M.A. Bakshi,V.P. - (1.) APPEAL of the revenue for assessment year 1994-95 is directed against the order dated 30-12-2002 of the Commissioner of Income Tax (APPEALs), Chandigarh, We have heard the parties and perused the records.
(2.) The relevant facts briefly stated are that assessee had filed the return of income for assessment year 1994-95 on 31-10-1994, which was processed under section 143(1)(a) on 31-3-1995. The assessee had revised the return of income on 27-10-1995 in order to claim the set off of brought forward losses. The assessment was made under section 143(3) vide order dated 28-12-1995. In the return of income, assessee had claimed deduction under section 80-I for the first time, as in earlier years, there were no profits. The assessing officer in para 3 of the assessment order recorded as under : "The claim of the assessee under section 80-I of the Income Tax Act has been made for the first time this year since this is the sixth year of the assessee after commencing production and prior to this there has beenno income." Subsequently, assessment was made for assessment year 1995-96 and claim under section 80-I disallowed for that assessment year. Consequently to the investigation and framing of assessment for assessment year 1995-96, the assessing officer issued a notice under section 148 for assessment year 1994-95 in response to which assessee filed the return of income on 5-3-1999 declaring income of Rs. 37,69,485. The assessing officer completed the assessment under section 143(3) read with section 147 at Rs. 47,11,857. Assessee appealed to the Commissioner of Income Tax (Appeals) and the latter vide para 2.3 of the order held as under : "The submissions of the appellant have been considered carefully and I am of the opinion that the assessing officer only changed his opinion when he made a fresh assessment. The issue of deduction under section 80-I had been present in the mind of the assessing officer right from the beginning. The proceeding cannot be justified since it has never been the case of the assessing officer that there was non-availability of any of the particulars that constitute primary facts in the nature of materials necessary for proper assessment. It is only on the basis of changed view that the assessing officer proceeded in the case under section 148. Considering the facts and circumstances of the case and respectfully following the order of Calcutta High Court in the case of ITO v. Jiyajeerao Cotton Mills Ltd, 164 CTR 619, I am of the view that the reassessment proceedings are illegal and cannot stand in the test of justice. The addition made by the assessing officer, by invoking the provisions of section 148 on account of disallowing the deduction under section 80-I is, therefore, ordered to be deleted." No reason was, however, recorded by the Commissioner of Income Tax (Appeals) on merits. Revenue is in appeal.
(3.) THE learned Departmental Representative contended before us that the Commissioner of Income Tax (Appeals) has wrongly cancelled the assessment made under section 143(3), read with section 147. It was contended that though assessment under section 143(3) had been made by the assessing officer, the assessee had not disclosed the relevant facts relating to the taking over of the entire plant from the Punjab Dairy Development Corporation Ltd., and had wrongly claimed deduction under section 80-I. According to the learned Departmental Representative, there is no change of opinion in so far as the assessing officer had not expressed any opinion in regard to the facts found subsequent to the assessment. Reliance was placed on the decision of the Punjab & Haryana High Court in the case of Venus Industrial Corpn. v. Assistant CIT (1999) 236 ITR 742 (Punj & Har), in support of the contention that reopening of assessment is valid if in subsequent year new facts are found justifying the reopening of assessments in earlier years. Reliance was also placed on the following decisions to support the contention that reopening of assessment is permissible on the basis of facts found in subsequent assessment year : (i) Gurera Gas Cylinders (P) Ltd. v. CIT (2002) 258 ITR 170 (P&H); (ii) Swaraj Engine Ltd. v. Assistant CIT (2003) 260 ITR 202 (P&H); (iii) Happy Forging Ltd. v. CIT (2002) 253 ITR 413 (P&H); (iv) Babu Ram Nagar Mal v. ITO (1996) 222 ITR 450 (P&H); (v) Kumar Engineers v. CIT (1997) 223 ITR 18 (P&H); (vi) Sukhjit Starch & Chemicals Ltd. v. Deputy CIT (2004) 85 TTJ (Asr) 218. It was further contended that in this case notice under section 148 had been issued within four years and, therefore, the restriction for reopening of assessment after four years under section 147 is inapplicable. It was accordingly pleaded that the order of the Commissioner of Income Tax (Appeals) may be set aside and that of the assessing officer restored.;