes on the part of the Assessing Officer whilepassing the original order of assessment. There is a sanctitybestowed on an order of assessment and the same can be disturbedby exercise of powers under Sections 147/148 of the Act only onsatisfaction of the jurisdictional requirements. Further, the reasonsfor reopening an assessment has to be tested/examined only on thebasis of the reasons recorded at the time of issuing a notice underSection 148 of the Act seeking to reopen an assessment. Thesereasons cannot be improved upon and/or supplemented much lesssubstituted by affidavit and/or oral submissions. Moreover, thereasons for reopening an assessment should be that of theAssessing Officer alone who is issuing the notice and he cannot actmerely on the dictates of any another person in issuing the notice.Moreover, the tangible material upon the basis of which theAssessing Officer comes to the reason to believe that incomechargeable to tax has escaped assessment can come to him fromany source, however, reasons for the reopening has to be only ofthe Assessing Officer issuing the notice. At the stage of issuingnotice under Section 148 of the Act to reopen a concludedassessment the satisfaction of the Assessing Officer issuing thenotice is of primary importance. This satisfaction must be primafacie satisfaction of having a reason to believe that income chargeable to tax has escaped assessment. At the stage of theissuing of the notice under Section 148 of the Act it is notnecessary for the Assessing officer to establish beyond doubt thatincome indeed has escaped assessment. chargeable to tax has escaped assessment. At the stage of theissuing of the notice under Section 148 of the Act it is notnecessary for the Assessing officer to establish beyond doubt thatincome indeed has escaped assessment. 14. We find that during the assessment proceedings the petitionerhad by a letter dated 9 July 2010 pointed out that they wereengaged in the business of financing trading and investment inshares and securities. Further, by a letter dated 8 September 2010during the course of assessment proceedings on a specific querymade by the Assessing Officer, the petitioner has disclosed in detailas to why its profit on sale of investments should not be taxed asbusiness profits but charged to tax under the head capital gain. Insupport of its contention the petitioner had also relied upon CBDTCircular No.4/2007 dated 15 June 2007. (The reasons forreopening furnished by the Assessing Officer also places relianceupon CBDT Circular dated 15 June 2007). It would therefore, benoticed that the very ground on which the notice dated 28 March2013 seeks to reopen the assessment for assessment year 2008-09was considered by the Assessing Officer while originally passingassessment order dated 12 October 2010. This by itselfdemonstrates the fact that notice dated 28 March 2013 underSection 148 of the Act seeking to reopen assessment for A.Y. 2008-09 is based on mere change of opinion. However, according to Mr.Chhotaray, learned Counsel for the revenue the aforesaid issue nowraised has not been considered earlier as the same is not referred toin the assessment order dated 12 October 2010 passed for A.Y.2008-09. We are of the view that once a query is raised during theassessment proceedings and the assessee has replied to it, it followsthat the query raised was a subject of consideration of theAssessing Officer while completing the assessment. It is notnecessary that an assessment order should contain referenceand/or discussion to disclose its satisfaction in respect of the queryraised. If an Assessing Officer has to record the considerationbestowed by him on all issues raised by him during the assessmentproceeding even where he is satisfied then it would be impossiblefor the Assessing Officer to complete all the assessments which arerequired to be scrutinized by him under Section 143(3) of the Act.Moreover, one must not forget that the manner in which anassessment order is to be drafted is the sole domain of theAssessing Officer and it is not open to an assessee to insist that theassessment order must record all the questions raised and thesatisfaction in respect thereof of the Assessing Officer. The onlyrequirement is that the Assessing Officer ought to have consideredthe objection now raised in the grounds for issuing notice underSection 148 of the Act, during the original assessment proceedings.There can be no doubt in the present facts as evidenced by a letterdated 8 September 2012 the very issue of taxability of sale ofshares under the head capital gain or the head profits and gainsfrom business was a subject matter of consideration by theAssessing Officer during the original assessment proceedingsleading to an order dated 12 October 2010. It would therefore,follow that the reopening of the assessment by impugned notice dated 28 March 2013 is merely on the basis of change of opinion ofthe Assessing Officer from that held earlier during the course ofassessment proceeding leading to the order dated 12 October 2010.This change of opinion does not constitute justification and/orreasons to believe that income chargeable to tax has escapedassessment. 21.Having considered the reasons to reopen and the query raised and the replies filed, we are satisfied that it is merely on the basis of change dated 28 March 2013 is merely on the basis of change of opinion ofthe Assessing Officer from that held earlier during the course ofassessment proceeding leading to the order dated 12 October 2010.This change of opinion does not constitute justification and/orreasons to believe that income chargeable to tax has escapedassessment. 21.Having considered the reasons to reopen and the query raised and the replies filed, we are satisfied that it is merely on the basis of change of opinion from that held earlier during the course of assessmentproceedings that reopening of the assessment by the impugned notice isproposed. This change of opinion does not constitute justification and thereasons to believe that income chargeable to tax has escaped assessment. 22.We also note that in the affidavit in rejoinder dated 2[nd] May 2022, in Paragraph No.6, petitioner has averred as under : “the judgment relied upon by the Respondents in the case ofConsolidated Photo & Finvest Ltd. v/s. ACIT (2006) 151 Taxman41 (Delhi) has been subsequently disapproved by the judgment inthe case of KLM Royal Dutch Airlines v/s. ADIT (2007) 292 ITR 49(Delhi) and the judgment of the Full Bench in the case of CIT v/s.Usha International Ltd. (2012) 348 ITR 485 (Delhi) as also the saiddecision runs counter to the Full Bench decision of the Hon’bleDelhi High Court in the case of CIT v/s. Kelvinator India Limited(2002) 256 ITR 1 which has also been approved by the Hon’bleSupreme Court in (2010) 320 ITR 561(SC). 23.There is no denial by respondents. Hence, the petition is allowed in terms of prayer clause – (a) which reads as under : (a) that this Hon’ble Court be pleased to issue a Writ of Certiorarior any other writ order or direction under Article 226/227 of theConstitution of India calling for the records of the case leading tothe issue of the Impugned Notice dated March 27, 2021 (ExhibitR), issuance of Impugned Scrutiny Notice dated 7 December 2021(Exhibit W) and passing of the Impugned Order dated 24 January2022 (Exhibit Y) and after going through the same and examiningthe question of legality thereof quash, cancel and set aside theImpugned Notice dated March 27, 2021 (Exhibit R), Impugned Scrutiny Notice dated 7 December 2021 (Exhibit W) and ImpugnedOrder dated 24 January 2022 (Exhibit Y); 24.Petition disposed. (FIRDOSH P. POONIWALLA, J.) (K.R. SHRIRAM, J.)