AKSHAR LANDMARK vs. INCOME TAX OFFICER WARD 28(1)(1) AND ANR

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WP/5877/2023HC BombayHCBM01017576202328 March 2024Bench: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE JUSTICE DR. NEELA KEDAR GOKHALE3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disagreed with the stand taken by the Assessing Officer. The Court held that for an assessee to effectively respond to a show-cause notice issued under Section 148A(b), it must be provided with the documents that are relied upon to allege escapement of income. Without these documents, the assessee cannot effectively respond. Consequently, the Court quashed and set aside the order dated March 31, 2023, passed under Section 148A(d). The Court directed the Assessing Officer to provide the requested documents to the Petitioner within two weeks. The Petitioner was then given two weeks to respond, after which an order under Section 148A(d) was to be passed on or before June 15, 2024. A personal hearing was also mandated before passing the final order, with at least five working days' notice.

What were the facts?

The Petitioner, Akshar Landmark, filed its return of income for AY 2019-2020 declaring Nil income, which was processed under Section 143(1). Subsequently, the Petitioner received a notice dated March 2, 2023, under Section 148A(b) from the Income Tax Officer, Ward-28(1)(1), Mumbai, alleging income chargeable to tax had escaped assessment. The Petitioner responded on March 13, 2023, objecting to the reopening and requesting various documents. While a copy of the approval under Section 151 was provided, other requested documents were not. The Assessing Officer, in the order under Section 148A(d) dated March 31, 2023, acknowledged the Petitioner's request for documents but stated that Section 148A does not mandate providing all documents requested by the assessee.

What were the issues?

1. Whether the Petitioner was entitled to receive all documents relied upon by the Revenue to allege escapement of income, to effectively respond to the show-cause notice issued under Section 148A(b) of the Income Tax Act, 1961. Assessee's Contention: The Petitioner argued that to effectively respond to the show-cause notice, it should be provided with all documents that form the basis of the allegation of escaped income. The Petitioner contended that not being provided with these documents hindered its ability to respond meaningfully. Revenue's Contention: The Revenue, through the Assessing Officer's order under Section 148A(d), contended that Section 148A of the Act does not mandate the provision of all documents requested by the assessee, and whatever information was available had been provided.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148A(b),Section 148A(d),Section 151,Section 143(1),Section 148

AI-generated summary — verify with the full judgment below

1/3 914-aswp-5877-2023.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 5877 OF 2023 Akshar Landmark …Petitioner Versus Income Tax Officer, Ward-28(1)(1), Mumbai & Anr. …Respondents Ms. Ritika Agarwal (through VC) i/b ACE Legal Consultants for Petitioner. Mr. Arjun Gupta for Respondents-Revenue. CORAM: K. R. SHRIRAM & DR. NEELA GOKHALE, JJ. DATED: 28th March 2024 PC:- 1. Petitioner is impugning a notice dated 2nd March 2023 issued under Section 148A(b) of the Income Tax Act, 1961 (“the Act”) by Respondent No. 1, the approval granted under Section 151 of the Act by Respondent No. 2, the order dated 31st March 2023 under Section 148A(d) of the Act and the final notice also dated 31st March 2023 issued under Section 148 of the Act by Respondent No. 1. 2. Petitioner had filed its return of income for Assessment Year (“AY”) 2019-2020 declaring total income of Nil. The return of income was processed under Section 143(1) of the Act. Thereafter Petitioner received the impugned notice dated 2nd March 2023 issued under Section 148A(b) of the Act alleging that there was information, which suggests that income chargeable to tax for AY 2019-2020 has Gitalaxmi

2/3 914-aswp-5877-2023.doc escaped assessment. To the notice was annexed the information. Petitioner replied by a letter dated 13th March 2023 in which Petitioner objected to the reopening. Petitioner also asked for various documents. Though Petitioner was given a copy of approval granted under Section 151 of the Act, the remaining documents have not been made available. In the order passed under Section 148A(d) of the Act on 31st March 2023, Respondent No. 1 has admitted that Petitioner had sought all the documents, but has taken a stand that Section 148A of the Act does not talk about providing the documents which are required by Assessee and whatever information was available has been provided. 3. We do not agree with the stand taken by the Assessing Officer (“AO”) inasmuch as qua Assessee to effectively respond to the show- cause notice, Assessee should certainly be made available the documents which are relied upon to allege that there has been escapement of income. Assessee otherwise will not be able to effectively respond to the show-cause notice. 4. Therefore, without going into merits of the matter, we hereby quash and set aside the order dated 31st March 2023 passed under Section 148A(d) of the Act. We direct Respondent No. 1 to provide the documents asked for by Petitioner within two weeks from the date this order is uploaded. Within two weeks thereafter, Petitioner Gitalaxmi

3/3 914-aswp-5877-2023.doc shall respond. An order under Section 148A(d) of the Act shall be passed on or before 15th June 2024, but before passing an order a personal hearing shall be given to Petitioner, notice whereof shall be communicated atleast five working days in advance. 5. Petition disposed. No order as to costs. (DR. NEELA GOKHALE, J.) (K. R. SHRIRAM, J.) Gitalaxmi GITALAXMI KRISHNA KOTAWADEKAR Digitally signed by GITALAXMI KRISHNA KOTAWADEKAR Date: 2024.04.01 15:04:09 +0545

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