“mere change of opinion”

ReassessmentSection 147Section 147952 judgments

The decision most relied on for mere change of opinion is CIT v. Kelvinator of India Ltd. (320 ITR 561), cited in 1,673 judgments on BharatTax.

Leading authorities on mere change of opinion

CIT v. Kelvinator of India Ltd.

320 ITR 561 · 2010 · Supreme Court

1,673

citing judgments

An Assessing Officer cannot initiate reassessment proceedings under Section 147 of the Income Tax Act based on a mere change of opinion. Reassessment is permissible only when there is fresh tangible material leading to the belief of income escapement, not merely a review of existing facts.

Hindustan Lever Ltd. v. R.B. Wadkar

268 ITR 332 · 2004 · High Court

695

citing judgments

The validity of reassessment proceedings initiated under Section 147, by issuing a notice under Section 148, must be judged solely on the reasons originally recorded by the Assessing Officer. These recorded reasons cannot be supplemented, improved upon, or modified at any later stage.

CIT v. Kelvinator of India Ltd.

256 ITR 1 · 2002 · High Court

439

citing judgments

An Assessing Officer cannot reopen an assessment under Section 147 based on a mere change of opinion regarding the same material available during the original assessment. Reopening requires fresh, tangible material or information that leads to a reason to believe income has escaped assessment.

CIT v. Orient Craft Ltd.

354 ITR 536 · 2013 · High Court

366

citing judgments

Reassessment of income, especially after a summary assessment under Section 143(1), requires the Assessing Officer to possess fresh, tangible material to form a reason to believe that income has escaped assessment; a mere reappraisal of existing records or a change of opinion without new material is not permissible.

CIT v. Foramer France

264 ITR 566 · 2003 · Supreme Court

253

citing judgments

Reassessment proceedings initiated under Section 147 beyond four years from the end of the relevant assessment year are invalid unless the assessee failed to disclose fully and truly all material facts necessary for assessment. Without such failure, the notice issued under Section 148 is time-barred and without jurisdiction.

Haryana Acrylic Manufacturing Company v. CIT

308 ITR 38 · 2009 · High Court

248

citing judgments

Reassessment proceedings are invalid if the reasons recorded for initiating action under section 148 are not served on the assessee within the limitation period prescribed by section 149. Furthermore, reassessment cannot be based on a mere change of opinion without tangible material, particularly when the assessee has made a full and true disclosure of material facts.

CIT v. SFIL Stock Broking Ltd.

325 ITR 285 · 2010 · High Court

243

citing judgments

Reassessment proceedings under Section 147 are invalid and void ab initio if initiated based on 'borrowed satisfaction' without the Assessing Officer's independent application of mind, or merely on documents already available on record without fresh tangible material.

CIT v. Usha International Ltd.

348 ITR 485 · 2012 · High Court

231

citing judgments

A reassessment is invalid due to 'mere change of opinion' if an issue was raised during original assessment but no addition was made, implying the issue was examined. However, if a subject matter was not examined and no opinion was formed, the principle of 'change of opinion' does not apply.

Judgments citing mere change of opinion

Paris Elysees India Pvt. Ltd., Jaipur vs. DCIT, Circle-7, Jaipur

ITA 681/JPR/2023[2012-13]Status: DisposedITAT Jaipur19 Sept 2024AY 2012-13

Bench: Him Against The Order Dated 05.12.2019 Passed Under Section 147/143(3) Of The Income Tax Act, [ For Short “Act” ] By Acit, Circle-07, Jaipur.

