MAHENDRA SINGH (AY 2017-18) S/O SHRI BANA RAM vs. INCOME TAX OFFICER

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CW/8757/2024HC RajasthanRJHC02044317202405 September 2024Bench: MANINDRA MOHAN SHRIVASTAVA,ASHUTOSH KUMAR2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, without commenting on the merits of the case, observed that the assessee was duly served with a notice and filed a reply. The Assessment Officer passed a detailed order. The Court noted that the issue of whether any addition is liable to be made is a matter for the Assessing Authority to consider during the assessment proceedings. Finding no grounds for violation of principles of natural justice or absence of jurisdiction, the Court left the matter to be considered by the Assessing Authority. The Court directed that the submissions made by the assessee before the High Court shall be duly considered by the Assessing Authority to decide whether it is a case for levy of tax on escaped income. The writ petition was disposed of accordingly.

What were the facts?

The petitioner, Mahendra Singh, is challenging an order passed under Section 148A(d) of the Income Tax Act, 1961, for the assessment year 2017-18. The petitioner contends that the authority failed to properly consider his reply dated March 20, 2024, which explained various transactions, including the one leading to the reopening. The petitioner argues that the authority acted perversely by ignoring his reply. The respondent (Income Tax Officer) submits that reopening occurred because the assessee had not filed a return for the assessment year, and a transaction involving the assessee came to the authority's notice. The respondent states that the Assessing Authority will make a final decision on tax liability after hearing the assessee.

What were the issues?

1. Whether the order passed under Section 148A(d) of the Income Tax Act, 1961, is valid, considering the petitioner's contention that his reply dated March 20, 2024, was not properly considered by the authority, leading to a perverse finding. Assessee's Contention: The authority failed to consider the petitioner's reply dated March 20, 2024, which explained the transactions in question. This omission demonstrates a lack of due consideration of the material on record and resulted in perverse findings. Revenue's Contention: The reopening of assessment is justified because the assessee had not filed a return for the assessment year 2017-18, and information regarding a transaction involving the assessee came to the authority's notice. The Assessing Authority will ultimately decide on the tax liability after hearing the assessee.

Which sections of the Income-tax Act were involved?

Section 148A(d)

AI-generated summary — verify with the full judgment below

[2024:RJ-JP:37376-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 8757/2024 Mahendra Singh (Ay 2017-18) S/o Shri Bana Ram S/o Bana Ram, Aged About 45 Years, R/o Malaka Jetusar, Tehsil Shrimadhopur, Sikar, Rajasthan- 332407. ----Petitioner Versus Income Tax Officer, Ward Neem Ka Thana, Near Santoshi Ma Temple, Chhawani Road, Neem Ka Thana, Rajasthan- 332713. ----Respondent For Petitioner(s) : Mr. Vedant Agrawal For Respondent(s) : Mr. Sandeep Pathak with Mr. Arnav Singh HON'BLE THE CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA HON'BLE MR. JUSTICE ASHUTOSH KUMAR Order 05/09/2024 1. Heard. 2. Learned counsel for the petitioner would submit that while passing an order under Section 148A(d) of the Income Tax Act, 1961 (for short the ‘Act of 1961’) the authority has not properly considered his reply, particularly the contents of reply dated 20.03.2024, wherein the assessee had duly explained various transactions including the transaction which was alleged to have resulted in reopening of assessment. Learned counsel for the petitioner would further submit that the manner in which the reply filed by the petitioner has been ignored from consideration, shows that the authority has acted without due consideration of the entire material on record and findings have been recorded in a perverse manner. 3. Learned counsel for the respondent on advance copy draws attention of this Court to order under Section 148A(d) of the Act

[2024:RJ-JP:37376-DB] (2 of 2) [CW-8757/2024] of 1961 passed by the authority to submit that irrespective of whether any addition is liable to be made or not, reopening has taken place as the assessee had not submitted any return of income for the relevant assessment year 2017-2018 and transaction canvassing involvement of the assessee came to the notice of the authority and it is the Assessing Authority who shall take a final decision after hearing the assessee whether it is a case for levy of tax on the assessee on the basis of any escaped income. 4. Without commenting upon the merits of the case, we are of the view that the assessee was duly served with notice. He filed his reply and the Assessment Officer has passed detailed impugned order in the matter. We are not commenting upon as to whether any addition is liable to be made or not because that would be a matter for consideration of the Assessing Authority in the assessment proceedings. 5. In the absence of there being any ground of violation of principles of natural justice or absence of jurisdiction on the part of the authority, we leave the matter to be considered by the Assessing Authority in the assessment proceedings. The submissions which have been made before this Court by the assessee shall be duly considered by the Assessing Authority to decide whether or not it is a case of levy of tax on the ground of any escaped income. 6. The writ petition is accordingly, disposed off. (ASHUTOSH KUMAR),J (MANINDRA MOHAN SHRIVASTAVA),CJ N.Gandhi/TANISHA /10

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