Bombay High Court rules: Release to Vodafone Idea, simple change of Outlook of the AO can't be reason to Revive Valuation

Bombay High Court rules: Release to Vodafone Idea, simple change of Outlook of the AO can't be reason to Revive Valuation

Vodafone Idea's big relief, the Bombay High Court held that simple change of AO's views cannot be the reason to renew valuation.

Issued under Section 148 of the Income Tax Act 1961 for A.Y.-2013-2014, the Petitioner, Vodafone Idea Ltd. has issued the impugning notice. It was also for quashing an order on 5th December 2019 passed by respondent disposing of the objections. It was filed by petitioner against initiation of reassessment proceedings for A.Y.-2013-2014.

Under Section 115JB of the Act, A.Y. 2013-2014 petitioner filed return of income on 30th November 2013 declaring total income at loss under normal provisions and Rs.273 crores. As shown in original return of income, the revised return of income was also filed declaring income. Under Section 143(3) of the Act, the assessment was completed on 30th December 2016. It determines total income under normal provisions and under Section 115Jb of the Act.

On the available documents and submissions before the Assessing Officer, before passing of the original assessment order, the coram of Justice R.N.Laddha and Justice K.R.Shriram held that the entire basis for proposing to reopen, as can be seen from the reasons. In fact, it is also recorded that the same issue was considered by the earlier Assessing Officer during the assessment proceedings.

The Assessing Officer notes that the assesse had made submissions on these items before but still comments that income on expenses to tax has escaped because in his opinion certain amounts are required to be added back in profit and loss account and certain amounts should not have been rejected. One view is conclusively taken by the Assessing Officer where on consideration of material on record. It would not be open to reopen the assessment based on the very same material with a view to take another opinion.

"We are contented that the petitioner had truly and totally revealed all the material facts necessary for the purpose of assessment. Not only material facts were disclosed by the petitioner truly and fully but they were sensibly inspected and figures of income and deduction were revised carefully by the Assessing Officer. In the reasons for reopening, there is not even a whisper as to what was not disclosed.

The court said," In our view, this is not a case where the assessment is required to be reopened on the rational belief that income had escaped assessment on account of failure of the assesse to disclose truly and fully all material facts that were necessary for computation of income but this is a case wherein the valuation is sought to be reopened on account of change of opinion of the Assessing Officer."