Wp/393/2022 Of M/S. Ccl Products (India) Limited v. The Assistant Commissioner Of Income Tax

IN THE HIGH COURT OF ANDHRA PRADESH :: AMARAVATI(Special Original Jurisdiction)WEDNESDAY. THE TWENTY NINETH DAY OF JANUARYTWO THOUSAND AND TWENTY FIVEPRESENT THE HONOURABLE SRI JUSTICE B KRISHNA MOHANANDTHE HONOURABLE SRI JUSTICE NYAPATHY VIJAYWRIT PETITION NO: 393 OF 2022 Between: M/s. CCLProducts(India)Limited,RepresentedbyitsAuthorizedSignatory C.Srishant, Managing Director, Having its Registered office atDuggirala, Guntur District, Andhra Pradesh - 522330 ...PETITIONER AND 1. The Assistant Commissioner of Income Tax, Circle 1(1), Guntur 2. The Principal Commissioner of Income Tax SVR Plaza, VP SiddhardhaPublic School Road Moghalirajpuram Vijayawada - 520001Public School Road Moghalirajpuram Vijayawada - 520001 3. National Faceless Assessment Centre Delhi, 2"'^ Floor, JawaharlalNehru Stadium, Delhi - 110003Nehru Stadium, Delhi - 110003 4. Union of India, Represented by its Secretary to the GovernmentDepartment of Revenue, Ministry of Finance New Delhi - 110001‘ ...RESPONDENTS Petition under Article 226 of the Constitution of India praying that inthe circumstances stated in the affidavit filed therewith, the High Court maybe pleased to issue a Writ, Order or direction, more particularly one in thenature of ‘Writ of Mandamus’ orany other applicable writ declaring andsettingasidetheImpugnedNotice-1withDIN&NoticeITBA/AST/S/148/2020- 21/1031908437(1) dated 30.03.2021 issued by theAssistantCommissionerofIncomeStTaxCircle1(1),Guntur(1Respondent), the Impugned Notice-2 with DIN ITBA/AST/F/142(1)/20[21] > 22/1037352472(1) dated29.11.2021issuedbytheNationalFacelessAssessment Centre, Delhi (3rd Respondent) and the ImpugnedOrder withDIN & Letter No. ITBA/AST/F/17/2021-22/1038028742(1) dated 22.12.2021issuedbytheNationalFacelessAssessmentCentreDelhi(3^^^Respondent) as being in violation of principles of natural justice, withoutjurisdiction, patentlyillegal, arbitrary, violativeof Article14andArticle19(1 )(g) of the Constitution of India. lA NO: 1 OF 2099 Petition under Section 151 CPCpraying that in the circumstancesstated in the affidavit filediin support of the petition, the High Court may bepleased to grant stay of all furtherproceedings pursuant to the ImpugnedNotice-1 with DIN & Notice No.ITBA/AST/S/148/2020- 21/1031908437(1)dated 30.03.2021 issued by the Assistant Commissioner of Income TaxCircie 1(1), Guntur (1=' Respondent), the ImpugnedNotice-2 withDIN-ITBA/AST/F/142(1 )/2021 -22/1037352472(1) dated29.11.2021 issued by theNational Faceless Assessment CentreDelhi(3'"^ Respondent) and theImpugnedOrderwithDIN&LetterNo.ITBA/AST/F/17/2021-22/1038028742(1) dated 22.12.2021issued by the NationalFacelessAssessment Centre, Delhi (3rd Respondent)pending disposal of the mainWrit Petition. lA NO: 1 OF 2023 Between: 1. The Assistant Commissioner of Income Tax,Circle 1(1), Guntur 2. The Principal Commissioner of Income Tax SVR Plaza, VP Siddhardha Public School Road Moghalirajpuram Vijayawada - 520001 3. National Faceless Assessment Centre Delhi, 2^^" Floor, JawaharlalNehru Stadium, Delhi - 110003Nehru Stadium, Delhi - 110003 4. Union of India, Represented by its Secretary to the Government^Department of Revenue, Ministry of Finance New Delhi - 110001 ...PETITIONERS/ RESPONDENTS in WP No.393 OF 2022AND M/s.CCLProducts(India)Limited,RepresentedbyitsAuthorizedSignatory C.Srishant, Managing Director, Havingits Registered office atDuggirala, Guntur District, Andhra Pradesh - 522330 ...RESPONDENT/ WRIT PETITIONER in WP No.393 OF 2022Petition under Section 151 CPC praying that in the[circumstances]stated in the affidavit filed in support of the petition, the High Court may bepleasedto vacate theinterimdirections grantedinIA.No.1of 2022inW.P.No.393 of 2022 dated 07-01-2022, in the interests of justice.Counsel for the Petitioner; SRI KARAN TALWARCounsel for the Respondent Nos.1 & 2: SRI Y. N. VIVEKANANDA, FOR INCOME TAX Counsel for the Respondent Nos.3 & 4: DEPUTY SOLICITOR GENERAL OF INDIA ...PETITIONERS/ RESPONDENTS in WP No.393 OF 2022AND M/s.CCLProducts(India)Limited,RepresentedbyitsAuthorizedSignatory C.Srishant, Managing Director, Havingits Registered office atDuggirala, Guntur District, Andhra Pradesh - 522330 ...RESPONDENT/ WRIT PETITIONER in WP No.393 OF 2022Petition under Section 151 CPC praying that in the[circumstances]stated in the affidavit filed in support of the petition, the High Court may bepleasedto vacate theinterimdirections grantedinIA.No.1of 2022inW.P.No.393 of 2022 dated 07-01-2022, in the interests of justice.Counsel for the Petitioner; SRI KARAN TALWARCounsel for the Respondent Nos.1 & 2: SRI