SIDDHARTH TOTUKA S/O LATE SHRI ANIL KUMAR TOTUKA vs. ASSISTANT COMMISSIONER OF INCOME TAX

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CW/14363/2025HC RajasthanRJHC02079909202519 September 2025Bench: SANJEEV PRAKASH SHARMA,SANJEET PUROHIT3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the Civil Writ Petition. The Court reiterated its stance from the case of Vaibhav Global Limited Vs. Assistant Commissioner of Income Tax, which was decided by the same bench. In that prior case, the Court had observed that the petitioner was free to raise all necessary arguments and defenses before the authorities, who were required to pass a speaking order. The Court noted that the current notice under Section 153C was a consequence of a previous Division Bench judgment in Shyam Sunder Khandelwal & Ors. Vs. Assistant Commissioner of Income Tax & Ors., where liberty was granted to the respondents to proceed in accordance with law. The Court found no reason to interfere with the action taken by the revenue, given the satisfaction note and the liberty granted in earlier proceedings. All grounds were left open for the petitioner to raise before the assessing authorities.

What were the facts?

The petitioner, Siddharth Totuka, filed a Civil Writ Petition challenging a notice issued under Section 153C of the Income Tax Act, 1961, for Assessment Year 2011-2012. The notice was issued by the Assistant Commissioner of Income Tax, Central Circle-04, Jaipur. The petitioner had previously challenged a notice under Section 148 of the IT Act for the same assessment year, which was quashed by the High Court on March 19, 2024, with liberty to the authorities to proceed in accordance with law. The current proceedings under Section 153C were initiated based on documents seized during a search related to another individual, Dinesh Kumar Khatoria, which reportedly contained entries pertaining to the petitioner regarding undisclosed cash loans amounting to Rs. 3,55,00,000. The High Court referred to its prior decision in Vaibhav Global Limited.

What were the issues?

1. Whether the notice issued to the petitioner under Section 153C of the Income Tax Act, 1961, for Assessment Year 2011-2012 is valid, considering the prior quashing of a Section 148 notice for the same year and the basis of the Section 153C proceedings. Assessee's contention: The petitioner is challenging the validity of the Section 153C notice. While not explicitly detailed in this judgment, the context implies a challenge to the initiation of proceedings under Section 153C, potentially on grounds of lack of proper satisfaction or nexus with the search conducted on another person. Revenue's contention: The revenue contends that the notice is valid. They rely on the liberty granted by the High Court in a previous order to proceed against the petitioner in accordance with law, and the existence of a satisfaction note based on documents found during a search related to Dinesh Kumar Khatoria, which indicated undisclosed cash loans to the petitioner. The revenue also points to the High Court's prior decision in Vaibhav Global Limited, which upheld similar proceedings.

Which sections of the Income-tax Act were involved?

Section 153C,Section 148,Section 131

AI-generated summary — verify with the full judgment below

[2025:RJ-JP:38428-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 14363/2025 Siddharth Totuka S/o Late Shri Anil Kumar Totuka, Aged About 51 Years, R/o D-32-B Malviya Marg C-Scheme Jaipur ----Petitioner Versus Assistant Commissioner Of Income Tax, Central Circle-04, New Central Revenue Building, Janpath, Jaipur. ----Respondent For Petitioner(s) : Mr. Dileep Shivpuri, Adv. Mr. Utkarsh Shara, Adv. For Respondent(s) : Mr. Siddharth Bapna, Adv. Mr. Sarvesh Jain, Adv. Mr. Meyhul Mittal, Adv. HON'BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON'BLE MR. JUSTICE SANJEET PUROHIT Order 19/09/2025 1. Mr. Dileep Shivpuri, learned counsel for the petitioner has vehemently argued however, we refrain from changing our view which we have already taken in the case of Vaibhav Global Limited Vs. Assistant Commissioner of Income Tax: D.B. Civil Writ Petition No. 12529/2025, wherein it held as under:- “1. This matter is related to Dinesh Kumar Khatoria Vs. The Assistant Commissioner Of Income Tax in compliance of which this Court has passed the following order:- “1.The challenge in this petition is to the notice issued to the petitioner under Section 153C of the Income Tax Act, 1961 (for short, "IT Act) dated 04.02.2025 with regard to Assessment Year 2011-2012. 2. Learned counsel for the petitioner submits that in the notice impugned, neither amount has been mentioned nor in the search conducted name of the petitioner has been mentioned, however, from the perusal

