Jugal Kishore Lohiya vs Principal Chief Commissioner Of ...
2023 Latest Caselaw 5576 Raj

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 8429/2023

Jugal Kishore Lohiya S/o Asha Ram Lohiya, Aged About 66 Years, R/o C-74, 1St Extension, Ganpati Bhawan, Lok Seva, Hospital Road, Kamla Nehru Nagar, Jodhpur (Raj.) - 342001.

----Petitioner Versus

1. Principal Chief Commissioner Of Income Tax, Jaipur Central Revenue Building, B.d. Road, Jaipur.

2. Income Tax Officer (Ito), Ward - 3(1), Jodhpur, Rajasthan.

3. Central Board Of Direct Taxes, Through Chairman, Department Of Revenue, Ministry Of Finance, North Block, New Delhi.

----Respondents

For Petitioner(s) : Mr Sharad Kothari, Mr Mayank Taparia For Respondent(s) : Mr K.K.Bissa, Mr G.S.Chouhan

HON'BLE MR. JUSTICE VIJAY BISHNOI HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT

Judgment / Order

04/08/2023 (PER HON'BLE VIJAY BISHNOI,J.)

1. This writ petition is filed by the petitioner challenging

the order dated 05.04.2023 passed by assessing officer under

Section 148A(d) of the Income Tax Act, 1961 (hereinafter to be

referred as 'the Act'). The petitioner has also challenged the

notice dated 05.04.2023 issued by the assessing officer under

Section 148 of the Act.

2. Brief facts of the case are that a notice under Section

148A(b) of the Act dated 28.02.2023 was issued to the petitioner

(2 of 11) [CW-8429/2023]

by the assessing officer to show cause why a notice under Section

148 of the Act should not be issued. It is stated in the notice that

as per the information the income chargeable to tax for the

assessment year 2016-17 has escaped assessment within the

meaning of Section 147 of the Act. The notice dated 28.02.2023

further states that as per the information available with the

assessing officer, the petitioner has entered into the following

transaction:

Sr. Information Description Information Value No .

1. Purchased immovable property 1,59,00,000/-

valued at Rs.30,00,000/-

     2.   TDS    Statement-Payment   of 25,00,000/-
          consideration for purchase of
          immovable property

3. TDS Statement-Interest other 45,194/-

than interest on securities

3. It is noticed that the petitioner has not filed return of

income for assessment year 2016-17.

4. After receiving the said notice, as per the petitioner, he

immediately raised concern that though in the notice dated

28.02.2023, it is mentioned that information has been enclosed

with the notice, but no such detail/information has been attached

along with the said notice and thereafter, the petitioner submitted

a detailed reply to the notice along with documents such as bank

details, income tax returns of the joint owners of the property etc.

5. Considering the reply to the notice filed on behalf of the

assessee, the assessing authority has passed the order dated

(3 of 11) [CW-8429/2023]

05.04.2023 under Section 148A(d) of the Act and found it a fit

case of issuing notice under Section 148 of the Act. The order

under Section 148A(d) of the Act proceeded with the notice under

Section 148 of the Act.

6. Assailing the order dated 05.04.2023 passed under

Section 148A(d) of the Income Tax Act and the consequential

reassessment notice issued under Section 148 of the Act, learned

counsel for the petitioner has submitted that reassessment

proceedings are barred by limitation in terms of Clause(a) of sub-

Section (1) of Section 149 because the informative value

happened to be less than Rs.50 lac and three years from relevant

assessment year have elapsed.

7. It is also contended that the order under Section

148A(d) of the Income Tax Act has been passed on the basis of

surmises and conjectures.

8. It is further contended that reassessment notice under

Section 148 of the Act has been issued in utter non-compliance of

the notification dated 29.03.2023.

9. In support of the above contentions, learned counsel

for the petitioner has placed reliance on decision of Bombay High

Court dated 13.03.2023 rendered in Anurag Gupta Vs. Income

Tax Officer, Ward & Ors. (Writ Petition No.10184/2022). He

has also placed reliance on decisions of Delhi High Court rendered

in Krishna Diagnostic Pvt. Ltd. Vs. Income Tax Officer Ward

14 (Writ Petition (C) No.7266/2023) dated 25.05.2023 and

(4 of 11) [CW-8429/2023]

in Balesh Jain Sons HUF Vs. Assistant Commissioner of

Income Tax and Anr. (Writ Petition (C) No.11944/2022

dated 06.09.2022 and prayed that the impugned order dated

05.04.2023 passed under Section 148A(d) of the Income Tax Act

may be set aside and the consequential notice under Section 148

of the Income Tax Act dated 05.04.2023 may also be quashed and

set aside.