Y. N. VIVEKANANDA, FOR INCOME TAX Counsel for the Respondent Nos.3 & 4: DEPUTY SOLICITOR GENERAL OF INDIA The Court made the following: ORDER IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI WRIT PETITION No.393 of 2022 Between: M/s. CCl Products (India) Limited ...PETITIONER AND Tax and Others and Others Others...RESPONDENT{S) The Assistant Commissioner of Income Tax and Others and Others Others DATE OF ORDER PRONOUNCED; 29.01.2025. SUBMITTED FOR APPROVAL: THE HON’BLE SRI JUSTICE B KRISHNA MOHANANDTHE HON’BLE SRI JUSTICE NYAPATHY VIJAY 1.Whether Reporters of Local newspapers maybe allowed to see the Order?Yes/Nobe allowed to see the Order?Yes/No2.Whether the copies of order may be markedto Law Reporters/Journals?Yes/Noto Law Reporters/Journals?Yes/No 3.Whether Your Lordships wish to see the fairCopy of the Order?Copy of the Order? Yes/No * THE HON'BLE SRI JUSTICE B KRISHNA MOHANAND * THE HON’BLE SRI JUSTICE NYAPATHY VIJAY + WRIT PETITION N0.393 of 2022 % DATE 29.01.2025 Between: M/s. CCI Products (India) Limited ...PETITIONER AND $ The Assistant Commissioner Of Income Tax and Others ...RESPONDENT(S) DATE OF ORDER PRONOUNCED:29.01.2025 ! Counsel for the petitioner:KARAN TALWAR Counsel for the respondents: 1. DEPUTY SOLICITOR GENERAL OF INDIA 2.YN VIVEKANANDA <Gist: >Head Note: ? Cases referred: 1. [2012] 24 taxmann.com 310 (SC) 2. [2010] 187 taxman 312 (SC) 3. 2020 see Online AP 752 APHC010000602022 IN THE HIGH COURT OF ANDHRA PRADESHAT AMARAVATI(Special Original Jurisdiction) m[3516] i WEDNESDAY ,THE TWENTY NINETH DAY OF JANUARYTWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE B KRISHNA MOHAN THE HONOURABLE SRI JUSTICE NYAPATHY VIJAYWRIT PETITION NO: 393/2022 Between: 1.M/S. CCL PRODUCTS(INDIA)LIMITED, REPRESENTED BYITSAUTHORIZED SIGNATORY C.SRISHANT, MANAGINGDIRECTOR,HAVINGITSREGISTEREDOFFICEATDUGGIRALA,GUNTURDISTRICT, ANDHRA PRADESH - 522330AUTHORIZED SIGNATORY C.SRISHANT, MANAGINGDIRECTOR,HAVINGITSREGISTEREDOFFICEATDUGGIRALA,GUNTURDISTRICT, ANDHRA PRADESH - 522330 ...PETITIONER AND 1.THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE1(1)GUNTURGUNTUR 2.THE PRINCIPAL COMMISSIONER OF INCOME TAX SVR PLAZA, SIDDHARDHAPUBLICSCHOOLROADMOGHALIRAJPURAMVIJAYAWADA - 520001SIDDHARDHAPUBLICSCHOOLROADMOGHALIRAJPURAMVIJAYAWADA - 520001 3.NATIONAL FACELESS ASSESSMENT CENTRE DELHI, 2ND FLOOR,JAWAHARLAL NEHRU STADIUM, DELHI - 110003JAWAHARLAL NEHRU STADIUM, DELHI - 110003 4.UNION OFINDIA, REPRESENTED BYITS SECRETARY TO THEGOVERNMENTDEPARTMENTOFREVENUE,MINISTRYOFFINANCE NEW DELHI- 110001GOVERNMENTDEPARTMENTOFREVENUE,MINISTRYOFFINANCE NEW DELHI- 110001 ...RESPONDENT(S): Petition under Article 226 of the Constitution of India praying that in thecircumstances statedin the affidavit filed therewith, the High Court may bepleased to lA NO: 1 OF 2022 AND 1.THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE1(1)GUNTURGUNTUR 2.THE PRINCIPAL COMMISSIONER OF INCOME TAX SVR PLAZA, SIDDHARDHAPUBLICSCHOOLROADMOGHALIRAJPURAMVIJAYAWADA - 520001SIDDHARDHAPUBLICSCHOOLROADMOGHALIRAJPURAMVIJAYAWADA - 520001 3.NATIONAL FACELESS ASSESSMENT CENTRE DELHI, 2ND FLOOR,JAWAHARLAL NEHRU STADIUM, DELHI - 110003JAWAHARLAL NEHRU STADIUM, DELHI - 110003 4.UNION OFINDIA, REPRESENTED BYITS SECRETARY TO THEGOVERNMENTDEPARTMENTOFREVENUE,MINISTRYOFFINANCE NEW DELHI- 110001GOVERNMENTDEPARTMENTOFREVENUE,MINISTRYOFFINANCE NEW DELHI- 110001 ...RESPONDENT(S): Petition under Article 226 of the Constitution of India praying that in thecircumstances statedin the affidavit filed therewith, the High Court may bepleased to lA NO: 1 OF 2022 Petition under Section 151 CPCpraying that in the[circumstances][ stated]in the affidavit filed in support of the petition, the High Court may be pleasedpleasedto grant stay of all further proceedings pursuant to the ImpugnedNotice-1withDIN&NoticeNo.ITBA/AST/S/148/2020- 21/1031908437(1)dated 30.03.2021 issued by the Assistant Commissioner of Income Tax, Circle1(1),Guntur(1stRespondent),theImpugnedNotice-2withDIN-ITB/VAST/F/142(1)/2021-22/1037352472(1) dated 29.11.2021issued by theNationalFacelessAssessmentCentre,Delhi(3rdRespondent)andtheImpugnedOrderwithDIN&LetterNo.ITBA/AST/F/17/2021-22/1038028742(1)dated22.12.2021issuedbytheNationalFacelessAssessment Centre,Delhi(3rd Respondent), pending disposal of the mainWrit Petition, and to pass lA NO: 1 OF 2023 Petition under Section 151 CPCpraying that in the[circumstances][ stated]in the affidavit filed in support of the petition, the High Court may be pleasedpleased to vacate the interim directions granted in[lA.No.]1 of 2022 in W.P.No.393 of 2022 dated 07-01-2022, in the interests of justice, and to pass Counsel for the Petitioner: 1. KARAN TALWAR Counsel for the Respondent(S): 1.DEPUTY SOLICITOR GENERAL OF INDIA 2.Y N VIVEKANANDA The Court made the following: ORDER (per Hon’ble Sri Justice B.Krishna Mohan): Heard the learned counsel for the petitioner and the learned StandingCounsel for the respondent Nos.1 to 3. 