R.K.AGRAWAL, J. - (1.) BY means of the present writ petition filed under Article 226 of the Constitution of India, the petitioner, M/s Universal Subscription Agency Private Limited, seeks the following reliefs: (i) issue a writ, order or direction in the nature of certiorari quashing the notices dated 25.10.2000 and 4.9.2000 (Annexure - IV, V, VI & IX) issued under Section 147/148 of the Act for the assessment years 1992 -93, 1993 -94, 1994 -95 & 1997 -98. (ii) to issue a writ, order or direction in the nature of mandamus restraining the respondent not to proceed further in pursuance of the impugned notices dated 25.10.2000 and 4.9.2000 (Annexure IV, V, VI & IX) issued under Section 147/148 of the Act for the assessment years 1992 -93, 1993 -94, 1994 -95 & 1997 -98. (iii) issue any other suitable writ, order or direction as this Hon'ble Court may deem fit and proper. (iv) Award cost of the petitioner to the petitioner.
(2.) BRIEFLY stated, the facts giving rise to the present petition are as follow: According to the petitioner, it has been incorporated as a private limited company under the provisions of the Companies Act, 1956. It is engaged in the business as a subscription agent of foreign technical and scientific journals and other information products. It mainly deals in the subscription business and does not store various foreign magazines and periodicals etc. It merely receives commission through subscription of various types of magazines and journals. The petitioner filed its return of income for the assessment years 1992 -93, 1993 -94, 1994 -95 & 1997 -98 showing the income of Rs. 13,12,740/ -, Rs. 12,35,820/ -, Rs. 25,52,747/ - and Rs. 56,71,174/ - respectively. The Deputy Commissioner of Income Tax, Special Range II, Kanpur who was the Assessing Authority of the petitioner, passed assessment orders for the assessment years 1992 -93, 1993 -94 and 1994 -95 on 28.10.1993, 8.3.1994 and 16.12.1994 respectively determining the total income at Rs. 9,24,590/ -, Rs. 15,26,020/ - and Rs. 27,54,194/ - respectively. The Assessing Authority considered the claim made by the petitioner under Section 80 -O of the Income Tax Act (hereinafter referred to as 'the Act') and while passing the assessment order, allowed a sum of Rs. 4,97,808/ -, Rs. 5,26,698/ - and Rs. 3,15,543/ - respectively. In the assessment order passed for the assessment year 1992 -93, the Assessing Authority while allowing the claim has observed as follows: Viewed with reference to the above provisions of law, the assessee is found to have satisfied and fulfilled the following conditions entitling it to a deduction allowable under Section 80 -O of the Act: (a) The assessee company has received commission from foreign enterprises for services rendered outside India. (b) Database with the help of advance computers concerning various research products, activities, books, periodicals, corporate publications, technical reports, patents and standards for use by its foreign clients. (c) Commission has been received in convertible foreign exchange which is U.S. Dollar and Great Britain Pound. According to the petitioner, while passing the assessment order for the assessment year 1992 -93, the Assessing Authority had worked out the net commission earning from the services rendered to foreign enterprises at Rs. 9,95,616/ - and relief under Section 80 -O of the Act was allowed at 50% amounting to Rs. 4,97,808/ -. So far as the assessment year 1997 -98 is concerned, according to the petitioner, it had not received any notice under Section 143(2) of the Act. However, an intimation under Section 143(1)(a) of the Act was received.
(3.) THE Joint Commissioner of Income Tax, Special Range, Kanpur, the sole respondent, issued notices dated 25.10.2000 under Section 147/148 of the Act for the assessment years 1992 -93, 1993 -94 and 1994 -95 proposing to assess the escaped income. In respect of the assessment year 1997 -98, notice under Section 147/148 had been issued on 4.9.2000. The respondent had also supplied the reasons recorded by him for forming the belief that the income has escaped income during the aforesaid assessment years. According to the respondent, the petitioner was not entitled to get deduction under Section 80 -O of the Act and the wrongful claim has resulted into an escaped assessment to the extent of relief allowed in each of the assessment years. All the notices are under challenge in the present writ petition on the ground that the jurisdictional foundation for initiating the proceedings under Section 147 which deals with the income escaping assessment, is totally absent. In the present case, it is merely a change of opinion by the subsequent Assessing Authority, which is not permissible under Section 147 of the Act. The petitioner had disclosed all the primary facts which have direct bearing on the liability of income earned by him, which is the subject matter of tax and the Assessing Officer came to the conclusion that it was entitled for the benefit of Section 80 -O of the Act and had allowed deduction accordingly and mere use of the phrase 'reason to believe' would not be a sufficient ground to initiate proceeding under Section 147 of the Act. No new material has come on record and, therefore, it is only a fresh application of mind by the Assessing Authority on the same set of fact and law which were in existence when the original assessment orders were passed. The application of Section 147 and issuance of notices under Section 148 is nothing but abuse of process of law. It is not the case of the Department that in the original assessment the income liable to tax has escaped assessment due to oversight or inadvertent mistake committed by the Assessing Officer but it has been reopened only on the ground that the opinion formed earlier by his predecessor was not correct. There is no power of review and the proceedings which have been initiated, are palpably arbitrary and the entire exercise is void. The notices issued under Section 147/148 of the Act are barred by limitation and, in any event, the petitioner is entitled for deduction under Section 80 -O of the Act which has rightly been allowed.;