Hon'ble Itat in the case of Kalyani Chaturvedi has quashed the re-assessment order as Re-appreciation of seized material in subsequent proceedings by the AO is unjustified
All facts were all along were within the knowledge of the AO at original assessment stage, therefore, reappreciation
of evidence at subsequent re-assessment proceedings is not permitted
on mere change of opinion by subsequent AO. The re-assessment proceedings
have been initiated again on similar issue and totally on identical facts regarding
investment in property which have already been considered in the original
assessment proceedings. It is, therefore, a case of change of opinion and such a
change of opinion for reopening of section 147 is not permitted under law. The AO
in the re-assessment order himself has mentioned that addition is made on account
of unexplained expenditure/investment in the properties in the original assessment
order. Such facts recorded by the AO in the reassessment order clearly strengthen
the stand of the assessee for quashing of reassessment proceedings. No new
material or fresh information have been received at the re-assessment stage.
Therefore, it is merely a fresh application of mind by the subsequent AO on the
same set of facts. The contention of the ld. DR is, therefore, liable to be rejected
that investment in property was not considered at the original assessment stage.
Further, the same seized material, i.e., Annexure A1, which was the basis of
making some additions at original assessment stage, is the document of the
department found during the course of search and once the same has been
appreciated and considered by the AO, there is no question on the part of the
assessee not to disclose fully and truly all material facts necessary for his
assessment. The re-appreciation of seized material in subsequent proceedings by
the AO is, thus, wholly unjustified particularly when such a seized material was
not considered worthy by the ld. CIT(A) in the original appellate proceedings
deleting the addition on the same seized material. Therefore, there is no question of
re-appreciating the same facts which have been duly considered by the first
appellate authority prior to reopening of assessment. The ld. CIT(A), therefore, on
proper appreciation of facts and material on record, rightly quashed the
reassessment proceedings. We, therefore, do not find any infirmity in the order of
the ld. CIT(A) in quashing and annulling the reassessment order. The departmental
appeal thus fails and is accordingly dismissed.
copy of case law attached
All facts were all along were within the knowledge of the AO at original assessment stage, therefore, reappreciation
of evidence at subsequent re-assessment proceedings is not permitted
on mere change of opinion by subsequent AO. The re-assessment proceedings
have been initiated again on similar issue and totally on identical facts regarding
investment in property which have already been considered in the original
assessment proceedings. It is, therefore, a case of change of opinion and such a
change of opinion for reopening of section 147 is not permitted under law. The AO
in the re-assessment order himself has mentioned that addition is made on account
of unexplained expenditure/investment in the properties in the original assessment
order. Such facts recorded by the AO in the reassessment order clearly strengthen
the stand of the assessee for quashing of reassessment proceedings. No new
material or fresh information have been received at the re-assessment stage.
Therefore, it is merely a fresh application of mind by the subsequent AO on the
same set of facts. The contention of the ld. DR is, therefore, liable to be rejected
that investment in property was not considered at the original assessment stage.
Further, the same seized material, i.e., Annexure A1, which was the basis of
making some additions at original assessment stage, is the document of the
department found during the course of search and once the same has been
appreciated and considered by the AO, there is no question on the part of the
assessee not to disclose fully and truly all material facts necessary for his
assessment. The re-appreciation of seized material in subsequent proceedings by
the AO is, thus, wholly unjustified particularly when such a seized material was
not considered worthy by the ld. CIT(A) in the original appellate proceedings
deleting the addition on the same seized material. Therefore, there is no question of
re-appreciating the same facts which have been duly considered by the first
appellate authority prior to reopening of assessment. The ld. CIT(A), therefore, on
proper appreciation of facts and material on record, rightly quashed the
reassessment proceedings. We, therefore, do not find any infirmity in the order of
the ld. CIT(A) in quashing and annulling the reassessment order. The departmental
appeal thus fails and is accordingly dismissed.
copy of case law attached
Regards
Prarthana Jalan
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