Dinesh Kumar Goyal Huf vs Income Tax Officer Ward-43(1)
2023 Latest Caselaw 7390 Cal

17.11.2023
Item No.8
gd/ssd
                                MAT/1685/2023
                               IA NO: CAN/1/2023
                           DINESH KUMAR GOYAL HUF
                                       VS
                        INCOME TAX OFFICER WARD-43(1)
                              KOLKATA AND ORS.


                     Ms. Sutapa Roy Choudhury,
                     Ms. Aratrika Roy
                                  ..for the Appellant.

                     Mr. Soumen Bhattacharya,
                     Mr. Ankan Das
                               ..for the Respondent/Income

Tax Authority.

1. This intra court appeal is directed by the

writ petitioner against the order passed by the learned

Single Bench dated 24th August, 2023 in WPA 20209 of

2023.

2. The appellant had challenged the order

passed under Section 148A(d) of the Act dated 4th

August, 2023 for the assessment year 2017-18.

3. The learned Single Bench has dismissed

the writ petition on the ground that the assessee would

be entitled to raise all issues in the re-assessment

proceedings. The correctness of the order is challenged

in this appeal.

4. We have heard the learned advocates for

either of the parties.

5. The assessing officer had sought to reopen

the assessment for the assessment year 2016-17

relevant to the financial year 2015-16. The said

reopening proceedings were put to challenge by the writ

petitioner by filing WPA 20669 of 2022 which was

allowed by order dated 28.07.2022. The said order has

become final and the department had not filed any

intra court appeal against the said order. With regard

to the assessment year 2017-18 relevant to the

financial year 2016-17, the assessee was issued a

notice under Section 148A(b) dated 30.05.2022. In the

notice it has been stated that credible information has

been received through insight portal regarding cash

deposits, interest receipts, purchase of debentures etc.

The notice states that the details are annexed. The

annexure to the notice is an extract of the relevant

particulars which find place in the return of income

filed by the assessee for the relevant assessment year.

We find that there is no other allegation made against

the assessee as regards the alleged escapement of

income chargeable to tax. The assessee submitted his

reply dated 06.06.2022. Subsequently, taking note of

the order passed by the Hon'ble Supreme Court in the

case of Ashish Agarwal dated 4th May, 2022, a letter

was issued to the assessee dated 21.06.2023 he

submits his reply to the said show cause notice, not

later than 29th June, 2022. The assessee submitted

their reply on 27th June, 2022 wherein they have

specifically stated that there is no material placed by

the department to state that there has been

escapement of income from charge of income tax.

Furthermore, with regard to the cash deposits the

assessee had submitted a reply stating that the

deposits were made by withdrawal from their bank

account. A document in support of the claim was

annexed to the reply. Subsequently an order passed

under Section 148A(d) of the Act dated 28th July, 2023.

This was put to challenge before this court by way of

the writ petition in WPA 20671 of 2022.

6. The said writ petition was allowed by order

dated 28.09.2022 on the ground that there has been

violation of principles of natural justice and the matter

was remanded back to the assessing officer for fresh

consideration. Subsequently, the additional

representation was given by the assessee and the

assessee was heard in the matter and the order under

Section 148A(d) of the Act was passed which was

impugned in the writ petition. The revenue seeks to

sustain the order passed in the writ petition by

contending that the order has been passed after

affording an opportunity of personal hearing to the

assessee, the order is a speaking order and the writ

court cannot adjudicate into disputed questions of fact.

           7.    In   support    of    this    contention,      Mr.

Bhattacharyya,        learned   standing      counsel    for    the

department placed reliance of this court in Shri Shyam

Sundar Dhanuka v. Union of India and Others reported

in APOT 187 of 2023 dated 30.08.2023 and the

decision of the Hon'ble Division Bench of the High

Court at Telengana in the case of Yelliah Setty v.

assistant Commissioner of Income-tax reported in

[2022] 143 Taxmann.com 326 (Telengana).

8. So far as the decision in the case of Shri

Shyam Sundar Dhanuka is concerned, the factual

matrix was entirely different and the court found that

the department had to decode geometrical figures to

ascertain which corresponds to refuse on the rukkus

and ultimately held that these all required adjudication

into disputed questions of fact and affirmed the order

passed by the learned Single Bench dismissing the writ

petition challenging the order passed under Section

148A(d) of the Act. The said judgment is clearly

distinguishable on facts and cannot apply to the facts.

The decision in the case of LARCT has pointed out the

scope of the newly inserted under Section 148A of the

Act and held that the order under Section 148A(d) of

the Act is at a stage prior to issuance of notice under

Section 148A of the Act. It has also been held that

unless glaring omissions are demonstrated or

conditions precedent for exercise of the power to reopen

assessment are not complied with, writ court would not

ordinarily interfere with the order passed under Section

148A(d) of the Act. In the instant case, on perusal of

the impugned order in the writ petition dated

4.08.2023, we find that there are glaring omissions and

more particularly the condition precedent for exercise of

the power of reopening the assessment are

conspicuously absent. Though the order dated

4.08.2023 appears to be an elaborate order, the

conclusion is only in one paragraph, namely, para 8.

The assessing officer has stated that the bank

statements in respect of the transactions done for the

financial year 2015-16 (assessment year 2016-17) has

to be mandatorily verified to examine the nature of

transactions. This cannot done by the assessing officer

because the proceedings initiated by the assessing

officer for reopening the assessment for the assessment

year 2016-17 has been quashed. Therefore, this is a

glaring omission in the order impugned in the writ

petition. Apart from that, the assessing officer would

state that no prudent businessman will simply

withdraw crores of cash from his bank account and

again will deposit it at various stage.

9. In our view, this is a personal opinion of the

assessing officer. However, for the purpose of

reopening an assessment there should be a tangible

material placed by the assessing officer to show that

there was escapement of income from the payment of

income tax. This being conspicuously absent as could

be seen from the annexure to the show cause notice

dated 30.05.2023, the reopening proceedings have to

be held to be bad in law.

10. For the above reasons, the appeal and the

writ petition are allowed and the order passed under

Section 148A(d) of the Act dated 04.08.2023 and the

consequential notice under Section 148 of the Act are

quashed.

(T. S. SIVAGNANAM) CHIEF JUSTICE

(HIRANMAY BHATTACHARYYA, J.)