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The High Court held that a notice under Section 148 of the Income Tax Act, 1961, issued in the name of a dead assessee is null and void for want of jurisdiction. The fact that Shri Kirankant Shah died on April 5, 2021, was not disputed. The Court observed that a notice issued in the name of a dead person is unenforceable in law. It cited various High Court judgments, including Savita Kapila Vs. Asstt. CIT, Alamelu Verappan, and Sumit Balkrishna Gupta Vs. Asstt. CIT, which held that there is no statutory obligation on legal representatives to intimate the death of an assessee, and that issuing a notice to a deceased person is a foundational error, not a procedural one, rendering it invalid. The Court noted that its own recent order in W.P. No. 9697/2022 also held similar proceedings unsustainable. Therefore, the impugned notice and consequential proceedings in the name of the deceased assessee were quashed. Liberty was granted to the respondents to reinitiate proceedings against the petitioner as the legal heir, if advised. No issue was expressly left undecided.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when the proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the procedure under Section 148A, including inquiry, providing an opportunity of being heard, considering the assessee's reply, and passing an order under Section 148A(d), followed by a notice under Section 148, was intended to prevent casual issuance of notices and unnecessary harassment. The Court emphasized that the question of going into the veracity and genuineness of the material forming the Assessing Officer's opinion should not be undertaken while exercising writ jurisdiction. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when the proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the procedure under Section 148A, including conducting an inquiry, issuing a show-cause notice, considering the assessee's reply, and passing an order under Section 148A(d), was followed by the Assessing Officer. The Court emphasized that the object of Section 148A is to prevent casual issuance of notices and to save assessees from harassment, and that the assessee has an alternative statutory remedy under Section 246 of the Act to challenge the order and notice. The Court refrained from going into the veracity and genuineness of the material forming the opinion of the Assessing Officer while exercising writ jurisdiction. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act.
The High Court held that the writ petition was not maintainable at the present premature stage. It noted that the procedure under Section 148A, including inquiry and opportunity of hearing, was followed by the Assessing Officer. The Court emphasized the object of Section 148A, which is to prevent casual issuance of notices and to save assessees from unnecessary harassment, by providing them with information and an opportunity to reply before assessment reopening. The Court referred to the Apex Court's directions in Union of India & Ors. vs. Ashish Agarwal, where notices issued under the unamended Section 148 were to be treated as show-cause notices under Section 148A(b), and assessees were given time to reply. The Court also cited judgments from the Punjab and Haryana High Court, affirmed by the Apex Court, stating that writ courts should not interfere when statutory proceedings are ongoing and alternative remedies exist. The Court found that the challenge was based on factual premises concerning the exercise of jurisdiction, for which statutory remedies are available. Therefore, the Court dismissed the petition, granting liberty to the petitioner to avail the statutory alternative remedy under the Income Tax Act.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when the proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court emphasized that the question of going into the veracity and genuineness of the material/evidence forming the opinion of the Assessing Officer suggesting escaped income ought not to be gone into while exercising writ jurisdiction under Article 226 or supervisory jurisdiction under Article 227 of the Constitution of India. The Court noted that the procedure under Section 148A, including conducting an inquiry and providing an opportunity of being heard, was followed. The Court also referred to the Apex Court's directions in Union of India vs. Ashish Agarwal, which treated notices issued under the unamended Section 148 as show-cause notices under Section 148A, and allowed assessees to raise all defenses, including those under Section 149. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act. The Court did not decide on the merits of the allegations of illegality or violation of natural justice.
The High Court held that it should refrain from interfering with the impugned order(s)/notice(s) at such a premature stage, as the proceedings initiated against the assessee were yet to be concluded by the statutory authorities. The Court emphasized that the question of going into the veracity and genuineness of the material/evidence forming the opinion of the Assessing Officer suggesting that income had escaped assessment ought not to be gone into while exercising writ jurisdiction under Article 226 or supervisory jurisdiction under Article 227 of the Constitution of India. The Court noted that the procedure under Section 148A, including conducting an inquiry and providing an opportunity of being heard, was followed. The ratio decidendi is that writ jurisdiction should not be exercised to interfere with tax reassessment proceedings at a preliminary stage when alternative statutory remedies are available, and the merits of the Assessing Officer's opinion should not be examined in writ proceedings. Consequently, the petition was dismissed with liberty to the petitioner to avail the statutory alternative remedy under the Income Tax Act.