10. Per contra, learned counsel for the Revenue

Department has argued that the writ petition filed by the

petitioner is liable to be dismissed as the same is not maintainable

because the impugned order under Section 148A(d) and the

subsequent notice under Section 148 of the Act have been passed

in accordance with the provisions of law following the procedure

prescribed in this regard.

11. It is also contended that the reassessment proceedings

cannot be said to be time barred because the unexplained

transaction represents income assessment amounting to

Rs.1,84,45,194/-, which exceeds the prescribed monetary limit to

Rs.50,00,000/-. It is also contended that the order dated

05.04.2023 passed under Section 148A(d) of the Act is not based

on surmises and conjectures but on the basis of the information

and material available with the assessing officer. It is submitted

that the assessee has failed to furnish satisfactory explanation in

response to the notice issued under Section 148A(d) of the Act

and in such circumstances, the assessing officer, on the basis of

(5 of 11) [CW-8429/2023]

information and material available with it, has passed the order

dated 05.04.2023 in accordance with law.

12. It is further submitted that the reassessment notice

under Section 148 of Income Tax Act is perfectly legal and cannot

be said to be issued in non-compliance of the notification dated

29.03.2023 because the notice under Section 148A(b) of the Act

was issued on 28.02.2023 i.e. prior to the issuance of notification

dated 29.03.2023.

13. In support of the above contentions, learned counsel

for the respondents has placed reliance on decision of Division

Bench of this Court dated 20.3.2023 rendered in M/s Chetak

Enterprises Ltd. vs. The Assistant Commissioner of Income

Tax (D.B.Civil Writ Petition No.7062/2022).

14. In the present case, a notice under Section 148A (b) of

the Act has been issued to the petitioner by the assessing officer

stating that as per the information available in his office, the

assessee entered into certain transactions and details of those

transactions are provided in tabulation form. It is also mentioned

that the assessee did not file income tax return for the

assessment year 2016-17.

15. As per the petitioner, he submitted two short replies,

however, filed a detailed reply later on. Though in first line of the

detailed reply, the petitioner has mentioned that the reply is in

response to the show cause notice dated 14.10.2022 but in first

(6 of 11) [CW-8429/2023]

and second paras of the reply, reference of notice under Section

148A(b) of the Act dated 28.02.2023 is mentioned. It is also

submitted that the petitioner was not in receipt of any information

as mentioned in the notice dated 28.02.2023 as enclosed. He has

stated that in the year 2015, he purchased one plot in the joint

ownership of him, Anurag Lohiya and Swati Lohiya and no other

immovable property has ever been purchased or sold by him. It is

contended by the petitioner that the information available with the

assessing officer is incorrect. Along with the reply, the petitioner

has submitted bank statement of him and the copies of income

tax returns for the year 2016-17 of Anurag Lohiya and Swati

Lohiya have been attached.

16. In the last para of the reply, it is submitted by the

petitioner that the TDS of Rs.4,523/- has been deducted on

interest income of Rs.45,194/-. The petitioner has also

emphasized that the assessing officer is required to comply with

the procedure under Section 148A of the Act. It is also contended

that as per clause (a) of sub-Section (1) of Section 149 of the Act,

the reassessment proceedings cannot be opened as the escaped

income assessment is below Rs.50,00,000/-.

17. The assessing officer, after taking into consideration the

reply filed on behalf of the assessee, has concluded that as per the

information available on tax payer annual summary report, the

assessee has purchased two immovable properties amounting to

Rs.1,59,00,000/- and Rs.25,00,000/-. The assessing officer has

also not accepted the plea of the assessee that the escaped

(7 of 11) [CW-8429/2023]

assessment was Rs.30,50,000/- only as the value of purchased

property was Rs.79,50,000/-, in which the share of the petitioner

is Rs.30,50,000/- only while observing that the petitioner has not

furnished the bank statement. The contention of the assessee

that the total escaped income is less than Rs.50 lac is not

accepted by the assessing officer on the ground that the total

escaped assessment of the income is Rs.1,84,45,194/- and the

assessee has not filed income tax return for the assessment year

2016-17. It is also recorded by the assessing officer that before

issuing notice under Section 148A(b) of the Act, prior approval of

Principal Chief Commissioner of Income Tax, Rajasthan Jaipur was

obtained.

18. We have gone through the reply of the assessee filed in

response to the notice dated 28.02.2023 issued under Section

148A(b) of the Act. Along with the reply, the assessee has

annexed copy of the registry of the property purchased in joint

ownership of him, Anurag Lohiya and Swati Lohiya, bank

statement of him from April, 2014 to April, 2015 and income tax

returns of Anurag Lohiya and Swati Lohiya for the assessment

year 2016-17. Full bank statement for the relevant years has also

been furnished by the assesee.