2.This writ petitionisfiledquestioningtheNoticewithDIN&NoticeNo.lTBA/AST/S/148/2020-21/1031908437(1) dated 30.03.2021 issued by the1®* respondent (Impugned Notice-1), Notice with DIN-ITBA/AST/F/1 42(1)/2021-22/1037352472(1) dated 29.11.2021 issued by therespondent (ImpugnedNotice-2)andtheOrderwithDin&LetterNo.lTBA/AST/F/17/2021-22/1038028742(1) dated 22.12.2021 issued by therespondent (ImpugnedOrder)asbeinginviolationof theprinciplesof naturaljustice,withoutjurisdiction, patently illegal, arbitrary, violative of Article 14 and Article 19(1)(g)of the Constitution of India.No.lTBA/AST/S/148/2020-21/1031908437(1) dated 30.03.2021 issued by the1®* respondent (Impugned Notice-1), Notice with DIN-ITBA/AST/F/1 42(1)/2021-22/1037352472(1) dated 29.11.2021 issued by therespondent (ImpugnedNotice-2)andtheOrderwithDin&LetterNo.lTBA/AST/F/17/2021-22/1038028742(1) dated 22.12.2021 issued by therespondent (ImpugnedOrder)asbeinginviolationof theprinciplesof naturaljustice,withoutjurisdiction, patently illegal, arbitrary, violative of Article 14 and Article 19(1)(g)of the Constitution of India. 3.The learned counselfor thepetitioner submits that thepetitionerisinteralia, engagedin the manufacture and supply of[soluble]instant coffeepowder, agglomerated/granule coffee, roast & ground[coffee][ and][ concentrated]liquid coffee and other relatedproducts. The petitionerfileditsReturnofIncomefor the Assessment Year 2015-2016 andall the auditedfinancialsincluding Form 3CA under Section 44AB of the Income Tax Act, 1961, balancesheets and statement of profit and loss on 28.09.2015 declaring a total incomeof Rs. 112,58,64,910/-.interalia, engagedin the manufacture and supply of[soluble]instant coffeepowder, agglomerated/granule coffee, roast & ground[coffee][ and][ concentrated]liquid coffee and other relatedproducts. The petitionerfileditsReturnofIncomefor the Assessment Year 2015-2016 andall the auditedfinancialsincluding Form 3CA under Section 44AB of the Income Tax Act, 1961, balancesheets and statement of profit and loss on 28.09.2015 declaring a total incomeof Rs. 112,58,64,910/-. Then the petitioner received a notice under section[142(1)][ of][ the][ Income]TaxAct,1961 dated 11.12.2018 from the1®‘ respondent requestingthepetitioner to furnish accounts for the conduct of incometax assessment.Thepetitioner had complied with the notice received and[furnished][ the][ required]informationand accounts including the tax audit report under Form[3CA,]Balancesheets and statement of profit and loss. In particular,[the][ petitioner]alsofurnished information regarding interest expenses and[the][ purchased]shares of Ngon Coffee Company as requested by the 1®*[respondent.][ The][ 1]Strespondent completed the assessment under section 143(3)of the Act andpassed an assessment order dated 28.12.2018 issued a notice under Section 148 of the Act byThe petitioner again wasthe1Strespondent dated 30.03.2021 (Impugned Notice-1) statingthat thetobelievethatthepetitioner’sincomeassessingofficerhasreasonstax for the AY 2015-2016 has escaped assessment within[the]chargeable tomeaning of section 147 of the Act and hence, proposingto reassess theincome and requiring the petitioner to furnish a returnforthesame.Inresponseto theImpugned Notice-1, the petitioner submitted its ReturnofIncome to the 1" respondent again on 16.04.2021. The[l“][ respondent][ issued]anotice dated15.06.2021 to the petitioner under section 143(2) read[with]section 147 of the Act stating issues as per recorded[for][ reopening][ and][ that] income chargeable to tax of Rs.2,15,35,000/- has escaped[assessment][ under]Section 147 of the Act for the AY 2015-2016. The petitioner was also issued with a notice dated 17.11.2021statingthat as per the information available on record,it[is][ noticed][ from][ the][ balance]sheets as on 31.03.2014 and 31.03.2015 that the total investments made byassesseein shares were to the tune of Rs. 132.62 Crs.[and]Rs. 150.96Crs.respectively as furnished by the petitioner and therebytheinvestmentsinshares during the previous year corresponding to the [ 2015-2016]haveincreasedbyanamountofRs. 