The High Court held that the writ petition was not maintainable at such a premature stage. It noted that the procedure under Section 148A, including inquiry, providing an opportunity of hearing, considering the reply, and passing an order under Section 148A(d), followed by a notice under Section 148, had been initiated. The Court emphasized the object of Section 148A, which is to prevent casual issuance of notices and harassment to assessees, and to save the Revenue's time and energy. Citing judgments from the Punjab and Haryana High Court, affirmed by the Apex Court, the Court stated that writ jurisdiction should not interfere when statutory proceedings are ongoing and there is a distinction between jurisdictional error and error of law/fact within jurisdiction, for which statutory remedies exist. The Court refrained from interfering with the impugned order/notice and declined to go into the veracity of the material forming the Assessing Officer's opinion. The petition was dismissed, granting liberty to the petitioner to avail the statutory alternative remedy.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when the proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the procedure under Section 148A, including inquiry, providing an opportunity of being heard, considering the assessee's reply, and passing an order under Section 148A(d), followed by a notice under Section 148, was followed. The Court emphasized that the object behind Section 148A is to inform the assessee of the reasons for potential reassessment and to allow them to file an effective reply, and that the correctness of the order under Section 148A(d) is being challenged on a factual premise, which is a matter for the statutory appellate authority. The Court also stated that the question of going into the veracity and genuineness of the material forming the Assessing Officer's opinion should not be undertaken in writ jurisdiction. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the object behind Section 148A, which was introduced to prevent casual issuance of notices and harassment to assessees, is to enable the assessee to be informed of the reasons for reopening and to file an effective reply. The Court emphasized that the question of going into the veracity and genuineness of the material forming the Assessing Officer's opinion that income has escaped assessment ought not to be gone into while exercising writ jurisdiction. The respondents' contention regarding the availability of an alternative efficacious remedy under Section 246 of the Act was implicitly accepted. The Court directed that the petition is dismissed with liberty to the petitioner to avail the statutory alternative remedy under the Income Tax Act, if advised.
The High Court dismissed the writ petition. It held that, in normal circumstances, a writ court should not interfere at a premature stage when proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the procedure under Section 148A, including conducting an inquiry, issuing a show-cause notice, considering the reply, and passing an order, had been followed. The Court emphasized that the correctness of the order under Section 148A(d) and the veracity of the material forming the Assessing Officer's opinion should not be gone into while exercising writ jurisdiction. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act. The ratio decidendi is that writ jurisdiction is not to be exercised to interfere with assessment proceedings at a preliminary stage when alternative remedies are available, and the merits of the AO's opinion should not be examined in writ proceedings.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the object behind Section 148A is to inform the assessee of the reasons for reopening and to allow them to file an effective reply, after which the Assessing Officer passes an order under Section 148A(d) followed by a notice under Section 148. The Court emphasized that the correctness of the order under Section 148A(d) being challenged on a factual premise, where jurisdiction is vested but allegedly wrongly exercised, is a matter for the statutory appellate authority under Section 246 of the Act. The Court also stated that the veracity and genuineness of the material forming the Assessing Officer's opinion should not be gone into while exercising writ jurisdiction. The petitioner was granted liberty to avail the statutory alternative remedy.
The High Court held that the writ petition is not maintainable at this premature stage. The Court noted that Section 148A of the Income Tax Act, 1961, introduced with effect from 01.04.2021, mandates an inquiry and an opportunity of being heard to the assessee before issuing a notice under Section 148. The Assessing Officer must consider the assessee's reply and pass an order under Section 148A(d). The Court emphasized that the object of Section 148A is to prevent casual issuance of notices and to save assessees from unnecessary harassment. It was observed that the procedure outlined in Section 148A, including conducting an inquiry (if required) and passing an order after considering the assessee's reply, had been followed. The Court referred to the Apex Court's directions in Union of India vs. Ashish Agarwal, which allow for notices issued under the unamended Section 148 to be treated as show-cause notices under Section 148A, with opportunities for the assessee to respond. The Court also cited judgments from the Punjab and Haryana High Court, affirmed by the Apex Court, stating that writ courts should not interfere at premature stages when statutory remedies are available. The Court concluded that the question of veracity and genuineness of the material forming the Assessing Officer's opinion should not be gone into in writ jurisdiction. Therefore, the petition was dismissed with liberty to the petitioner to avail the statutory alternative remedy.