[2025:RJ-JP:38428-DB] (2 of 3) [CW-14363/2025] of the satisfaction note for initiating proceedings under Section 153C with reference to the petitioner for the year 2011- 2012, as conveyed to the petitioner, it is apparent that Dinesh Kumar Khatoria's documents were received in pen drive. Entries pertaining to Dinesh Kumar Khatoria, who paid cash loans to various persons, were found during the search proceedings relating to Ramesh Chand Maheshwari under Section 131 of the IT Act. We also noticed that the petitioner had earlier preferred the writ petition Nos.4490/2022 and 4635/2022 before this Court challenging the notice issued to him under Section 148 of the IT Act and this Court quashed the proceedings under Section 148 of the IT Act vide order dated 19.03.2024, with liberty to the Authorities to proceed against the writ petitioner in accordance with law. Since, this Court had granted permission to the respondent-Tax Authorities to proceed, the challenge on the ground of limitation would also not arise as the order was passed by this Court granting liberty to the authorities to proceed. 3. In view thereto, the notice issued to the petitioner with regard to undisclosed cash loans of an amount of Rs.3,55,00,000/-, which remains undisclosed, has to be answered by the petitioner to the Authorities. We, therefore, do not find any reasons to interfere with the notice issued to the petitioner under Section 153C. The petitioner is free to take up all the necessary arguments and defense available to him before the Authorities, who would be required to pass an appropriate speaking order. 4. With the said observations, the writ petition is dismissed accordingly. 5. Pending application(s), if any, also stands disposed of.” 2. The notice of the petitioner is the consequence of the judgment passed by Division Bench of this Court in Shyam Sunder Khandelwal & Ors. Vs. Assistant Commissioner of Income Tax & Ors.: reported in 2024 (4) TMI 196 (D.B. Civil Writ Petition No. 18363/2019) decided on 19.03.2024, where Division Bench held as under:- “40. In view of above discussion the notices issued under Section 148 and the impugned orders are quashed. However, the respondents shall be at liberty to proceed against the petitioners in accordance with law.” 3. It is noticed that the said judgment was assailed before the Hon’ble Supreme Court and in the

[2025:RJ-JP:38428-DB] (3 of 3) [CW-14363/2025] meanwhile taking cue from the observations made by Division Bench, the Revenue has initiated proceedings under Section 153C of the Income Tax Act, 1961 (hereinafter referred to as the ‘Act of 1961) against the petitioner. Since we find that so far as in the earlier writ petitions observations were accepted by the assessee, the notice issued to the petitioner for undisclosed income, as revealed while conducting search of another person, and there being a satisfaction note which has been made a basis for initiating proceedings under Section 153C of the Act of 1961, we are not inclined in any manner to interfere with the action, as taken by the Revenue. 4. With the aforesaid observations, the present civil writ petition is dismissed. However, all the grounds are open for the petitioner to be taken up before the authorities. 5. All pending application(s), if any, stand disposed of.” 2. Keeping in view the judgment passed by this Court in Vaibhav Global Limited Vs. Assistant Commissioner of Income Tax, the present Civil Writ Petition is dismissed, mutatis mutandis. 3. All pending application(s), if any, stand disposed of. (SANJEET PUROHIT),J (SANJEEV PRAKASH SHARMA),J HEENA/MAHIMA/36

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