18.34Crs.fromthepreviousyearcorresponding to the AY 2015-2016.This notice also[states][ that][ the][ assessee]has debited the P&L Account for the year ended 31.03.2015[an][ amount][ of]Rs.5.64 Crs. towards finance costs andin viewof these facts, given thatexpenses were incurred by thepetitionerrelatableto earningof exemptsuchincomeand section14-A read withrule 8D are applicable wherebyexpenses incurred be disallowed. The notice further states that a total disallowance[of][ Rs.2,15,35,000/-]wasnever made by the petitioner while filing its income[tax][ return][ and][ hence]such income of Rs.2,15,35,000/- has escaped assessment[within][ the][ meaning]of section 147 of the Act for the AY 2015-2016. Then the petitioner filed replydated 29.11.2021to the notice dated 17.11.2021 stating its objections against The notice further states that a total disallowance[of][ Rs.2,15,35,000/-]wasnever made by the petitioner while filing its income[tax][ return][ and][ hence]such income of Rs.2,15,35,000/- has escaped assessment[within][ the][ meaning]of section 147 of the Act for the AY 2015-2016. Then the petitioner filed replydated 29.11.2021to the notice dated 17.11.2021 stating its objections against the reopening of assessment for the AY 2015-2016.The petitioner in theirreply also furnished such information sought by the 1®^ respondent detailing itsinvestmentsfor an amount of Rs. 150.88Crs.made as on 31.03.2015,itspurposes, the sources of such investments and additional details sought. Again,thepetitionerwasissuedwithanoticedated29.11.2021(Impugned Notice-2) under section 142(1) of the Act requesting the petitionerto furnish suchinformationrelevant to the AY 2015-2016 such as balancesheets, statements of profit and loss as well as the computation under Rule 8Dread with section 14A of the Act for an amount of Rs.5.6 Cr. that was debitedtowards finance costs. Thepetitioner wasfurtherissuedwithanorderdated22.12.2021(Impugned Order) disposing the objections to the reopening[of][ assessment]under section 147 of the Act for the AY 2015-2016. In the light of the above said set of facts, the learned[counsel][ for][ the]petitioner contends that the reopening of assessment based on mere changeof opinionis not permissible under law, reopeningof assessmentafter theexpiryof four years fromtheendofrelevant assessmentyearisnotpermissible under law, impugned orderis a non speakingorder anditisviolative of principles of natural justice and as suchit is liable to be set aside.Hefurther contendedthat no exempt income has beenreceivedby the petitioner for the relevant assessment year.Thereisnofreshmaterialortangible material available on record.The first proviso[of][ section][ 147][ of][ the]Income Tax Act was not dealt with by the department.The proviso to section147 and the proviso to section 149 of the Act shall be read together. 4.Onthe other hand, thelearned standing counselrelying uponthecounter affidavit of the respondent Nos.1 to 3 refers[to][ the][ assessment][ order]dated 28.12.2018, impugned notice dated 30.03.2021, returns furnished by thepetitioner dated 16.04.2021, notice dated 29.11.2021 and the rejection of theobjections dated 22.12.2021.He further submits that[there][ are][ reasons][ for]reopening of the assessment though thereis no freshmaterial available onrecord.BasingupontheReturnofIncomefiledbythepetitioner,therespondent authorities have to take a decision whether there was any incomechargeable to tax for the AY 2015-2016 which has escaped[assessment][ within]the meaning of section 147 of the Act and ultimately pleaded for sustaining theabove said impugned notices and the impugned order.counter affidavit of the respondent Nos.1 to 3 refers[to][ the][ assessment][ order]dated 28.12.2018, impugned notice dated 30.03.2021, returns furnished by thepetitioner dated 16.04.2021, notice dated 29.11.2021 and the rejection of theobjections dated 22.12.2021.He further submits that[there][ are][ reasons][ for]reopening of the assessment though thereis no freshmaterial available onrecord.BasingupontheReturnofIncomefiledbythepetitioner,therespondent authorities have to take a decision whether there was any incomechargeable to tax for the AY 2015-2016 which has escaped[assessment][ within]the meaning of section 147 of the Act and ultimately pleaded for sustaining theabove said impugned notices and the impugned order. 5.In view of the above said facts and circumstances and basing upon therival submissions made,it is to be seen that the1®^ respondent issued theimpugned notice under section 148 of the Income Tax Act, 1961 (ImpugnedNotice-1) for the AY 2015-2016 dated 30.03.2021statingthat they havereasons to believe that the iffcome chargeable to tax[for][ the][ said][ assessment]rival submissions made,it is to be seen that the1®^ respondent issued theimpugned notice under section 148 of the Income Tax Act, 1961 (ImpugnedNotice-1) for the AY 2015-2016 dated 30.03.2021statingthat they havereasons to believe that the iffcome chargeable to tax[for][ the][ said][ assessment] year has escaped assessment withinthe meaningof section147oftheIncome Tax Act, 1961 and proposedto reassess the income for thesaidassessment year for which the petitioner was asked to submit their returninthe prescribed form within 30 days from the date of receipt of the said notice. 