The High Court held that the writ petition was not maintainable at the present premature stage. The Court noted that the procedure under Section 148A, including inquiry, providing an opportunity of being heard, considering the assessee's reply, and passing an order under Section 148A(d), followed by a notice under Section 148, was intended to prevent casual issuance of notices and harassment. The Court emphasized that the object of Section 148A is to inform the assessee of the reasons for escaped assessment and allow them to file an effective reply. Interfering at this stage would defeat the purpose of the statutory procedure. The Court referred to judgments from the Punjab and Haryana High Court, affirmed by the Supreme Court, which held that writ courts should not interfere when proceedings are not concluded by statutory authorities and when there is a distinction between jurisdictional error and error of law/fact within jurisdiction, for which statutory remedies exist. Therefore, the Court refrained from interfering with the impugned order and notice, stating that the veracity of the material forming the Assessing Officer's opinion should not be examined in writ jurisdiction. The petition was dismissed, granting liberty to the petitioner to avail the statutory alternative remedy.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the procedure under Section 148A, including inquiry, providing an opportunity of being heard, considering the assessee's reply, and passing an order under Section 148A(d), was followed. The Court emphasized that the object of Section 148A is to inform the assessee of the reasons for escapement of income and to enable them to file an effective reply. The Court found that the petitioner's challenge to the correctness of the order under Section 148A(d) was based on a factual premise, and there is a distinction between a jurisdictional error and an error of law or fact within jurisdiction, for which statutory remedies are provided. The Court explicitly stated that it would not go into the veracity and genuineness of the material/evidence forming the opinion of the Assessing Officer while exercising writ jurisdiction. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act.
The High Court dismissed the writ petition, holding that it should not interfere at such a premature stage when the proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The Court noted that the procedure under Section 148A, including inquiry, providing an opportunity of being heard, considering the assessee's reply, and passing an order under Section 148A(d), was followed. The Court emphasized that the object of Section 148A is to prevent casual issuance of notices and to save assessees from harassment, allowing them to prepare an effective reply. The Court also pointed out that the petitioner has an alternative statutory remedy under Section 246 of the Act. The veracity and genuineness of the material forming the Assessing Officer's opinion should not be gone into while exercising writ jurisdiction. The petition was dismissed with liberty to the petitioner to avail the statutory alternative remedy.
The High Court dismissed the writ petition. It held that the writ court should not interfere at a premature stage when proceedings initiated against the assessee are yet to be concluded by the statutory authorities. The court noted the procedure under Section 148A, which includes inquiry, providing an opportunity of being heard, considering the assessee's reply, and passing an order. The court also acknowledged the Apex Court's directions in Ashish Agarwal, which allow for notices issued under the unamended Section 148 to be treated as show-cause notices under Section 148A, with specific timelines for providing information and for the assessee to reply. The court found that the respondents had followed the procedure as per the modified directions. Furthermore, the court emphasized that the correctness of the order under Section 148A(d) and the veracity of the material forming the Assessing Officer's opinion should not be gone into while exercising writ jurisdiction, as statutory remedies are available. The petitioner was granted liberty to avail the statutory alternative remedy under the Income Tax Act.
The High Court held that the impugned notice under Section 148 of the Income Tax Act, 1961, issued in the name of a deceased person (Mrs. Amita Lalwani) is unenforceable in law. The fact of the assessee's death on July 7, 2021, was not disputed. The Court relied on various High Court judgments, including Delhi, Madras, and Mumbai High Courts, which have held that a notice issued to a dead person for reopening assessment is null and void. The requirement of issuing a notice to the correct person is a foundational requirement for acquiring jurisdiction to reopen assessment and is not merely a procedural requirement. Sections 292B or 292BB of the Act cannot cure such a substantial error. Therefore, the notice and all consequential proceedings arising therefrom in the name of the deceased assessee were held unsustainable. The Court quashed the notice dated March 31, 2022, under Section 148 and the order dated March 31, 2022, under Section 148A(d), and prohibited further actions.
The High Court held that the notices and order issued under Sections 148A and 148 of the Income Tax Act, 1961, were without jurisdiction and bad in law. The Court reasoned that JBPPL had ceased to exist as a legal entity from the effective date of amalgamation (01.04.2017). Relying on the Supreme Court's decision in Principal Commissioner of Income Tax, New Delhi vs. Maruti Suzuki, the Court stated that a jurisdictional notice issued in the name of an amalgamating company that has ceased to exist is fundamentally illegal. The Court further held that such an entity cannot be considered a 'person' under Section 2(31) of the Act against whom assessment proceedings can be initiated. The Court overruled the objection regarding the availability of an alternative remedy, citing that it does not bar writ jurisdiction when orders are without jurisdiction and violate principles of natural justice. Consequently, all impugned notices, orders, and consequential proceedings were quashed and set aside.
