DAVIES MANUEL vs. INCOME TAX OFFICER

Learned counsel for the petitioner submits that normal limitation period for re-opening the assessment under Section 149(1)(a) of the IT Act, is three years. However, it may extend to ten years if the escaped income is more than Rs.50,00,000/-. He submits that the petitioner’s income is not more than Rs.50,00,000/- which has escaped asssessment. Therefore, the proceedings initiated under Section 148A of the IT Act are barred by limitation, and therefore, without jurisdiction.

Sri.P.G Jayashankar, learned Senior Standing Counsel for the Income Tax Department submits that in the two bank accounts of the petitioner, there has been a cash deposit of around Rs.76,00,000/-. The petitioner did not file return of his income under Section 139 of the IT Act, and therefore, the assessing authority rightly considered that this income to have escaped assessment under the provisions of the IT Act, 1961. The case has been re-opened after 3 years which is as per the statute.

The question whether the petitioner’s explanation for the cash amount deposited in two bank accounts is correct or otherwise a question which can be considered only when the petitioner files the return in pursuance to the notice issued under Section 148 of the IT Act, 1961. At the initial stage of enquiry of re-opening the assessment under Section 148A, the assessing authority has to satisfy itself that whether the income of the petitioner has escaped assessment and if the 3 years period has elapsed from the last date of relevant assessment year, whether the income which has escaped assessment is more than Rs.50,00,000/-. In the present case, income escaped assessment is allegedly more than Rs.50,00,000/- and therefore, the limitation period of 3 years provided under Section 149 (1)(a) has no applicability in the facts of the present case. In view thereof, I find no substance in this writ petition. Therefore, the present writ petition is hereby dismissed. DINESH KUMAR SINGH AP JUDGE