M/S. SAI ENTERPRISES THR. PARTNER JAYESH MALDE vs. UNION OF INDIA THR. SECRETARY MINISTRY OF FINANCE INCOME TAX DEPT. AND ORS

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WP/3081/2022HC BombayHCBM01011223202217 March 2022Author: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE SHRI JUSTICE N. R. BORKAR2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court directed the petitioner to file its objections to the Section 148 notice within two weeks from the date of the order. These objections are to be heard and disposed of by the Jurisdictional Assessing Officer (JAO) within three weeks thereafter. The JAO must grant a personal hearing to the petitioner at least seven working days after communicating the notice for the hearing. If the JAO intends to rely on any judgments or orders, a list must be provided to the petitioner along with the hearing notice, allowing the petitioner an opportunity to address them during the hearing. The petitioner's submissions on these judgments must be considered in the assessment order. The time from the lodging of the petition (March 15, 2022) until the date of the order was excluded for completing assessment proceedings. The respondents were restrained from passing the assessment order until the objections were decided and for four weeks thereafter. All rights and contentions of both parties were kept open. The court explicitly stated that no observations were made on the merits of the case.

What were the facts?

The petitioner, M/s Sai Enterprises, through its Partner Jayesh Malde, filed a writ petition before the Bombay High Court challenging a notice dated March 31, 2021, issued under Section 148 of the Income Tax Act, 1961. The petitioner argued that the notice was not digitally signed and was invalid. Furthermore, the reasons for reopening the assessment contained blanks, indicating a non-application of mind by the Principal Commissioner of Income Tax, who granted approval under Section 151. The petitioner had filed its return pursuant to the notice but had not yet filed objections to it. The High Court noted that the petition was lodged on March 15, 2022.

What were the issues?

1. Whether the notice dated March 31, 2021, issued under Section 148 of the Income Tax Act, 1961, is valid, considering it was allegedly not digitally signed and the reasons for reopening contained blanks, indicating a non-application of mind by the approving authority under Section 151. Assessee's Contentions: - The notice is invalid as it is not digitally signed. - The reasons for reopening are incomplete (contain blanks), demonstrating a lack of application of mind by the Principal Commissioner of Income Tax in granting approval under Section 151. Revenue's Contentions: - The judgment records no specific contentions from the revenue regarding the validity of the notice or the grounds for reopening.

Which sections of the Income-tax Act were involved?

Section 148,Section 151

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
1/2 904-wp-3081.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 3081 OF 2022 M/s Sai Enterprises Thr. Partner Jayesh Malde ….Petitioner V/s. Union of India Thr. Secretary Ministry of Finance Income Tax Dept. & ors. …Respondents ---- Dr. Birendra Saraf, Senior Advocate a/w Mr. Khusal Amin and Mr. Jayesh Joshi for Petitioner Mr. Ashok Kotangle a/w Mr. Vivek Sharma i/b Mr. Vipul Bajpayee for Respondents ---- CORAM : K.R. SHRIRAM & N.R. BORKAR, JJ DATED : 17th MARCH 2022 P.C. : 1 Dr. Saraf states that petitioner is impugning a notice dated 31st March 2021 issued under Section 148 of the Income Tax Act 1961 (the said Act) on various grounds. Dr. Saraf states that the notice issued is not even digitally signed and, therefore, should not be even accepted as valid notice. Dr. Saraf further states that the reasons for reopening has blanks and expresses surprise as to how the Principal Commissioner of Income Tax even granted an approval under Section 151 of the Act. Dr. Saraf states it is clear case of non application of mind. 2 We, however, find that petitioner has not filed its objections to the notice, though returns have been filed pursuant to the notice. 3 Petitioner is directed to file its objections within two weeks from today and the objections shall be heard and disposed within three weeks Meera Jadhav MEERA MAHESH JADHAV Digitally signed by MEERA MAHESH JADHAV Date: 2022.03.19 11:13:37 +0530 2/2 904-wp-3081.doc thereafter. Before disposing the objections, the Jurisdictional Assessing Officer (JAO) shall grant a personal hearing and the notice of personal hearing shall be communication at least 7 working days in advance. If Jurisdictional Assessing Officer wishes to rely on any judgments or order passed by any Court or Tribunal, he shall provide a list thereof to petitioner alongwith the notice for personal hearing and give them an opportunity to deal with those judgments or distinguish those judgments during the personal hearing and those submissions of petitioner shall also be dealt with

in the assessment order. 4 Time from the date this petition was lodged, i.e., 15th March 2022 till today, is excluded for the purpose of completion of assessment proceedings. 5 All rights and contentions of the parties are kept open. Naturally, until the order on objections is passed and for four weeks thereafter, respondents shall not pass the assessment order. 6 Petition accordingly stands disposed. 7 We clarify that we have not made any observations on the merits of the case. (N. R. BORKAR, J.) (K.R. SHRIRAM, J.)

Meera Jadhav

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