The High Court held that the reassessment proceedings initiated against Jhansi Baran Pathways Pvt. Ltd. (JBPPL) were without jurisdiction and void ab initio. The Court reasoned that JBPPL had ceased to exist as a legal entity from the effective date of amalgamation (01.04.2017). Therefore, it could not be considered a 'person' under Section 2(31) of the Income Tax Act, 1961, against whom assessment proceedings could be initiated. The Court relied on the Supreme Court's decision in Principal Commissioner of Income Tax, New Delhi vs. Maruti Suzuki, which held that jurisdictional notices issued in the name of an amalgamating company that has ceased to exist are fundamentally illegal. The Court overruled the revenue's objection regarding the alternative remedy of appeal, stating that writ jurisdiction is maintainable when orders are without jurisdiction and violate principles of natural justice. Consequently, all impugned notices and orders were quashed and set aside.
The High Court held that the notices and order issued under Sections 148A and 148 of the Income Tax Act, 1961, were fundamentally illegal and without jurisdiction. The Court relied on the Apex Court's decision in Principal Commissioner of Income Tax, New Delhi vs. Maruti Suzuki, which held that if a company has ceased to exist due to an approved scheme of amalgamation, any jurisdictional notice issued in its name is illegal. The Court reasoned that upon amalgamation, the transferor company ceases to exist and cannot be considered a 'person' under Section 2(31) of the Act for assessment proceedings. The Court also overruled the objection regarding the availability of an alternative remedy, stating that it does not bar writ jurisdiction when orders are without jurisdiction and violate principles of natural justice. Consequently, all impugned notices and orders against the non-existent entity were quashed and set aside.
The High Court held that the ground raised by the petitioner, relying on the second proviso to Section 149(1) of the Income Tax Act, 1961, is not tenable. The court reasoned that the second proviso to Section 149(1) states that the provisions of Section 149(1) shall not apply if a notice under Section 153A or Section 153C read with Section 153A is required to be issued in relation to a search initiated under Section 132 or assets requisitioned under Section 132A on or before March 31, 2021. This means that in cases of search conducted on or before March 31, 2021, there is no time restriction for the issuance of a notice under Section 148 of the Act. The object of this proviso is to keep search-related reassessment cases outside the time restrictions prescribed in Section 149(1). Therefore, the restriction imposed by the second proviso is to the applicability of the time frame in Section 149(1) to search cases, not to the power to issue notice under Section 148 itself. Consequently, the petition was dismissed.
The High Court allowed the petition and set aside the impugned order dated 29.09.2023 passed under Section 132(3) of the IT Act. The Court held that the Revenue failed to demonstrate that it was impossible or impracticable to seize the liquor found at the premises, which would have necessitated invoking Section 132(3). The Court noted that the power under Section 132(3) cannot be exercised to circumvent the provisions of Section 132(1) read with sub-section (5). If valuable articles are found during a search and are liable for seizure, they should be seized. The second proviso to Section 132(1) addresses situations where seizure is not practicable due to physical characteristics, making restraint orders deemed seizures. However, if it is not practicable to seize for any other reason, Section 132(3) can be invoked. The Court found that not knowing the value of the articles or whether they are antique cannot be considered a practical difficulty for the authorised officer in effecting seizure. Therefore, the restraint order under Section 132(3) was not validly issued. The Revenue was granted liberty to invoke the right provisions if advised, and was saddled with costs of Rs.10,000/-.
The High Court held that neither the proposed substantial questions of law nor any other substantial question of law arose for consideration. The Court noted that the assessee's grounds in the cross-objection were filed to support the first appellate order, and no substantial arguments were advanced in their support. The ITAT had dismissed the Revenue's appeals for AYs 2011-12, 2012-13, and 2013-14, making the cross-objections academic and infructuous. Consequently, the ITAT did not adjudicate the cross-objections. The High Court, referencing the Supreme Court's decision in Santosh Hazari vs. Purushottam Tiwari, concluded that the questions posed were not substantial questions of law. Therefore, the appeal preferred by the assessee against the ITAT's order was not admitted and was dismissed.
The High Court held that due and sufficient opportunity was afforded to the petitioner before the sanction for special audit was granted, and the competent authority had duly applied its mind. The court found that the objection regarding the interest of revenue not being adversely affected lacked merit due to the element of public interest inherent in special audits. The court noted that the power under Section 142(2A) is wide and inclusive, aimed at avoiding tax evasion and preventing defaulters from escaping the tax net, and should be read liberally in favor of the revenue, with the safeguard of a prior hearing for the assessee. The court distinguished the cited precedents: Sahara India (Firm), Lucknow was based on an unamended section and implied opportunity, whereas the present case had explicit opportunities. Delhi Development Authority was distinguished as the revenue had not perused accounts, whereas in this case, income and expenditure accounts were produced and perused, and a balance sheet was later produced. Therefore, the court found no illegality or impropriety in the impugned order and dismissed the petition.