6.The3rdrespondentvideDIN&letterNo.ITBA/AST/F/17/2021-22/1037021192(1) for the AY 2015-2016 dated 17.11.2021 addressed to thepetitioner mentioning the reasons for reopening the[assessment][ as][ under:] REASONS FOR THE REOPENING OF THE ASSESSMENT IN CASE OF M/S. COLPRODUCTS (INDIA) LIMITED, DUGGIRALA. As per information available on record,itis noticed from the balance sheets ason31.03.2014 and 31.03.2015 that the total investments made by assesseein shareswereto the tune of Rs.132.62 Crs andRs.150,96 Crs respectively. Thereby theinvestmentsin shares during the previous year corresponding[to][ A.Y.][ 2014-15][ have]increased by an amount of Rs. 18.34 Crs from the previous year corresponding to A.Y.2015-16.It is further noticed that assessee has debited the P&L a/c, for the year ended31.03.2015 an amount of Rs. 5.64 Crs towards finance costs.Inview of the abovestated facts, given that there are expenses incurred by assessee which are relatable toearning of exempt income, provisions of sec. 14A rwr 8D are squarely applicable toassessee's case, whereby expenses incurred be disallowed as per the provisions ofsec. 14A rwr 8D detailed out as under: Investments in shares as on 31-03-2014:Rs. 138.62 Crs.Investments in shares as on 31-03-2015:Rs.150.96Crs.Total:Rs.289.58 Crs.,Average totalRs. 144,79 Crs.0.5% of the aboveRs.72,35,000/-Total assets as on 31-03-2014Rs.545.55 Crs.Total assets as on 31-03-2015Rs.596.29 Crs.TotalRs. 1141.85 Crs.Average totalRs.570.92 Crs.Total interest debitedRs.5.64 Crs.Proportionate interest to be disallowedRs. 144.79/570.92X5.64=1.43Crs.The total disallowanceRs 72,35,000+1,43,00,0000-2,15,35,000/- However, no such disallowance as detailed out above has been made by the assesseewhilefilinghisROI.In viewoftheabove,I havereasontobelievethatincomechargeable to tax of Rs. 2,15,35,000/- has escaped assessment within the meaning ofprovisions of Sec. 147 of the Income Tax Act, 1961[for][ the][ Asst][ Year][ 2015-16.] Yours faithfully.Additional/Joint/Deputy/Assistant Commissioner of Income Tax/ Income-tax Officer,National Faceless Assessment Centre,Delhi Forwhichthepetitioneralsoraisedobjectionsdated29.11.2021informing the department that the assessment has been completed undersection 143(3) and the petitioner disclosed fully and truly all the material factsnecessary for the said assessment and the four years time specified under thefirst proviso of section 147 has expired on 31.03.2020[and][ the][ reassessment]proceedings are not initiated validly. 7.The relevant portion of Section 147 of the Income Tax[Act,][ 1961][ read][ as] under: Yours faithfully.Additional/Joint/Deputy/Assistant Commissioner of Income Tax/ Income-tax Officer,National Faceless Assessment Centre,Delhi Forwhichthepetitioneralsoraisedobjectionsdated29.11.2021informing the department that the assessment has been completed undersection 143(3) and the petitioner disclosed fully and truly all the material factsnecessary for the said assessment and the four years time specified under thefirst proviso of section 147 has expired on 31.03.2020[and][ the][ reassessment]proceedings are not initiated validly. 7.The relevant portion of Section 147 of the Income Tax[Act,][ 1961][ read][ as] under: 147.If the Assessing Officer has reason to believe that any income chargeable to taxhas escaped assessment for any assessment year, he may, subject to the provisions ofsections 148to153, assessor reassess such income and also any other incomechargeable to tax which has escaped assessment andwhichcomestohisnoticesubsequently in the course of proceedings under this section, or recompute the loss orthedepreciationallowanceor any other allowance,asthe case maybe,for theassessment year concerned(hereafterinthis section[and]insections148to153referred to relevant assessment year): Provided that where an assessment under sub-section (3) of section 143 or this sectionhas been made for the relevant assessment year, no[action]shall be taken under thissection after the expiry of four years from the end of the relevant assessment year,unless any income chargeable to tax has escaped assessment[for][ such][ assessment]year by reason of the failure on the part of the assessee[to][ make][ a][ return][ under][ section]139 or in response to a notice issued under sub-section (1) of section 142 or section148 or to disclose fully and truly all material facts necessary for his assessment, for thatassessment year; Provided further that nothing contained in the first[proviso][ shall][ apply][ in][ a][ case][ where]any incomeinrelation to any asset (including financial interest[in][ any][ entity)][ located]outside India, chargeable to tax, has escaped assessment[for][ any][ assessment][ year:] v.ICICI 8.In the case of Assistant Commissioner of Income Taxv.ICICISecurities Primary Dealership Ltd.