19. We have noticed that in the notice under Section 148A

(b) of the Act, the assessing officer has indicated that as per

information available in its office, the petitioner has entered into

following transactions during the year under consideration and the

(8 of 11) [CW-8429/2023]

details of the same have been provided in tabulation form. The

petitioner, in his reply to the said notice, has simply denied that he

has not entered any such transaction, however, the bank

statements of the relevant years have not been furnished by the

assessee.

20. From the order passed by the assessing officer under

Section 148A(d) of the Act, it is clear that the details about the

said transaction are available on tax payer annual summary report

of the petitioner. It is not the case of the petitioner that the details

of such transactions are not available on the tax payer annual

summary report of him.

21. In such circumstances, the reasons assigned by the

assessing officer in the order dated 05.04.2023 passed under

Section 148A(d) of the Act cannot be brushed aside at the

threshold. Moreover, the Hon'ble Supreme Court in Raymond

Woollen Mills Ltd. vs. Income Tax Officer, Centre XI, Range

Bombay and others (Civil Appeals No.1972 of 1992 with

No.1973 of 1992, dated 17.12.1997 held as under:

"In this case, we do not have to give a final decision as to whether there is suppression of material facts by the assessee or not. We have only to see whether there was prima facie some material on the basis of which the Department could reopen the case. The sufficiency or correctness of the material is not a thing to be considered at this stage. We are of the view that the court cannot strike down the reopening of the case in the facts of this case. It will be open to the assessee to prove that the assumption of facts made in the notice was erroneous. The assessee may also prove

(9 of 11) [CW-8429/2023]

that no new facts came to the knowledge of the Income-tax Officer after completion of the assessment proceeding. We are not expressing any opinion on the merits of the case. The questions of fact and law are left open to be investigated and decided by the assessing authority. The appellant will be entitled to take all the points before the assessing authority."

(Emphasis supplied)

22. In Anurag Gupta Vs. Income Tax Officer, Ward &

Ors. (supra), the Bombay High Court has set aside the order

passed under Section 148A(d) of the Act as well as the notice

issued under Section 148 of the Act on the ground that no

material was supplied to the petitioner. However, in the present

case, the assessee was given due opportunity of hearing while

giving notice under Section 148A(b) of the Act and the reply filed

by him is duly considered and thereafter detailed order under

Section 148A(d) of the Act has been passed.

23. In Krishna Diagnostic Pvt. Ltd. Vs. Income Tax

Officer Ward 14 (supra), the Delhi High Court has set aside the

order passed under Section 148A(d) of the Act on the ground that

the assessing officer has ignored the relevant documents filed by

the assessee along with his reply in response to the notice issued

under Section 148A(b) of the Act. However, in the present case,

the assessing officer has duly considered all documents filed by

the petitioner along with his reply.

24. In Balesh Jain Sons HUF Vs. Assistant

Commissioner of Income Tax and Anr. (supra), the Delhi High

(10 of 11) [CW-8429/2023]

Court has interfered on the ground that the assessee is not

supposed to prove the negative, but here in the present case,

such facts are not available, therefore, the said judgment is of no

help to the petitioner.

25. So far as the contention of the petitioner that as per

Clause (a) of sub-Section (1) of Section 149 of the Act, the time

has expired for reassessment as the informative value happened

to be less than Rs.50,00,000/- has not impressed us because as

per the information available with the assessing officer, the total

escaped income for consideration is Rs.1,84,45,194/- i.e. more

than Rs.50,00,000/-.

26. So far as other contention of the petitioner that the

notice dated 05.04.2023 under Section 148 of the Act is in

violation of the Notification of Ministry of Finance dated

29.03.2023 is concerned, suffice it to say that prior to the

issuance of the Notification of Ministry of Finance dated

29.03.2023, notice under Section 148A (b) of the Act had already

been issued to the petitioner on 28.02.2023 and in such

circumstances, the process of issuing notice under Section 148 of

the Act had begun prior to the issuance of aforesaid notification of

Ministry of Finance. Hence, it cannot be said that the notice under

Section 148 of the Act has been issued in non-compliance of the

same.

27. In such circumstances, we do not find it to be a fit case

to interfere in the impugned order as well as the notice issued by

the assessing officer.

(11 of 11) [CW-8429/2023]

28. Needless to say the petitioner will have the opportunity

to represent before the assessing officer in response to the notice

issued under Section 148 of the Act.

29. With the above observations, this writ petition fails and

is hereby dismissed. There shall be no order to costs.

30. Stay petition also stands dismissed.

(YOGENDRA KUMAR PUROHIT),J (VIJAY BISHNOI),J

masif/-D.R.

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