Yogini Bipin Soneta vs Income Tax Officer Ward ...
2022 Latest Caselaw 10 Bom

       Digitally
       signed by
       MEERA                                          1/4                           904-2817-19.doc
MEERA  MAHESH
MAHESH JADHAV
JADHAV Date:
       2022.01.05
       18:20:25                IN THE HIGH COURT OF JUDICATURE AT BOMBAY
       +0530
                                  ORDINARY ORIGINAL CIVIL JURISDICTION
                                      WRIT PETITION NO.2817 OF 2019

              Yogini Bipin Soneta                                   ....Petitioner
                        V/s.

              Income Tax Officer Ward 29(3)(2)
              Mumbai & Ors.                                         ...Respondents
                                                 ----

Mr. Devendra H. Jain a/w Ms Radha Halbe for Petitioner Mr. Sham V. Walve for Respondents Revenue

----

CORAM : K.R. SHRIRAM & R. N. LADDHA, JJ DATED : 3rd JANUARY 2022

P.C. :

1 Petitioner is challenging a notice dated 25 th March 2019 issued under

Section 148 of the Income Tax Act 1961 (the Act) and the subsequent order

dated 27th August 2019 disposing petitioner's objections to the impugned

notice.

2 Petitioner had filed return of income on 24 th July 2012 for A.Y.-2012-

2013 disclosing gross total income of Rs.3,73,216/- and total taxable

income of Rs.3,56,250/-. The return was processed under Section 143(1) of

the Act. Thereafter, petitioner received the notice dated 25 th March 2019

under Section 148 of the Act which is impugned in this petition. In

response to petitioner's request, petitioner received reasons for re-opening

by a communication dated 20 th June 2019. In the reasons, it is alleged that

the Assessing Officer has received information that one Aricent Infra Ltd.

was a penny stock scrip and petitioner has traded in this scrip during F.Y.-

              Meera Jadhav
                                           2/4                      904-2817-19.doc

2011-2012 and the total transaction amount was Rs.36,54,920/-. According

to the Assessing Officer, the assessee has filed the return declaring total

income of Rs.3,56,250/- and the assessee has shown the income from salary

at Rs.2,25,000/-, income from house property at Rs.1,22,640/-, income

from short term capital gains of Rs.22,459/- and income from other sources

at Rs.3,027/-. According to the Assessing Officer, assessee ought to have

offered the income on the above said transactions for taxation and further

as there is no information available on Income Tax Department (ITD

system) regarding the penny stock, the same needs verification. Petitioner

filed objection to the reasons which was rejected by an order dated 27 th

August 2019, which is also impugned in this petition.

3 Mr. Jain attacked the reasons on two points namely; a) the reasons

should have stated the assessee ought to have offered income on the above

said transactions for taxation and not ought to have not offered the income

and, therefore, there is non application of mind by the Assessing Officer as

well as the sanctioning authority and b) no assessment can be reopened for

verification and he relied upon the judgment of a Division Bench of Gujarat

High Court in Principal Commissioner of Income Tax-5 Vs. Manzil

Dineshkumar Shah1. Mr. Jain submitted that the Supreme Court had refused

to interfere in the Special Leave Petition filed by the Revenue against the

order of Gujarat High Court. Mr. Jain submitted relying on Manzil

Dineshkumar Shah (supra) that reopening of the assessment would not be

1 (2018) 95 taxmann.com 46 (Gujarat)

Meera Jadhav 3/4 904-2817-19.doc

permitted for fishing or roving inquiry and the moment reasons recorded

says, "the same needs verification", it means that the re-opening was a

fishing or roving inquiry, which is not permissible.

4 Per contra, Mr. Walve opposes the petition and submitted that court

should not exercise its jurisdiction under Article 226 of the Constitution of

India. Mr. Walve submitted that after the notice under Section 148 of the

Act was issued, petitioner filed its return of income in compliance with the

notice on 2nd May 2019 showing upward revision. Mr. Walve submitted that

petitioner had earlier filed returns on 24 th July 2012 declaring a gross total

income of Rs.3,73,216/- and only after petitioner received the notice dated

25th March 2019 under Section 148 of the Act, that this upward revision was

disclosed to the Income Tax authorities. Mr. Walve submitted that petitioner

would have otherwise not paid the tax which was due and petitioner's

explanation that by oversight a short term capital gain on a scrip named

Vikas Wsp Ltd. or that petitioner inadvertently skipped capital gain in its

original return of income is nothing but an after thought. Mr. Walve also

relied upon explanation 3 to Section 147 as it then was in force to submit

that for the purpose of assessment or reassessment under Section 147, the

Assessing Officer may assess or reassess the income in respect of any issue

which has escaped the assessment and such issue comes to his notice

subsequently in the course of the proceedings under this Section,

notwithstanding that the reasons for such issue have not been included in

the reasons recorded under sub-Section (2) of Section 148 of the Act.

Meera Jadhav
                                          4/4                        904-2817-19.doc




5         We have considered the submissions made by the counsel and also the

pleadings filed. Admittedly, petitioner had not offered to tax the short term

capital gains on scrip named Vikas Wsp Ltd. Admittedly, it was offered only

after petitioner received the notice under Section 148 of the Act. Even if,

we hold that the reasons are not very happily worded, still the fact that

petitioner after almost 6 years and after receiving the notice under Section

148 filed return showing upward revision, itself would mean that the

Assessing Officer would be entitled to reopen the assessment. Though, we

would agree with Mr. Jain that reopening of the assessment is not permitted

for fishing or roving inquiry or for verification purpose, still the fact that

petitioner has filed returns in response to the notice under Section 148 of

the Act and disclosing therein that short term capital gains earned in F. Y.-

2011-2012 was not offered to tax, would itself entitle the Assessing Officer

to issue notice under Section 142(1) of the Act calling for further details. If

we interfere, the Revenue may suffer.

6 In the circumstances, we do not wish to exercise our jurisdiction

under Article 226 of the Constitution of India. Petitioner may adopt the

alternate remedy that is available under the provisions of the Act. Keeping

open all rights and contentions of petitioner to be raised before the

Assessing Officer, petition dismissed.

(R. N. LADDHA, J)                                          (K.R. SHRIRAM, J.)


Meera Jadhav