Pushpa Devi vs Union Of India (2025:Rj-Jd:41738-Db)
2025 Latest Caselaw 13406 Raj

Rajasthan High Court - Jodhpur

Pushpa Devi vs Union Of India (2025:Rj-Jd:41738-Db) on 18 September, 2025

[2025:RJ-JD:41738-DB]

      HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
                       JODHPUR
                 D.B. Civil Writ Petition No. 4151/2022
Pushpa Devi W/o Damodar Das, Aged About 63 Years, 568,
Subhash Nagar Ii, Kheme Ka Kua, Pal Road, Jodhpur.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through The Secretary Finance, Ministry
         Of Finance, North Block New Delhi - 110001.
2.       Principal Chief Commissioner Of Income Tax (Nafac),
         North Block, New Delhi - 110001.
3.       Additional/joint/deputy/assistant                  Commissioner/income
         Tax Officer, National Faceless Assessment Centre, North
         Block New Delhi - 110001.
4.       Income Tax Officer, Ward - 3(1), Aaykar Bhawan, Paota C
         Road, Jodhpur.
                                                                    ----Respondents


For Petitioner               :     Mr. Sharad Kothari
                                   Mr. Mayank Tapariya
                                   Mr. Pranjul Mehta
                                   Mr. Kalpit Shishodia
                                   Mr. Dinesh Kumar Bishnoi
                                   Mr. Mahesh Kaliya
For Respondents              :     Mr. K.K Bissa
                                   Mr. G.S Chouhan



       HON'BLE THE CHIEF JUSTICE MR. K.R. SHRIRAM
          HON'BLE MRS. JUSTICE SANGEETA SHARMA

Order

18/09/2025

1. Petitioner is impugning reassessment notice dated 30 th March

2021 and order dated 14th February 2022 rejecting his objections.

2. Petitioner is an individual who filed return of income dated

14th March 2015 in terms of Section 139(1) of the Income-Tax Act

1961 (for short, 'the Act') for Assessment Year 2014-15. Petitioner

declared net total income of Rs. 4,66,990/-.

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3. Petitioner's return was selected for compulsory scrutiny

pursuant to which a notice dated 19th September 2015 was issued

to petitioner. Thereafter another notice dated 07 th April 2016, was

issued to petitioner, calling upon to provide various details and

information, one of which was regarding immovable properties

purchased and sold during financial year under consideration. In

response, petitioner vide Chartered Accountant's letter (undated)

provided the details of immovable property purchased being land

for farm house plot No.2, size 3058.90 Sq Mts. situated at Khasra

No. 387 and 3888, Village Jhalamand, Tehsil and District Jodhpur.

It was also disclosed that plot was registered in favour of

petitioner on 29th May 2013 for a consideration of Rs. 20,00,000/-

and cost of stamps and registration etc was Rs. 8,12,220/-. It was

further disclosed that property in question was purchased on 17 th

March 2005 by deceased husband of the petitioner for a

consideration of Rs. 20,00,000/- out of which Rs. 17,00,000/-

were paid on 17th March 2005 and balance amount of Rs.

3,00,000/- was paid on 29 th May 2013. Following this, an

assessment order dated 21st December 2016 was passed under

Section 143(3) of the Act accepting the explanation and also the

return filed without any change.

4. Almost four and half years later petitioner received a notice

dated 30th March 2021 under Section 148 of the Act. Petitioner

also received "reasons to believe" by a communication dated 11 th

November 2021. "Reasons to believe" also mention that petitioner

had purchased the said property at a value much lower than the

value under Section 50C of the Act and also had made certain

cash payments and therefore a sum of Rs. 1,23,57,561/- has

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escaped assessment within the meaning of Section 147 of the Act.

Petitioner filed objections which came to be rejected vide

impugned order dated 14th February 2022.