For Appellant: Sh. Rohan Sogani, CAFor Respondent: Sh. Anup Singh, Addl. CIT

Section 115JSection 147Section 148Section 151Section 250Section 253(5)

failing which, we are afraid, section 147 would give arbitrary powers to the Assessing Officer to re-open assessments on the basis of "mere change of opinion", which cannot be per se reason to reopen. We must also keep in mind the conceptual difference between power to review and power ... framing of original assessment, reopening of assessment by successor Assessing Officer on ground that said expenditure was not allowable, being based on mere change of opinion, could not be sustained - Held, yes [Paras 9 and 10] [In favour of assessee]” • Jaipur ITAT ACIT vs. Mangalam Cement Ltd. [2017] 78 taxmann.com

ACIT, Circle 1(1), Chandigarh vs. M/S Sml Isuzu Ltd., Chandigarh

ITA 644/CHANDI/2022[2015-16]Status: DisposedITAT Chandigarh18 Sept 2024AY 2015-16

Bench: SHRI. VIKRAM SINGH YADAV (Accountant Member), SHRI. PARESH M. JOSHI (Judicial Member)

For Appellant: Shri Rohit Jain, Advocate and Ms. Somya Jain, C.AFor Respondent: Shri Vivek Vardhan, JCIT, Sr. DR

Section 143(2)Section 143(3)Section 147Section 148Section 250Section 253Section 3

wrongly claimed by the assessee is without jurisdiction illegal and bad in law. Re (b) No new tangible material – Proceedings initiated on mere change of opinion 28. Though the powers under section 147/148 are vide, the same are not unfettered or plenary, in so far as AO in the garb ... reassessment cannot seek to review the earlier assessment framed under section 143(3) of the Act on account of mere “change of opinion”. 29. that the Reassessment cannot be initiated unless some new additional fact come on record leading to the belief of escapement of income. 30. That reasons recorded

ITO, Ward-1(1), Solapur vs. Ms. Kshirsagar Fabrics, Solapur

In the result, the appeal filed by the Revenue is dismissed

ITA 97/PUN/2024[2009-10]Status: DisposedITAT Pune17 Sept 2024AY 2009-10

Bench: Shri R. K. Panda & Ms Astha Chandraassessment Year : 2009-10

For Appellant: Shri Nikhil PathakFor Respondent: Shri Sourabh Nayak, Addl. CIT

Section 143(3)Section 147Section 148Section 40A(3)

directed against the Assessing Officer (hereinafter referred to as the AO) completing assessment u/s 147 based on a mere change of opinion. The brief fact of the case is that the appellant filed the return of Income for the Assessment year (AY) 2009-10 on 29.09.2009 declaring a total income ... failure on the part of the appellant to disclose fully and truly all material facts. The appellant submitted that it is a mere change of opinion, and AO had no reason to believe that income has escaped assessment. 5.4 I have carefully considered the facts of the case, the submission

Johar Hasan Zojwalla, Kalyan vs. ACIT, Circle 3, Kalyan

In the result, the appeal by the assessee is allowed

ITA 1669/MUM/2024[2009-10]Status: DisposedITAT Mumbai16 Sept 2024AY 2009-10

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Subodh RatnaparkhiFor Respondent: Shri Ashish Kumar, Sr. AR

Section 142(1)Section 143(2)Section 143(3)Section 147Section 148Section 2(22)(e)Section 250Section 56(2)(i)

have “reason to believe” that income chargeable to tax has escaped assessment. In the present case, reassessment proceedings are nothing but a mere change of opinion by the AO with regard to material already available on record and considered during the original scrutiny assessment proceedings. That it is settled ... taken by the AO he should substantiate his satisfaction. Thus, where the reasons recorded by the AO disclose no more than a mere change of opinion, the reassessment proceedings and assessment order pursuant thereto are liable to be quashed.The existence of a valid "reason to believe" is a sine

Big Boss Foods Pvt. Ltd., Burdwan vs. ACIT, Cir. 1, Burdwan

In the result, the appeal filed by the assessee is allowed

ITA 398/KOL/2024[2013-14]Status: DisposedITAT Kolkata11 Sept 2024AY 2013-14

Bench: Sri Rajesh Kumar & Pradip Kumar Choubey

Section 143(3)Section 147Section 148Section 151(1)Section 250Section 40

hands of Revenue leading to the view that there was reason to believe that there was escapement of assessment, there was mere change of opinion and hence notice u/s 148 of the Act is liable to be quashed. 1.3. On the contrary, ld. D/R supported the impugned order