ACIT Co. v. Central Warehousing Corporation & Vice Versa

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The Tax Publishers2012 TaxPub(DT) 1766 (Del-Trib) : (2012) 144 TTJ 0764 : (2012) 067 DTR 0356 INCOME TAX ACT, 1961 --Reassessment--Change of opinionSubsequent Supreme Court's decision--In assessee's case the Tribunal passed consolidated order dated 31-3-2008 for the assessment years 1989-90 to 1996-97 in respect of reassessments under section 148 along with other appeals for assessment years 1997-98, 1999-2000 and 2000-01 against regular assessments. Assessee also filed cross-objections in respect of the above assessment years. In the aforementioned consolidated order the Tribunal held that reopening of assessments for assessment years 1989-90. 1993-94, 1995-96 and 1996-97 to be valid in law. On respective grievances, assessee and revenue both went in appeal before Delhi High Court, challenging various aspects including assessee's grievance about reopening under section 148 for assessment years 1995-96 and 1996-97 being based on change of opinion by assessing officer. High Court in paras 33 & 34 of its order dated 14-1-2011, remitted the issue of reopening for assessment years 1995-96 & 1996-97 only back to Tribunal on limited question as to whether reassessment was because of change of opinion by assessing officer or not. Held: In view of decision of Allahabad High Court in the case of Kartikeya International () 329 ITR 539 (All) though decision in Orissa Warehousing's case the Apex Court decision was pronounced subsequent to assessing officer's view in assessee's case, the reopening of assessment was not based on change of opinion. The original assessment orders for assessment years 1995-96 & 1996-97 were framed by the assessing officer prior to the pronouncement of the judgment of the Hon'ble Supreme Court. With the Supreme Court's decision it was incumbent on assessing officer to examine whether the claim allowed by him under section 10(29) during the original assessment proceedings was in conformity with the same. The assessing officer cannot presupposes what the Supreme Court was going to hold in Orissa State Warehousing Corpn. The exercise of power under section 148 by assessing officer was to implement Supreme Court judgment and not change of his opinion. Therefore, the reopening was valid and sustainable. The judgment in the case of Kartikeya International () 329 ITR 539 (All) is squarely applicable to assessee's facts. Respectfully following the same the theory of reassessment based on change of opinion is not applicable to assessee's case as the assessing officer was implementing the law of the land as declared by the Supreme Court. Thus, there is no force in the contention raised by the assessee in its cross-objections for both the assessment years in question. Thus, the issue of re-opening of assessments is decided in favour of revenue and against the assessee. Consequent, the result of revenue's appeals and assessee's C.Os for assessment years 1995-96 & 1996-97 will remain as held in Tribunal's consolidated order dated 31-3-2008. [Para 5.1] Income Tax Act, 1961, Section 147 Income Tax Act, 1961, Section 148 IN THE ITAT, DELHI BENCH 'A' R.P. TOLANI (J.M) & SHRI SHAMIM YAHYA ACIT Co. v. Central Warehousing Corporation & Vice Versa ITA Nos. 2865 & 2866/Del/2003 CO. Nos. III & 112/Del/2006 A.Y. 1995-96 & 1996-97 9 September, 2011 Department by : H.L. Dhihana CIT DR SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2012 TaxPub(DT) 1766 (Del-Trib) : (2012) 144 TTJ 0764 : (2012) 067 DTR 0356

INCOME TAX ACT, 1961

--Reassessment--Change of opinionSubsequent Supreme Court's decision--In assessee's case the Tribunal passed consolidated order dated 31-3-2008 for the assessment years 1989-90 to 1996-97 in respect of reassessments under section 148 along with other appeals for assessment years 1997-98, 1999-2000 and 2000-01 against regular assessments. Assessee also filed cross-objections in respect of the above assessment years. In the aforementioned consolidated order the Tribunal held that reopening of assessments for assessment years 1989-90. 1993-94, 1995-96 and 1996-97 to be valid in law. On respective grievances, assessee and revenue both went in appeal before Delhi High Court, challenging various aspects including assessee's grievance about reopening under section 148 for assessment years 1995-96 and 1996-97 being based on change of opinion by assessing officer. High Court in paras 33 & 34 of its order dated 14-1-2011, remitted the issue of reopening for assessment years 1995-96 & 1996-97 only back to Tribunal on limited question as to whether reassessment was because of change of opinion by assessing officer or not. Held: In view of decision of Allahabad High Court in the case of Kartikeya International () 329 ITR 539 (All) though decision in Orissa Warehousing's case the Apex Court decision was pronounced subsequent to assessing officer's view in assessee's case, the reopening of assessment was not based on change of opinion.

The original assessment orders for assessment years 1995-96 & 1996-97 were framed by the assessing officer prior to the pronouncement of the judgment of the Hon'ble Supreme Court. With the Supreme Court's decision it was incumbent on assessing officer to examine whether the claim allowed by him under section 10(29) during the original assessment proceedings was in conformity with the same. The assessing officer cannot presupposes what the Supreme Court was going to hold in Orissa State Warehousing Corpn. The exercise of power under section 148 by assessing officer was to implement Supreme Court judgment and not change of his opinion. Therefore, the reopening was valid and sustainable. The judgment in the case of Kartikeya International () 329 ITR 539 (All) is squarely applicable to assessee's facts. Respectfully following the same the theory of reassessment based on change of opinion is not applicable to assessee's case as the assessing officer was implementing the law of the land as declared by the Supreme Court. Thus, there is no force in the contention raised by the assessee in its cross-objections for both the assessment years in question. Thus, the issue of re-opening of assessments is decided in favour of revenue and against the assessee. Consequent, the result of revenue's appeals and assessee's C.Os for assessment years 1995-96 & 1996-97 will remain as held in Tribunal's consolidated order dated 31-3-2008. [Para 5.1]

Income Tax Act, 1961, Section 147

Income Tax Act, 1961, Section 148

IN THE ITAT, DELHI BENCH 'A'

R.P. TOLANI (J.M) & SHRI SHAMIM YAHYA

ACIT Co. v. Central Warehousing Corporation & Vice Versa

ITA Nos. 2865 & 2866/Del/2003 CO. Nos. III & 112/Del/2006

A.Y. 1995-96 & 1996-97

9 September, 2011

Department by : H.L. Dhihana CIT DR