5. Mr. Mehta appearing for petitioner submitted that as the

notice under Section 148 was issued after expiry of four years

from the end of relevant Assessment Year and there was an

assessment made under Section 143(3) of the Act, the first

proviso to Section 147 of the Act shall apply under which no action

can be taken unless any income chargeable to tax has escaped

assessment by reason of failure on the part of assessee to disclose

fully and truly all material facts necessary for that assessment

year. He also submitted that there are plethora of judgments on

this issue from various High Courts and the Supreme Court. It was

also submitted that during the course of assessment proceedings

specific query was raised vide notices dated 19th September 2015

and 07th April 2016 under Section 143(2) of the Act asking

petitioner to provide details of immovable properties purchased

during assessment year and petitioner through a Chartered

Accountant had replied giving details of the said property

purchased.

6. Mr. Mehta further submitted that after considering the reply

and giving a personal hearing, assessment order dated 21 st

December 2016 under Section 143(3) came to be passed under

which Assessing Officer notes that representative presented all

documents and details and being satisfied with the explanation, no

addition was made and the return of income as filed was accepted.

7. It was also submitted that once a query is raised during

assessment proceedings and assessee has replied to it, it follows

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that query raised was the subject of consideration of Assessing

Officer while completing assessment and it is not necessary that

an assessment order should contain reference and/or discussions

to disclose its satisfaction in respect of query raised. Reliance was

placed in a judgment of the Division Bench of Bombay High Court

(authored by one of us- The Chief Justice) in DCW Limited. vs.

Assistant Commissioner of Income Tax1

8. Mr. Bissa submitted that assessment order under Section

143(3) does not contain any discussion that matter was under

active consideration of Assessing Officer and hence, Department

was justified in reopening assessment.

9. In rejoinder, Mr. Mehta submitted that such a submission of

revenue has been rejected by Bombay High Court in DCW Ltd.

(supra).

10. We would agree with the submissions of Mr. Mehta in as

much as proviso to Section 147 of the Act states that where an

assessment order under Section 143(3) of the Act has been

passed and more than four years had expired from the end of

relevant assessment year, unless any income chargeable to tax

has escaped assessment for such assessment year by reason of

the failure on the part of assessee to disclose fully and truly all

material facts necessary for assessment for that assessment year,

reopening of assessment is not permissible.

11. In this case, admittedly assessment order under Section

143(3) of the Act has been passed and more than four years have

expired from the end of the relevant assessment year, therefore,

proviso to Section 147 applies. Moreover, during the course of

1 MANU/MH/4730/2023

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assessment proceedings petitioner was called upon to provide

details of immovable properties purchased during assessment year

and in response petitioner provided the details. While disposing

the objections, there is no denial that these details were furnished

but it was observed that the phrase "reasons to believe" would

mean the cause or justification for the Assessing Officer to know

or suppose that income has escaped assessment. It does not

mean that Assessing Officer should have finally ascertained the

fact by legal evidence or conclusion. He also denies that there is

change of opinion.

12. In our view, as held by the Division Bench of Bombay High

Court in Aroni Commercials Limited vs. The Dy.

Commissioner of Income Tax-2(1)2, once a query is raised

during assessment proceedings and assessee has replied to it, it

follows that query raised was the subject of consideration of the

Assessing Officer while completing the assessment. It is not

necessary that an assessment order should contain reference and/

or discussions to disclose a satisfaction in respect of query raised.

Relevant para Nos. 14, 19 & 20 reads as under:-

"14. We find that during the assessment proceedings the petitioner had by a letter dated 9 July 2010 pointed out that they were engaged in the business of financing trading and investment in shares and securities. Further, by a letter dated 8 September 2010 during the course of assessment proceedings on a specific query made by the Assessing Officer, the petitioner has disclosed in detail as to why its profit on sale of investments should not be taxed as business profits but charged to tax under the head capital gain. In support of its contention the petitioner had also relied upon CBDT Circular No.4/2007 dated 15 June 2007. (The reasons for reopening furnished by the Assessing Officer also places reliance upon CBDT Circular dated 15 June 2007). It would therefore, be noticed that the very ground on which the notice dated 28 March 2013 seeks to reopen the assessment for assessment year 2008-09 was considered by the Assessing Officer while originally passing assessment order dated 12 October 2010. This by itself demonstrates the fact that notice dated 28 March 2013

