Law:

Section:

Section 147 of the Income-tax Act 1961 - Income escaping assessment - General - Assessment year 1995-96 Where exemption under section 54 had been allowed during scrutiny assessment in respect of capital gains, reassessment to withdraw such exemption amounted to change of opinion and was not justified [In favour of assessee] The assessee's assessment was taken up for scrutiny under section 143(3) of the Act. At that point of time, the sale of house property by the assessee for a consideration of Rs. 18,00,000 was very much known to the assessing authority. The assessee admitted the capital gain of Rs. 6,07,035. The assessment was concluded under section 143(3) and was completed on 27-2-1997, which determined the capital gain of Rs. 1,00,000 as against 'nil' capital gain determined earlier under section 143(1)(a ). The deduction claimed by the assessee under section 54 to the extent of Rs. 12,50,000 was allowed at that point of time. It was only thereafter, the present reassessment proceedings came to be initiated by issuing notice under section 148. The alleged escapement of capital gain was taxed on the sum of Rs. 1,37,788, which was earlier allowed under section 54 in the proceedings. The Commissioner (Appeals), took the view that it was not really a case of escaped assessment, but was one of change of opinion by the assessing authority. The Tribunal also confirmed his view. Held that no question of law, much less a substantial question of law arose for consideration. CASES REFERRED TO CIT v. Foramer France [2003] 264 ITR 566 (SC) (para 5). T. Ravikumar for the Appellant. JUDGMENT F.M. Ibrahim Kalifulla, J. -The Revenue has come forward with this appeal raising the following substantial question of law : "Whether on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the reopening of assessment under section 147 was not proper and denial of exemption under section 54 was bad for the assessment year 1995-96 ?" 2. As it is seen from the order of the assessing authority passed under section 143(3) read with 147 of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), the assessee's return for the assessment…

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