Facts of the Case

The petitioner filed his income tax return for AY 2017–18 declaring income of ₹28,42,430. The case was selected for scrutiny and assessment was completed under Section 143(3), wherein an addition of ₹28,75,000 was made under Section 69A relating to cash deposits of ₹34,54,500 during demonetisation.

The petitioner challenged this assessment before the CIT(A), and the appeal was pending.

During pendency of the appeal, a reassessment notice under Section 148 was issued for a different cash deposit of ₹12,50,000 in other bank accounts. Subsequently, reassessment under Section 147 read with Section 144B resulted in further addition of ₹12,50,000 treating it as unexplained income.

The petitioner filed writ petitions challenging both the reassessment notice and order.

Issues Involved

  1. Whether reassessment under Sections 147/148 is valid when an appeal is pending before CIT(A) under Section 251?
  2. Whether reassessment amounts to change of opinion when earlier scrutiny assessment was completed?
  3. Whether reassessment proceedings violate principles of natural justice?

Petitioner’s Arguments

  • The reassessment was invalid as the original assessment was completed after full disclosure.
  • Issuance of notice during pendency of appeal before CIT(A) encroached upon appellate jurisdiction under Section 251.
  • The reassessment was based on review of same material, amounting to change of opinion.
  • All cash deposits were already disclosed during original assessment proceedings.
  • The reassessment order was passed without proper consideration of replies, violating natural justice.

Respondent’s Arguments

  • The reassessment concerned different cash deposits (₹12,50,000) not examined in original assessment.
  • There was no formation of opinion earlier, hence no question of change of opinion.
  • Powers under Section 147 are independent and can be exercised even when appeal is pending under Section 251.
  • The assessee failed to disclose complete details of all bank accounts and deposits.

Court’s Findings / Order

  • Reassessment is valid where the issue was not examined in original assessment, hence no “change of opinion.”
  • Cash deposits of ₹12,50,000 were not subject matter of earlier assessment, which dealt with different deposits.
  • Powers under Section 147 are independent and not barred by pending appellate proceedings under Section 251.
  • The concept of change of opinion applies only when an issue was previously examined.
  • The assessee had not disclosed all bank accounts in the return.
  • Writ petitions are not maintainable when statutory remedies are available.

Final Order:
Writ petitions dismissed with liberty to approach appellate authority.

Important Clarifications

  • No Change of Opinion Doctrine: Applies only when an issue was examined earlier; not where no opinion was formed.
  • Independent Jurisdiction: Section 147 reassessment powers are independent of appellate powers under Section 251.
  • Different Transactions: Reassessment can proceed if it concerns a different issue than the one under appeal.
  • Disclosure Requirement: Failure to disclose full bank account details weakens assessee’s case.
  • Writ Jurisdiction: Not maintainable where alternate remedy exists under Income Tax Act.

Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2022:DHC:2744-DB/MMH22072022CW60362022_190746.pdf


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