\ in Civil Appeal[No.5960][ of][ 2012][ dated] 8. 22.08.2012, the Hon’ble Apex Court held as under: Leave granted. We have heard learned counsel on both sides.The assessee had disclosed full details, in the Return[of][ Income][ in][ the][ matter][ of]its dealing in stocks and shares. According to the[assessee,][ the loss][ incurred][ was]a businessloss, whereas,accordingto Revenue,thelossincurredwasaspeculative loss. Rejection of the objections of the[assessee][ to][ the][ re-opening][ of]the assessment by the Assessing Officer vide his Order[dated][ 23"'^][ June, 2006,][ is]clearly a change of opinion. In the circumstances,[we][ are][ of][ the][ view][ that][ the]order reopening the assessment was not maintainable.The civil appeal is, accordingly, dismissed.No order as to costs. 9. In the case of Commissioner of Income Tax, Delhi v.[Kelvinator][ of] India Ltd.\ in Civil Appeal Nos.2009-2011 of 2003 and[2520][ of][ 2008,][ dated]18.01.2010, the Hon’ble Apex Court went into the issue[whether][ the][ concept][ of]“change of opinion” stands obliterated with effect[from][ 01.04.1989]i.e.,aftersubstitution of section 147 of the Income Tax Act,[1961][ by][ Direct][ Tax][ Laws](Amendment) Act, 1987? Ultimately held that where the[Assessing][ Officer][ has]reasonto believe that income has escaped assessment, section[147][ of][ the Act]with effect from 01.04.1989 confers jurisdiction to[reopen][ the][ assessment.]Itwasalso observed that “mere change of opinion” cannot[be per se reason][ to] ' [2012] 24 taxmann.com 310 (SC)^ [2010] 187 taxman 312 (SC) I 9. In the case of Commissioner of Income Tax, Delhi v.[Kelvinator][ of] India Ltd.\ in Civil Appeal Nos.2009-2011 of 2003 and[2520][ of][ 2008,][ dated]18.01.2010, the Hon’ble Apex Court went into the issue[whether][ the][ concept][ of]“change of opinion” stands obliterated with effect[from][ 01.04.1989]i.e.,aftersubstitution of section 147 of the Income Tax Act,[1961][ by][ Direct][ Tax][ Laws](Amendment) Act, 1987? Ultimately held that where the[Assessing][ Officer][ has]reasonto believe that income has escaped assessment, section[147][ of][ the Act]with effect from 01.04.1989 confers jurisdiction to[reopen][ the][ assessment.]Itwasalso observed that “mere change of opinion” cannot[be per se reason][ to] ' [2012] 24 taxmann.com 310 (SC)^ [2010] 187 taxman 312 (SC) I reopen drawing the conceptual difference between power to review and powerto reassess.It was held that the Assessing Officer has no power to review buthe has the power to reassess. The Assessing Officer has the power to reopen,provided thereis “tangible material” to come to the conclusion that thereisescapement of income from assessment.The reasons must have a live linkwith the formation of the belief. 10.In the case of Madurai Power Corporation Private Limited v. DeputyCommissioner of Income Tax Circle-1^, in W.P.No.15201of 2019, dated30.01.2020, the then Division Bench of the High Court[observed][ at][ Para][ No.][ 12]of thesaid judgment that Section147of the Act furtherstatesthattheAssessingOfficer shouldhave reasontobelievethatcertainincomehasescaped the assessment on thebasisof new facts/informationwhichhascome to his knowledge subsequently.Section does not confer any right toreview when there is no new material or facts drawing[a different][ conclusion][ is]noticed.Commissioner of Income Tax Circle-1^, in W.P.No.15201of 2019, dated30.01.2020, the then Division Bench of the High Court[observed][ at][ Para][ No.][ 12]of thesaid judgment that Section147of the Act furtherstatesthattheAssessingOfficer shouldhave reasontobelievethatcertainincomehasescaped the assessment on thebasisof new facts/informationwhichhascome to his knowledge subsequently.Section does not confer any right toreview when there is no new material or facts drawing[a different][ conclusion][ is]noticed. 