NEMI CHAND CHHAJER vs. PRINCIPLE COMMISSIONER OF INCOME TAX-I

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CW/17818/2019HC RajasthanRJHC01080050201902 December 2019Author: DINESH MEHTA3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the petitioner's argument was frivolous and untenable. While it was factually correct that the reasons and satisfaction recorded for the present notice under Section 148 for Assessment Year 2013-14 were identical in phraseology to the earlier notice for Assessment Year 2011-12, this did not render the proceedings illegal or without jurisdiction. The Court reasoned that material seized from a third party might contain transactions spread across different account or assessment years. Consequently, the Income Tax Officer can initiate reassessment proceedings for different years based on such material, splitting transactions to the year they relate. The Court found that the authorities had objectively applied their minds to the required extent. Therefore, the impugned notice was not found to be void or without jurisdiction. The writ petition and the stay application were dismissed.

What were the facts?

The petitioner, Nemi Chand Chhajer, filed a writ petition challenging a notice dated March 19, 2019, issued by the Income Tax Officer under Section 148 of the Income-Tax Act, 1961. The petitioner argued that the reasons for this notice were identical to those for a previous notice dated March 28, 2018, and that no new material justified fresh reassessment proceedings, especially since the earlier proceedings had concluded with an assessment order dated December 18, 2018. The petitioner's counsel highlighted that the satisfaction recorded by the Commissioner of Income Tax was also almost identical. The court noted that the earlier notice pertained to Assessment Year 2011-12, while the current notice was for Assessment Year 2013-14.

What were the issues?

1. Whether the issuance of a fresh notice under Section 148 of the Income-Tax Act, 1961, for Assessment Year 2013-14, with reasons and satisfaction identical to a previous notice for Assessment Year 2011-12, renders the reassessment proceedings void or without jurisdiction, particularly when the earlier proceedings have culminated in an assessment order. Assessee's Contentions: - The reasons recorded for the present notice under Section 148 are exactly identical to those for the earlier notice. - There is no new material available with the respondents to initiate fresh reassessment proceedings. - The proceedings in furtherance of the earlier notice have already culminated into an assessment order. Revenue's Contentions: - The judgment does not explicitly record any specific contentions made by the revenue. However, the court's reasoning implies that the revenue would have argued that transactions found in seized papers can span multiple assessment years, justifying separate reassessment proceedings for different years.

Which sections of the Income-tax Act were involved?

Section 148,Section 147,Section 143(3)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Civil Writ Petition No. 17818/2019 Nemi Chand Chhajer S/o Kaan Mal Chhajer, Aged About 55 Years, Resident Of F-330, Mandia Road, Pali. ----Petitioner Versus 1. Principle Commissioner Of Income Tax-I, Income Tax Department, Paota C Road, Jodhpur. 2. Income Tax Officer, Ward No. 4, Mandia Road, Pali. ----Respondents For Petitioner(s) : Mr. Sandeep Bhandawat JUSTICE DINESH MEHTA

Order 02/12/2019 Feeling aggrieved of the notice dated 19.03.2019, issued by the respondent No.2 under Section 148 of the Income- Tax Act, 1961 (for short, ‘the Act of 1961’), the petitioner has preferred the present writ petition under Article 226 of the Constitution of India. Assailing the impugned notice, Mr. Bhandawat invited Court’s Attention towards the notice dated 28.03.2018, issued by the respondent No.4 and submitted that the reasons recorded before issuance of the earlier notice and the present notice are exactly identical and there is no new material with the respondents to initiate fresh proceedings under Section 148 of the Act of 1961, particularly when the proceedings in furtherance of the earlier notice have already culminated into an assessment order dated 18.12.2018. (Uploaded on 04/12/2019 at 01:49:54 PM) (Downloaded on 28/10/2026 at 12:04:52 AM) (2 of 3) [CW-17818/2019] The basic premise for challenging the re-assessment proceedings is, that a fresh notice has been issued practically for the same reasons and even the satisfaction recorded by the Commissioner, Income Tax – the competent authority, is almost identical. It was also argued that there is no new material available with the respondent No.2 to initiate re-assessment proceedings against the petitioner. Upon perusal of the material available on record, this Court finds the argument advanced by Mr. Bhandawat to be frivolous. The earlier notice under Section 138 of the Act of 1961 had been issued for the Assessment Year 2011-12, inter alia referring to certain loose papers recovered from one Mr. Mahendra Kankaria; the proceedings in furtherance of the earlier notice, after taking response from the petitioner, have culminated into an assessment order under Section 147/143(3) of the Act of 1961. Indisputably, the notice, which has been challenged in the present writ petition is for the Assessment Year 2013-14. The reasons mentioned and the satisfaction arrived at by the Commissioner is in the same phraseology, however, the same by itself does not render the proceedings to be void or without jurisdiction. A set of paper seized/recovered from third party, may contain transaction, spread in different account years/assessment years. On the basis of the material so found, the Income Tax Officer can very well initiate proceedings for re-assessment splitting those transactions in respect of the year, to which they relate. This is, precisely what has happened in the instant case. (Uploaded on 04/12/2019 at 01:49:54 PM) (Downloaded on 28/10/2026 at 12:04:52 AM) (3 of 3) [CW-17818/2019] The contention of Mr. Bhandawat that fresh proceedings under Section 148 of the Act of 1961 has been initiated for the same reasons, is factually correct, but the same does not render the proceedings to be illegal. Since the proceedings are for different assessment years, the argument so zealously advanced, is untenable. So far as the satisfaction of the concerned Assessing Officer and the Commissioner, Income Tax is concerned, a perusal of the pages Nos.65 to 69 available on record clearly suggests that both the authorities have applied their mind objectively and to the fullest extent required under the law. No other argument was advanced by the learned counsel for the petitioner. This Court does not find the impugned notice to be void or without jurisdiction in any manner. The writ petition, therefore, fails. The stay application also stands dismissed.

(DINESH MEHTA),J 228-skm/- Powered by TCPDF (www.tcpdf.org) (Uploaded on 04/12/2019 at 01:49:54 PM) (Downloaded on 28/10/2026 at 12:04:52 AM)

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