2004 (5) TMI 40 - HC - Income Tax

Proceedings under section 148 - we have not been able to notice any apparent illegality in the finding of the Tribunal when the Tribunal proceeded to uphold the initiation of proceedings on the merits - So far as the issue in relation to the service of notice under section 148 is concerned, we concur with the finding of the Tribunal which has dealt with this issue in its proper perspective. It was rightly held that it was served on the appellant and that no prejudice was caused to the appellant in any manner and that they got full opportunity to defend themselves and challenge the proceedings - In our opinion, not raising an objection, nor indicating the prejudice caused, we cannot possibly hold that any question of law much less pure and substantial question of law arises in the entire proceedings initiated against the assessee under section 148 appeal dismissed

Issues:
1. Appeal under section 260A of the Income-tax Act, 1961 against an order passed by the Income-tax Appellate Tribunal.
2. Challenge to proceedings initiated under section 148 of the Income-tax Act for the assessment year 1990-91.
3. Notice under section 148 not served strictly as per procedure.
4. Reasons for initiating proceedings under section 148 deemed vague or irrelevant.
5. Disagreement with Tribunal's findings on the grounds of challenge.
6. Service of notice under section 148 deemed to have no merit.
7. Lack of prejudice to the appellant in defending against the proceedings.
8. Tribunal's finding on the initiation of proceedings upheld.
9. Adequate materials and reasons found to support proceedings under section 148.
10. No substantial question of law arising in the proceedings.
11. Dismissal of the appeal without notice to the respondent/Revenue.

Analysis:
The judgment pertains to an appeal under section 260A of the Income-tax Act, 1961, filed by an assessee against an order passed by the Income-tax Appellate Tribunal. The challenge revolves around proceedings initiated under section 148 of the Income-tax Act for the assessment year 1990-91. The appellant contested the proceedings on the grounds that the notice under section 148 was not served strictly according to the prescribed procedure and that the reasons for initiating the proceedings were either vague or irrelevant. However, the Tribunal thoroughly examined these grounds, referencing relevant case law, and dismissed the challenge raised by the appellant. The appellant reiterated these grounds in the appeal, seeking to overturn the Tribunal's findings, which the court did not agree with.

Regarding the issue of the service of notice under section 148, the court concurred with the Tribunal's finding that the notice was appropriately served on the appellant, causing no prejudice. The court rejected the appellant's reliance on specific case law, emphasizing that each case's facts must be considered individually before applying the law. The court upheld the Tribunal's decision on this issue, emphasizing that the appellant had ample opportunity to participate in the proceedings and defend themselves.

On the second issue concerning the validity of the proceedings initiated under section 148, the court found no apparent illegality in the Tribunal's decision to uphold the initiation of proceedings based on evidence and facts. The court deemed this issue a pure question of fact that did not warrant interference at the appellate stage. The court highlighted that there were sufficient materials and reasons to support the initiation of proceedings under section 148. Ultimately, the court concluded that no substantial question of law arose in the proceedings, leading to the dismissal of the appeal without notice to the respondent/Revenue.

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