2 2014(44)taxmann.com 304(bombay)

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under Section 148 of the Act seeking to reopen assessment for A.Y. 2008-09 is based on mere change of opinion. However, according to Mr. Chhotaray, learned Counsel for the revenue the aforesaid issue now raised has not been considered earlier as the same is not referred to in the assessment order dated 12 October 2010 passed for A.Y. 2008-09. We are of the view that once a query is raised during the assessment proceedings and the assessee has replied to it, it follows that the query raised was a subject of consideration of the Assessing Officer while completing the assessment. It is not necessary that an assessment order should contain reference and/or discussion to disclose its satisfaction in respect of the query raised. If an Assessing Officer has to record the consideration bestowed by him on all issues raised by him during the assessment proceeding even where he is satisfied then it would be impossible for the Assessing Officer to complete all the assessments which are required to be scrutinized by him under Section 143(3) of the Act. Moreover, one must not forget that the manner in which an assessment order is to be drafted is the sole domain of the Assessing Officer and it is not open to an assessee to insist that the assessment order must record all the questions raised and the satisfaction in respect thereof of the Assessing Officer. The only requirement is that the Assessing Officer ought to have considered the objection now raised in the grounds for issuing notice under Section 148 of the Act, during the original assessment proceedings. There can be no doubt in the present facts as evidenced by a letter dated 8 September 2012 the very issue of taxability of sale of shares under the head capital gain or the head profits and gains from business was a subject matter of consideration by the Assessing Officer during the original assessment proceedings leading to an order dated 12 October 2010. It would therefore, follow that the reopening of the assessment by impugned notice dated 28 March 2013 is merely on the basis of change of opinion of the Assessing Officer from that held earlier during the course of assessment proceeding leading to the order dated 12 October 2010. This change of opinion does not constitute justification and/or reasons to believe that income chargeable to tax has escaped assessment.

xxxxxxx

19. On all the aforesaid grounds, we are of the view that the impugned notice dated 28 March2013 under Section 148 of the Act seeking to reopen the assessment for A.Y.2008-09 and the order dated 20 November 2013 rejecting the petitioner's objection to reopen the assessment for A.Y. 2008-09 are not sustainable in law. The entire proceeding for reopening the assessment for A.Y. 2008-09 had emanated only on account of change of opinion on the part of the Assessing Officer.

20. In view of the discussion in Paragraphs 3 to 7 herein above, we set aside the assessment order dated 19 December 2013. We also hold that there was no reason for the Assessing Officer to have had a reasonable belief that income chargeable to tax has escaped assessment. Accordingly, we set aside the impugned notice dated 28 March 2013 issued under Section-148 of the Act as well as the impugned order dated 20 November 2013 passed by the Assessing Officer rejecting the petitioner's objection to reopen the assessment for A.Y. 2008-09."

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13. It is settled law that change of opinion does not constitute

justification and/or reason to believe that income chargeable to

tax has escaped assessment. There can be no doubt in the

present facts that very issue of taxability of asset namely, said

property, was subject matter of consideration by Assessing Officer

during the original assessment proceedings leading to assessment

order dated 21st December 2016. It would therefore follow that re-

opening of assessment by impugned notice dated 30 th March 2021

is merely on the basis of change of opinion of Assessing Officer

from that held earlier during the course of assessment

proceedings leading to order dated 21 st December 2016. This

change of opinion does not constitute justification and/or reasons

to believe that income chargeable to tax has escaped assessment.

14. In the circumstances, Rule is made absolute in terms of

prayer clause (a) which reads as under:-

"(a) The reassessment proceedings initiated vide re-

assessment notice dated 30.03.2021(Annexure-5) and the consequent order dated 14.02.2022 (Annexure-9) disposing objections may be quashed and set aside."

15. Petition disposed. No order as to cost.

                                   (SANGEETA SHARMA),J                                           (K.R. SHRIRAM),CJ
                                    37-divyaP/-




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