11.Comingtothe factsof this caseagain,thebalancesheetofthepetitioner as on 31.03.2015 furnishes thedetails under therelevanthead(apart from the other information furnished in detail in the said balance sheet)as under:petitioner as on 31.03.2015 furnishes thedetails under therelevanthead(apart from the other information furnished in detail in the said balance sheet)as under: Similarly, the statement of Profit & Loss for the year[ended][ 31.03.2015]for the petitioner, the relevant information is as[under;] Cash flow statement for the year ended 31.03.2015 under[the][ head][ of]‘Notes on financial statements for the year ended 31.03.2015at 2.10 Non-current Investments shows as under: 12.As stated supra, the1respondent issued notice under sub-section (1)of Section 142 of the Income Tax Act,1961for the AY[ 2015-2016][ dated]11.12.2018 to the petitioner to furnish the accounts and documents specifiedas per the Annexure to the saidnotice whichincludes interest expenses.number of shares of Ngon Coffee Company purchased by the petitioner andwhatis the actual cost paidper sharein VND andin at the timeofpurchase and what is the,face value of each share at the time of purchaseof Section 142 of the Income Tax Act,1961for the AY[ 2015-2016][ dated]11.12.2018 to the petitioner to furnish the accounts and documents specifiedas per the Annexure to the saidnotice whichincludes interest expenses.number of shares of Ngon Coffee Company purchased by the petitioner andwhatis the actual cost paidper sharein VND andin at the timeofpurchase and what is the,face value of each share at the time of purchase etc., apart from the other information to be furnished as detailed.Accordingly,thedetailsof interest expenses were submitted.On furnishing the entirethedetailsof interest expenses were submitted.On furnishing the entireinformation by way of Return of Income by the petitioner, therespondentcompleted the assessment under section 143(3) of the Act by passing theassessment order dated 28.12.2018 which reads as under;completed the assessment under section 143(3) of the Act by passing theassessment order dated 28.12.2018 which reads as under; The assesses is a company engaged in the business of manufacturingof instant coffee / soluble coffee, filed their Return[of][ Income][ for][ the][ Asst.][ Year]2015-16 on 28.09.2015, declaring a Total Income of Rs.112,58,64,910/-. Thereturn was processed u/s 143(1) of the IT Act. Subsequently,[the][ case][ was]selected under CASS for complete scrutiny. Accordingly notices u/s. 143(2)and 142(1) of the I.T. Act, 1961 were generated electronically through ITBAand sent to the assessee's email address.In response to the notices, theassessee submitted the information electronically as[called][ for.] On the basis of the examination of the ROI, the information[furnished]in support of the claims made in the return and the[books][ of][ account][ of][ the]assessee, the assessment is completed as under: rd 13.Contrary to the above said Assessment Order dated 28.12.2018,[the][ 3]respondent ultimately issued the impugned order dated[22.12.2021][ for][ the][ AY]2015-2016 by not accepting the objections of the petitioner, reopenedtheassessment by observing that reassessment proceedings will continue. Uponperusal of the material available on record and in view of the settled principlesof law and the facts of the case as discussedabove,itisclear thatthepetitioner filed its Return of Income for the AY 2015-2016[and]all the auditedfinancials including Form 3CA under section 44AB of[the][ Income][ Tax][ Act,]1961, Balance Sheets and statement of Profit & Loss on 28.09.2015itself,declaring the total income of Rs.112,58,64,910/-.Then the1®* respondentrespondent ultimately issued the impugned order dated[22.12.2021][ for][ the][ AY]2015-2016 by not accepting the objections of the petitioner, reopenedtheassessment by observing that reassessment proceedings will continue. Uponperusal of the material available on record and in view of the settled principlesof law and the facts of the case as discussedabove,itisclear thatthepetitioner filed its Return of Income for the AY 2015-2016[and]all the auditedfinancials including Form 3CA under section 44AB of[the][ Income][ Tax][ Act,]1961, Balance Sheets and statement of Profit & Loss on 28.09.2015itself,declaring the total income of Rs.112,58,64,910/-.Then the1®* respondent completed the assessment under section 143(3) of the Act and passed anAssessmentOrderdated28.12.2018.But contraryto thefirst proviso ofsection 147 of the Income Tax Act, 1961, the above said impugned notice ofthe1®‘ respondent dated 30.03.2021 (Impugned Notice-1),notice of the3rdrespondent dated 29.11.2021 (Impugned Notice-2) and the impugned order oftherespondent dated 22.112.2021 were issued without there being anyfresh information / material available on record and in the absence of any validreasons / grounds to allege that certain income chargeable to tax has escapedfrom assessment, which came to the notice of the respondent departmentsubsequently, for the purpose of reopening of