The High Court dismissed the appeal, finding no substantial question of law. The Court noted that the ITAT had dismissed the Revenue's appeal while upholding the order of the CIT(A), which had reversed the AO's assessment. The Court found that the orders of both the ITAT and CIT(A) were based on a due appreciation of the documents and material available on record. The learned counsel for the appellant (Revenue) was unable to point out any substantial question of law. The ITAT had held that merely because an outstanding amount was more than three years old, it could not be added under Section 41(1) if it was disclosed in the balance sheet and payments were made in succeeding years, especially when there was no cessation of liability or benefit taken by writing off the liability. The ITAT relied on the Delhi High Court's decision in CIT Vs. Shri Vardhman Overseas Ltd. The High Court found no ambiguity in the ITAT's order and upheld its dismissal of the Revenue's appeal.
The High Court dismissed the review petition. Regarding the first ground, the Court found that the use of the expression "obviously" in paragraph 6.1 was a conscious decision based on the definition of "income chargeable to tax" under Section 2(24) of the IT Act, and the Revenue had not brought to its notice any material to equate "income chargeable to tax" with "sale proceeds." Therefore, no palpable error was found. Concerning the second ground, the Court reiterated that while interference under Article 226/227 is generally limited, an exception exists for jurisdictional errors. The Court found that the original order under Section 148A(d) and the consequential notice under Section 148 suffered from a jurisdictional error because the entire sale proceeds were considered without first ascertaining the "income chargeable to tax," which is distinct from total sale proceeds. Thus, this ground also did not disclose a palpable error. On the third ground, the Court noted that the assessee's failure to file an ITR was considered in the original order, and while the view taken might be erroneous, it did not reflect a palpable error on the face of the record. Finally, regarding the cost, the Court affirmed that it was consciously imposed as a punitive and deterrent measure for the Revenue's casual invocation of Section 148A and issuance of notice under Section 148, subjecting the assessee to avoidable litigation and wasting court time. The cost was directly linked to the merits of the matter, which remained undisturbed. Consequently, the review petition was dismissed.
The High Court held that consequent to the Revenue's decision not to file an appeal against the order dated 11.02.2020 passed in MAIT No.71/2004, which had upheld the registration of the petitioner as a charitable trust, the impugned order dated 12.08.2003 passed by the Commissioner of Income Tax-II, Jabalpur, stands quashed. The Court directed that the letter dated 21.08.2023 from the CIT (Exemption), Bhopal, be taken on record. The petition was accordingly allowed without any cost. The principle applied is that when the Revenue accepts a higher judicial pronouncement that is favorable to an assessee, any prior or subsequent order that contradicts this accepted pronouncement is rendered void.
The High Court declined to admit the appeal, finding that the ITAT's order was based on factual findings by both the CIT(A) and the Tribunal. The Court noted that the CIT(A) had provided specific reasons for overturning the Assessing Officer's additions, and the Tribunal had upheld these findings based on the facts and documents on record. The Tribunal's reasoning for concurring with the CIT(A) was not considered arbitrary or perverse. Specifically, regarding the sale of 16,52,318 shares of M/s Mercator Lines Ltd., the CIT(A) had found that the assessee had sufficient shares, including bonus shares and shares held in a client margin account, to cover the sale. The Tribunal agreed with this assessment, noting that no contrary material was presented by the Revenue. Since the concurrent factual findings of the lower authorities did not disclose any substantial question of law, the High Court dismissed the appeal in limine. No issue was expressly left undecided.
The High Court allowed the Revenue's prayer to withdraw the appeal. The Court noted the letter dated July 27, 2023, from the Principal Commissioner of Income Tax-1, Bhopal, indicating the Revenue's intent to withdraw the appeal. Based on this communication and the oral request of the learned counsel for the Revenue, the High Court ordered that the appeal stands dismissed as withdrawn. No decision was made on the merits of the original appeal, and no specific findings or reasoning on the substantive tax dispute were recorded. The operative direction was to dismiss the appeal as withdrawn.
The High Court dismissed both writ petitions. Regarding the first issue, the Court referred to its prior decision in W.P. No. 15244 of 2023, stating that the object of Section 148A was to prevent casual issuance of notices, save assessees from harassment, and save the revenue's time and energy. The Court found that the information supplied with the notice under Section 148A(b) was sufficient and adequate to provide a reasonable opportunity for the petitioner to respond effectively, thus not lacking in material particulars. Consequently, the Court found no reason to interfere with the proceedings. The second issue regarding the live and proximate nexus was implicitly addressed by the finding that the information provided was sufficient, thereby establishing the necessary link for the Assessing Officer's belief.
