Reopening of Assessment Not Permissible for Change of Opinion

Skoda Auto Volkswagen India Private Limited Vs ACIT (Bombay High Court)

Petitioner had in its annual report mentioned about the technical know how fee, royalty and technical assistance fee that it had paid to Skoda Auto a.s. and Volks Wagen AG. Petitioner had also filed Form 3CEB in which it had disclosed about details and description of international transactions in respect of know how and patents and it had disclosed the details regarding royalty paid and lump sum fees for know how paid to Skoda Auto a.s. and fees for technical services paid to Volks Wagen AG. Before the original assessment order was passed, the Transfer Pricing Officer also had raised all these queries and passed his transfer pricing order dated 19^th December 2006 which Mr. Agrawal states has been challenged separately before the Commissioner of Income Tax (Appeals). Even in this order by the Transfer Pricing Officer passed on 19^th December 2006 under Section 92CA (3) of the said Act, the Transfer Pricing Officer has considered the royalty, technical know how amounts paid and passed his order. This order of the Transfer Pricing Officer has been considered by the Assessing Officer while passing the original assessment order dated 29^th December 2006 under Section 143 (3) of the said Act. Therefore, there can be nothing which has not been truly and fully disclosed and we cannot accept the submissions of Mr. Walve that explanation 1 to Section 147 provides that production before the Assessing Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer is no defence. Petitioner has not only filed its account books and other evidence but those have been considered by the Transfer Pricing Officer whose order also has been considered by the Assessing Officer while passing the original assessment order.

 In our view, the reasons recorded for reopening is nothing but a change of opinion which is not permissible in law.

In the circumstances, we are satisfied that the notice dated 23^rd March 2011 issued under Section 148 of the said Act has been issued after illegally assuming jurisdiction under Section 148 of the said Act. Therefore, we are inclined to and hereby allowed the petition

FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT

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