reassessment proceedings byway of the impugned action whichis not permissible[under][ law.]Itis a casewherethe assesseedisclosedthefulldetailsintheReturnof Incomeasdiscussed above. The Assessing Officer has no power to review. Hence, theimpugned action of the respondents is nothing but mere change of opinion onthe assessment made already, which cannot be per se reason to reopen theearlier assessment order to reassess contrary to the law.There is no tangiblematerial to come to the conclusion that there is escapement[of][ income][ from]theassessment.Theabovesaidimpugnedactionoftherespondentdepartment thus does not establish that there was any failure to disclose fullyand truly all the material facts necessary for the[assessment.]There has beenno avermentinthe above said impugnednotices andtheorderthatthe m amountof incometaxinvolvedis morethanRs.1lakhtoattractsection149(1 )(b) of the Income Tax Act, 1961.Failure to mentionin the above saidimpugned notices that there has been a failure to disclose fully and truly all thematerial facts and that the income involved is more than one lakh would vitiatethe assessment sought to be reopened after four years.It is the assessingofficer who needs to assess any disallowance under[section][ 14A][ based][ on][ the]informationprovidedbythepetitioner.Onustomakeanappropriatedetermination of amount of expenditure in terms of[section][ 14A][ of][ the][ Act][ lies]onthe assessingofficer and whenthereis nofailure onthepart of theassesseein making availableall the relevant account books, materials anddocuments, the assessing officer cannot assume jurisdiction[under][ section][ 147]of the Act and more specifically cannot do soin an attempt to reopen theassessment after expiry of 4 years from the relevant assessment year whenoriginal assessment was made under Section 143(3) of the Act.In any event,thepetitioner’sdutyisonlyto discloseprimary factsandit wasfortheassessing officer to draw inferences there from.Failure on the part of theAssessing Officer to draw inferences cannot mean that the petitioner had notdisclosedallthematerialfacts.Noneof the impugnednotices andtheimpugned order issued to the petitioner even mentioned[as][ to][ what were][ the]exempt income received by the petitioner for the relevant assessment year. 14.For the foregoing reasons, the above said impugned notices and theimpugned order of the respondents are set aside by allowing the writ petition.Accordingly, the writ petition is allowed. No costs. As a sequel. Miscellaneous Petitions pending, if any, shall stand closed. Sd/- P.U.V.BHASKAR RAOASSISTANT REGISTRAR //TRUE COPY// SEdmN OFFICER One fair copy to the Hon’ble SRI JUSTICE B. KRISHNA (For His Lordships Kind Perusal) One fair copy to the Hon’ble SRI JUSTICE NYAPATHY VIJAY(For His Lordships Kind Perusal) To, 1. The Assistant Commissioner of Income Tax. Circle 1(1), Guntur 2. The Principal Commissioner of Income Tax SVR Plaza, [ Siddhardha]Public School Road Moghalirajpuram Vijayawada - 520001Public School Road Moghalirajpuram Vijayawada - 520001 3.National Faceless Assessment Centre Delhi, 2"*^ Floor, JawaharlalNehru Stadium, Delhi - 110003Nehru Stadium, Delhi - 110003 4.The Secretary to the Government, Department of Revenue,[Union][ of]India, Ministry of Finance New Delhi - 110001India, Ministry of Finance New Delhi - 110001 Sd/- P.U.V.BHASKAR RAOASSISTANT REGISTRAR //TRUE COPY// SEdmN OFFICER One fair copy to the Hon’ble SRI JUSTICE B. KRISHNA (For His Lordships Kind Perusal) One fair copy to the Hon’ble SRI JUSTICE NYAPATHY VIJAY(For His Lordships Kind Perusal) To, 1. The Assistant Commissioner of Income Tax. Circle 1(1), Guntur 2. The Principal Commissioner of Income Tax SVR Plaza, [ Siddhardha]Public School Road Moghalirajpuram Vijayawada - 520001Public School Road Moghalirajpuram Vijayawada - 520001 3.National Faceless Assessment Centre Delhi, 2"*^ Floor, JawaharlalNehru Stadium, Delhi - 110003Nehru Stadium, Delhi - 110003 4.The Secretary to the Government, Department of Revenue,[Union][ of]India, Ministry of Finance New Delhi - 110001India, Ministry of Finance New Delhi - 110001 5. One CC to Sri Karan Talwar, Advocate 6. One CC to Sri Y. N. Vivekananda, SC for Income Tax 7. One CC to the Deputy Solicitor General of India, High Court of A.P. atAmaravati Amaravati 8.9 LR Copies 9. The Under Secretary, Union of India, Ministry of Law, Justice andCompany Affairs, New Delhi.Company Affairs, New Delhi. 10. The Secretary, A.P. Advocates’ Association Library, High CourtBuildings, Amaravathi.Buildings, Amaravathi. 11. Three CD Copies. ssb HIGH COURT DATED:29/01/2025 ORDERWP.No.393 of 2022 I1 2 FEB 2C25|5^Current Section ^jji ALLOWING THE W.P. WITHOUT COSTS