The High Court noted the communication from the Principal Commissioner of Income Tax-1, Bhopal, indicating the Revenue's intention to withdraw the appeal. The Court directed the Registry to place the letter on record. Subsequently, the learned counsel for the Revenue formally prayed for the withdrawal of the appeal. The High Court allowed this prayer, and consequently, the appeal was dismissed as withdrawn. No findings were made on the merits of the original dispute, and no operative directions were issued other than the dismissal of the appeal.
The High Court held that no substantial questions of law arose from the Tribunal's findings, which were primarily factual. Regarding the addition of Rs.8,44,86,020/-, the Tribunal found that the AO failed to provide a basis for the difference between parallel books and regular books, and the data only pertained to liabilities, not assets or expenditure. The Tribunal concluded that the AO wrongly treated the difference as investment in fixed assets or undisclosed expenditure without supporting material. It inferred suppression of liability in audited books versus parallel books. The Tribunal held that while undisclosed investment or expenditure can be added under Sections 69, 69A, 69B, or 69C, the issue here was undisclosed liability, making the AO's addition based on assumption unjustified. The Tribunal also found that for other proposed questions, its findings were rendered after due consideration of facts. The Court noted that the Revenue was seeking interference in concurrent findings of fact by the Tribunal and CIT(A). Therefore, the appeal was dismissed.
The High Court held that the first question regarding the jurisdictional purview of the power of rectification under Section 254(2) of the IT Act was decided against the Assessee. The Court found that the Tribunal's power to rectify palpable mistakes, which do not require a detailed inquiry, was well within the bounds of law. The Court acknowledged that the Tribunal missed an obvious and palpable mistake in not considering the exception clause of CBDT instructions when dismissing the appeals due to financial implications. However, concerning the second set of substantial questions of law, the Court found that the documentary proof regarding the acceptance of the audit objection was not on record before the Tribunal during the original proceedings. While the Revenue presented documents (D-1 to D-4) before the High Court, the Court refrained from going into their veracity and effect, leaving it to the Tribunal to consider them. The Court noted that the Tribunal, as a judicial body, must adhere to principles of natural justice. Consequently, the other substantial questions of law were decided in favour of the Assessee. The impugned order of the ITAT was set aside, and the matter was remanded to the ITAT for reconsideration on the issue of the audit objection and its acceptance, ensuring adherence to natural justice and proper consideration of relevant documents.
The High Court allowed the petition, quashing the impugned order dated 25.3.2023 under Section 148A(d) and the consequential notice dated 25.3.2023 under Section 148. The Court held that the Revenue had failed to distinguish between sale consideration and income chargeable to tax. The petitioner had clearly indicated in his reply to the Section 148A(b) notice that the Rs. 72,05,084 was the gross sale consideration for 16 scooters, not taxable income. The Court found that the Revenue adopted a casual and perfunctory approach, overlooking this fundamental distinction. The Court also dismissed the Revenue's contention that the petitioner's failure to file a return barred him from challenging the proceedings, stating that Sections 147 to 151 do not support such a view. The Revenue was liberty to invoke Section 148A in accordance with the law. The Court imposed costs of Rs. 25,000 on the Revenue.
The High Court dismissed the appeal filed by the Revenue for want of any substantial question of law. The Court noted that the ITAT had upheld the order of the CIT(Appeals), who had deleted the additions based on several grounds. These grounds included the survey team's failure to consider stock at a particular warehouse, a misclassification of 'Channa' stock as 'Channi' stock, the Revenue authorities not providing the basis for stock valuation (denying natural justice), the Revenue failing to provide any instance of bogus purchases, and the absence of cogent/positive/incriminating material found during the search/survey to support the alleged additions. The Court found that both the CIT(A) and the Tribunal had rendered concurrent findings of fact. Since the Revenue's counsel was unable to point out any aspect disclosing a substantial question of law, and it is settled law that appeals under Section 260A cannot be entertained without such a question, the appeal was dismissed.
The High Court held that the petitioner is not entitled to the material/evidence (oral/documentary) which formed the basis of the Assessing Officer's opinion, as long as the show-cause notice mentions such foundational evidence/material and the supportive reasons for forming the opinion. The Court interpreted Section 148A(b) to mean that the show-cause notice must contain sufficient information revealing the opinion formed by the Assessing Officer that certain income has escaped assessment, with a precise elaboration of the foundational material. The Court found that the show-cause notice, accompanied by an annexure, informed the petitioner of the reasons and information that persuaded the Assessing Officer to form a tentative opinion of escaped assessment for AY 2016-17, and the petitioner had filed a detailed reply. Therefore, the impugned order and consequential notice were issued after following due process. The Court also clarified that the veracity and genuineness of the material forming the Assessing Officer's opinion should not be gone into while exercising writ jurisdiction. The petition was dismissed at the admission stage, with liberty to the petitioner to avail the statutory alternative remedy.
