L AND L HOLDING COMPANY LLC vs. ASSISTANT COMMISSIONER OF INCOME TAX INTERNATIONAL TAX CIRCLE 3 1 2 MUMBAI AND 2 ORS

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WP/8366/2023HC BombayHCBM01025075202331 July 2023Bench: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE SHRI JUSTICE FIRDOSH PHIROZE POONIWALLA3 pages
AI SummaryRemanded

What did the High Court hold?

The Bombay High Court quashed and set aside the impugned order dated 17th April 2023 passed under Section 148A(d) and the consequential notice dated 17th April 2023 issued under Section 148. The matter was remitted back to Respondent No.1 for denovo consideration by an officer other than Ms. Monica Pande. The Court directed that before passing any order, the petitioner must be given a personal hearing with at least 7 working days' advance notice. The petitioner would have three working days to file written submissions after the hearing. The order to be passed under Section 148A(d) must be a reasoned order addressing all submissions. The Court also expressed hope that the officer would consider whether the 'information' in possession of the Department prima facie satisfies the requirement of suggesting escapement from tax, and that issues decided by judicial precedent should not be revisited in reassessment. The revenue was directed to provide a list of queries, if any, along with the notice for personal hearing.

What were the facts?

The petitioner, L and L Holding Company LLC, filed a writ petition challenging an order dated 17th April 2023 passed under Section 148A(d) of the Income Tax Act, 1961, and a consequential notice dated 17th April 2023 issued under Section 148. The respondents are the Assistant Commissioner of Income Tax and others. The impugned order was passed by Ms. Monica Pande. The matter was heard by the Bombay High Court. The revenue, through its Senior Standing Counsel, suggested quashing the impugned order and remanding the matter for fresh consideration by a different officer.

What were the issues?

1. Whether the impugned order dated 17th April 2023 passed under Section 148A(d) of the Income Tax Act, 1961, and the consequential notice dated 17th April 2023 under Section 148, are valid and in accordance with law. Assessee's Contention (implied by the prayer for quashing and setting aside): The petitioner likely contended that the order and notice were erroneous, possibly due to lack of proper information, non-compliance with procedural requirements, or that the reassessment was time-barred and there was no escapement of income. The petitioner also requested that a list of queries be provided in advance to facilitate effective response. Revenue's Contention: The revenue, on instructions and as an officer of the Court, suggested that the impugned order be quashed and set aside, and the matter be remanded for denovo consideration by a different officer.

Which sections of the Income-tax Act were involved?

Section 148A(d),Section 148

AI-generated summary — verify with the full judgment below

433 wp8366-23.docx IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.8366 OF 2023 L and L Holding Company LLC ….. Petitioner Vs. Assistant Commissioner of Income Tax International Tax Circle 3(1)(2), Mumbai and Ors. ….. Respondents Mr.Neeraj Sheth along with Mr.Jitendra Singh for petitioner Mr.Subir Kumar, Senior Standing Counsel a/w Ms.Sruti Kalyanikar for Respondents CORAM: K.R. SHRIRAM, J & FIRDOSH P. POONIWALLA, J. DATED : 31st JULY 2023 P.C. 1. Mr.Subir Kumar, on instructions, and as an officer of the Court, in fairness suggests that the impugned order dated 17th April 2023 be quashed and set aside and the matter be remanded for denovo consideration. 2. In the circumstances, we hereby quash and set aside the order dated 17th April 2023 passed under Section 148A(d) of the Act. We remit the matter back to Respondent No.1 but the officer who shall consider the matter will be someone different from said Ms. Monica Pande who has Mohite 1/3 TRUSHA TUSHAR MOHITE Digitally signed by TRUSHA TUSHAR MOHITE Date: 2023.08.04 14:24:36 +0530

433 wp8366-23.docx passed the impugned order. Respondent No.2 may assign the matter to any other officer as he/she deems fit. 3. The consequential notice dated 17th April 2023 issued under Section 148 is also hereby quashed and set aside. 4. The officer to whom the matter is assigned by Respondent No.2 may pass such order as deemed fit in accordance with law. But before passing any such order Petitioner shall be given a personal hearing notice whereof shall be communicated at least 7 working days in advance to Petitioner. After the personal hearing, should Petitioner wish to file any written submissions recording what transpired during the personal hearing, Petitioner may file the same within three working days thereof. The order to be passed under Section 148A(d) shall be a reasoned order dealing with every submission made by Petitioner. 5. While passing the order, we hope the officer would consider whether the ‘information’ in possession of the Department prima facie, satisfies the requirement of enabling a suggestion of escapement from tax. The officer shall consider whether at all the ‘information’ gathered could lead to a suggestion of escapement from tax. Officer shall also keep in mind that issues decided categorically by judicial precedent should not be revisited in the guise of reassessment. 6. Mr.Sheth states that before respondent no.1 proceeds further Mohite 2/3

433 wp8366-23.docx it would save time if respondent no.1 provides list of queries so that petitioner will be able to effectively respond to the same. Mr.Sheth hastens to add that this also is without prejudice to petitioner’s rights and contentions that the reopening is time barred and there is no escapement of income. Respondent no.1 shall provide the list, if any, alongwih the notice for personal hearing. 7. Petition disposed. No order as to costs. (FIRDOSH P.POONIWALLA, J.) (K.R. SHRIRAM, J.) Mohite 3/3

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