WILLIAM BRITTO., vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, PANAJI AND 3 ORS.,

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WP/894/2017HC BombayHCBM05003282201708 January 2018Author: HON'BLE SHRI JUSTICE SHANTANU S. KEMKAR,HON'BLE KUM. JUSTICE NUTAN D. SARDESSAI3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that the notice issued under Section 148 of the Income Tax Act, 1961, was liable to be quashed and set aside. The Court reasoned that it is well-settled that reassessment proceedings under Section 148 cannot be initiated so long as the assessment proceedings pending on the basis of the return already filed have not been terminated. Since the impugned notice was issued before the expiry of the period for taking action under Section 143(2) of the Act, it was premature. The Court therefore set aside the impugned notice and the order rejecting the Petitioner's objection. The petition was allowed, and no order as to costs was made.

What were the facts?

The Petitioner, William Britto, filed a writ petition challenging a notice dated May 19, 2016, issued by the Deputy Commissioner of Income Tax under Section 148 of the Income Tax Act, seeking to re-open the assessment for Assessment Year 2015-2016. The Petitioner had filed a self-assessment on September 3, 2015. The period for taking action under Section 143(2) of the Act was to expire on September 30, 2016. The Petitioner's objection to the re-opening notice was rejected by an order dated September 11, 2017. The Petitioner argued that the Section 148 notice was issued prematurely, before the expiry of the period for action under Section 143(2).

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, for re-opening assessment for Assessment Year 2015-2016 is liable to be quashed when it was issued prior to the expiry of the period for taking action under Section 143(2) of the Act? Assessee's Contentions: The Petitioner argued that the impugned notice under Section 148 was liable to be quashed because it was issued before the expiry of the period for taking action under Section 143(2) of the Act. Reliance was placed on the Bombay High Court's decision in Smt. Suman vs. Income Tax Officer, Ward No.1(1), Nagpur, (2017) 84 taxman.com 267 (Bombay) and the Delhi High Court's order in KLM Royal Dutch Airlines vs. Assistant Director of Income-tax, (2007) 159 Taxman 191 (Delhi). Revenue's Contentions: The judgment records that the learned counsel appearing for the Respondents made submissions, but their specific contentions are not detailed.

Which sections of the Income-tax Act were involved?

Section 148,Section 143(2)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF BOMBAY CORAM : SHANTANU KEMKAR & NUTAN SARDESSAI, JJ. DATE : 8TH JANUARY, 2018 PC: . By filing this Petition under Article 226 of the Constitution of India, the Petitioner has challenged the Notice dated 19th May, 2016 (Exhibit “A”) issued by the Respondents under Section 148 of the Income Tax Act (in short “the Act”) seeking to re-open the assessment for the Assessment Year 2015-2016 as also the order dated 11th September, 2017 (Exhibit “AF”) by which the Petitioner's objection has been rejected.

2.

According to the Petitioner, self assessment was made by it on 3rd September, 2015 for the Assessment Year 2015-2016. The period for taking action under Section 143(2) of the Act was to expire on 30th September, 2016. However Vishal ...1 prior to expiry of the period for taking such action, on 19th May, 2016 the first Respondent issued the impugned notice.

3.

In the circumstances, according to the Petitioner, since the impugned notice has been issued prior to expiry of the period for taking action under Section 143(2) of the Act, the same is liable to be quashed in view of the law laid down by this Court in the case of "Smt. Suman vs. Income Tax Officer, Ward No.1(1), Nagpur, (2017) 84 taxman.com 267 (Bombay). The learned counsel for the Petitioner has also placed reliance on the various orders passed by various High Courts including the order dated 12th January, 2007 passed in the case of "KLM Royal Dutch Airlines vs. Assistant Director of Income-tax”, (2007) 159 Taxman 191 (Delhi).”

4.

Having considered the submissions made by the learned counsel for the Petitioner as also the learned counsel appearing for the Respondents and having gone through the impugned notice as also the impugned order rejecting the objection raised by the Petitioner, in our considered view, since the impugned notice has been issued by the first Respondent before expiry of the period of taking action under Section 143(2) of the Act, the same is liable to be quashed and set aside as now it has been well settled that unless the return of Income already filed is disposed of, notice for reassessment under Section 148 of the Income-tax Act, 1961, cannot be Vishal ...2 issued, i.e., no reassessment proceedings can be initiated so long as assessment proceedings pending on the basis of the return already filed are not terminated.

5.

In view of the aforesaid, we set aside the impugned notice as also the order passed by the first Respondent rejecting the Petitioner's objection.

6.

The Petition is allowed.

7.

No order as to cost. (Nutan D. Sardessai, J.) (Shantanu S. Kemkar, J.) Vishal ...3

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