The High Court held that the impugned order dated 03.01.2023 was devoid of any reason and therefore deserved to be set aside. The Court found substantial force in the petitioner's argument that the ITO had not taken pains to deal with the factual backdrop, the relevant statutory provision (Section 220(6) of the Income Tax Act, 1961), and the judgments cited by the petitioner in support of the application. Citing the Supreme Court's decision in M/s. Kranti Associates Pvt. Ltd. and another Vs. Masood Ahmed Khan and others, the Court emphasized that reasons are the heartbeat of conclusions and that an order without reasons cannot sustain judicial scrutiny. Consequently, the impugned order was set aside, and the matter was restored to the file of respondent No. 3 for rehearing the parties on the application and passing a fresh order in accordance with law. The Court also stayed the attachment order of the petitioner's bank account till a fresh decision was taken on the stay application.
The High Court held that the foundational question was whether the ITAT committed an error in upholding the CIT(A)'s deletion of the addition of Rs.69,18,07,576/-. The Tribunal, while considering the dispute for various assessment years, adopted findings for assessment year 2012-13 from other years. The Court noted that the Tribunal found no charge of evasion of royalty/tax, and therefore, it could not be presumed that there was any suppression of production or purchases. The Tribunal also found that the AO's findings leading to the addition were based on presumption rather than proof. Furthermore, the Court observed that the Tribunal's findings were based on factual disputes. In the absence of any substantial question of law arising from these purely factual findings, the Court declined admission of the appeal. The appeal was accordingly dismissed.
The High Court held that when a statutory appeal is preferred by an assessee, it is mandatory for the appellate authority to decide it as per Section 250(6A) of the Income Tax Act, 1961. The Court noted that the prescribed time period for deciding an appeal is generally one year from its filing, and the petitioner's appeal had been pending for over four and a half years. The Court found no useful purpose in keeping the writ petition pending and therefore disposed of it with specific directions. The Revenue was directed to ensure that the petitioner's appeal is decided expeditiously, within an outer limit of four months from the date of the order. The Court clarified that other grounds raised by the petitioner were not decided and would remain open for him to raise if occasion arises and the law permits.
The High Court held that the appeal did not involve any substantial question of law, which is a prerequisite for admission under Section 260A of the Income Tax Act, 1961. The Court reasoned that making additions or deletions to income cannot inherently be considered erroneous and prejudicial to the interest of the revenue. Therefore, the appeal lacked merit and was dismissed in limine. The specific findings of the ITAT regarding the assessment order being erroneous and prejudicial to the revenue, and the assessee's explanation for the difference in receipts, were not re-examined on merits by the High Court, as the appeal was dismissed on the preliminary ground of not involving a substantial question of law.
The High Court declined to entertain the writ petition for staying the demand. The Court reasoned that granting such relief under Article 226 was not appropriate given the circumstances. Firstly, a statutory appeal against the assessment order dated 29.03.2022 was already filed and was pending. Secondly, the petitioner had independently filed applications under Section 220(6) of the Income Tax Act before the CIT (Appeals) and the Chief Commissioner, which were also pending. The Court observed that these applications had been pending since 28.04.2022 and directed that they be addressed expeditiously. The Court explicitly stated that it had not expressed any opinion on the merits of the case. The writ petition was disposed of with these observations.
The High Court held that an appeal under Section 260A of the Income Tax Act, 1961, can only be entertained if a substantial question of law is involved. After hearing the learned counsel for both parties, the Court found that the issues discussed by the Tribunal were primarily facts-centric, even though legal provisions were referenced. The Tribunal had taken care to discuss all issues raised before it and rendered findings based on facts. Therefore, the Court concluded that no substantial question of law was made out, let alone the proposed ones. Consequently, the High Court declined to interfere and dismissed all five appeals in limine. No specific findings were given on the merits of the individual issues framed by the Tribunal, as the appeals were dismissed on the preliminary ground of lacking a substantial question of law.
The High Court held that the appeals could only be entertained if a substantial question of law was involved, which it found not to be the case. The Court observed that the Tribunal had taken care to discuss all issues raised before it and had rendered findings primarily based on facts, even though legal provisions were referenced. The adjudication and findings were essentially fact-centric. Therefore, in the absence of any substantial question of law being made out, the High Court declined interference. The appeals were dismissed in limine. The Court did not decide on the merits of the individual issues raised by the assessee, as the threshold for entertaining an appeal on substantial questions of law was not met.
The High Court held that an appeal under Section 260A of the Income Tax Act, 1961, can only be entertained if a substantial question of law is involved. After hearing the learned counsel for both parties, the Court found that the issues discussed by the Tribunal were primarily facts-centric, even though legal provisions were referenced. The Tribunal had taken care to discuss all issues raised before it and rendered findings based on facts. Therefore, the Court concluded that no substantial question of law was made out, let alone the proposed ones. Consequently, the High Court declined to interfere and dismissed all five appeals in limine. No specific findings were given on the merits of the individual issues framed by the Tribunal, as the appeals were dismissed on the preliminary ground of lacking a substantial question of law.
The High Court held that none of the substantial questions of law, including those pressed by the assessee, arose for consideration. Regarding the first issue (Section 151 approval), the court found the ITAT's findings to be purely factual and not giving rise to a substantial question of law. Concerning the second issue (Section 147 in search cases), the court noted the absence of any statutory prohibition and concluded that Section 147 could be invoked even in search and seizure cases, deeming it not a substantial question of law. For the third issue (Section 68 addition), the court observed that the ITAT had considered the aspect in detail, and its findings were essentially factual, thus not constituting a substantial question of law. Consequently, the appeal was rejected in limine due to the absence of any substantial question of law.
The High Court held that an appeal under Section 260A of the Income Tax Act, 1961, can only be entertained if a substantial question of law is involved. After hearing the learned counsel for both parties, the Court found that the issues discussed by the Tribunal were primarily facts-centric, even though legal provisions were referenced. The Tribunal had taken care to discuss all issues raised before it and rendered findings based on facts. Therefore, the Court concluded that no substantial question of law was made out, let alone the proposed ones. Consequently, the High Court declined to interfere and dismissed all five appeals in limine. No specific findings were given on the merits of the individual issues framed by the Tribunal, as the appeals were dismissed on the preliminary ground of lacking a substantial question of law.
The High Court held that an appeal under Section 260A of the Income Tax Act, 1961, can only be entertained if a substantial question of law is involved. After hearing the learned counsel for both parties, the Court found that the issues discussed by the Tribunal were primarily facts-centric, even though legal provisions were referenced. The Tribunal had taken care to discuss all issues raised before it and rendered findings based on facts. Therefore, the Court concluded that no substantial question of law was made out, let alone the proposed ones. Consequently, the High Court declined to interfere and dismissed all five appeals in limine. No specific findings were given on the merits of the individual issues framed by the Tribunal, as the appeals were dismissed on the preliminary ground of lacking a substantial question of law.
The High Court declined to interfere with the order passed under Section 148A(d) of the Income Tax Act, 1961, finding no jurisdictional error on the part of the Assessing Officer. However, the Court clarified that the order under Section 148A(d) is not a substitute for the final assessment order. The Assessing Officer is statutorily obligated to examine all material before concluding that income has escaped assessment. Consequently, the Court directed the Assessing Officer to grant the petitioner liberty to file complete documents pertaining to the bank account deposit and any other relevant documents. The Assessing Officer was further directed to proceed with the re-assessment proceedings initiated by the notice under Section 148, with due consideration to the entire record. The Court explicitly stated that it had not expressed any opinion on the merits of the case.
The High Court declined to interfere with the impugned order passed under Section 148A(d) of the Income Tax Act, 1961. The Court found no jurisdictional error on the part of the Assessing Officer in passing the order. However, the Court clarified that the order under Section 148A(d) is not a substitute for the final assessment order. The Assessing Officer is statutorily obligated to consider all materials before concluding that income has escaped assessment. The Court directed the Assessing Officer to grant the petitioner liberty to file complete documents pertaining to the SBI bank account in Shivpuri and any other relevant documents. The Assessing Officer was further directed to process the re-assessment proceedings under Section 148 with due regard to the record placed before him. The Court explicitly stated that it had not expressed any opinion on the merits of the case. The writ petition was disposed of with these directions.
The High Court held that the jurisdiction conferred upon the Assessing Officer under Section 148A(d) is solely for recording satisfaction as to whether reassessment proceedings may be initiated. This jurisdiction is not a substitute for the substantive jurisdiction under Section 148. The AO is not obliged to record detailed reasons touching the merits of the reassessment issue at this stage. The Court found that the AO had considered the petitioner's objection regarding the time-bar in paragraphs 7.1 and 7.2 of the impugned order and, with reference to the Supreme Court's judgment in Shri Ashish Agarwal, directed that all objections could be raised in response to the notice under Section 148. Therefore, no illegality or jurisdictional error was found in the impugned order, considering the limited scope of Section 148A(d). The Court also observed that the detailed impugned order suggested a bonafide exercise of power. The petitioner was granted liberty to raise all factual and legal grounds before the AO while responding to the notice under Section 148. Consequently, the writ petition was dismissed.