2006 (1) TMI 118 - HC - Income Tax

Summary

Issues: Challenge to legality and validity of impugned notices under sections 148, 142, and 143(2) of the Income-tax Act, 1961 for reassessment of income tax for various assessment years.

Analysis:
The High Court of GAUHATI heard a batch of writ petitions challenging the legality and validity of notices issued by the respondent authority under sections 148, 142, and 143(2) of the Income-tax Act, 1961. The petitioners, public limited companies engaged in tea cultivation in Assam, were served with notices for reassessment of income for different assessment years. The Deputy Commissioner had passed assessment orders which were later set aside by the Commissioner of Income-tax (Appeals) for reconsideration. The Assessing Officer revised the assessment orders, leading to the impugned notices for reassessment. The petitioners requested reasons for reopening the assessments, claiming that all necessary facts were already provided during the initial assessment.

Dr. Saraf, the senior counsel, argued for the deduction allowable on account of cess on green leaves to be considered on composite income. He contended that the issues raised in the writ petitions were similar to a previous case, Assam Company Limited, where the court had quashed impugned notices due to unsustainable reasons recorded for invoking section 147 of the Act. The court in the previous case found the reasons for reopening assessments to be legally flawed and lacking a bona fide belief, leading to the quashing of the notices. The current writ petitions were found to have a similar factual matrix as the previous case, and the reasons recorded in the earlier judgment were deemed applicable to the present cases. Consequently, the High Court set aside the impugned notices dated March 28, 2003, and January 6, 2004, as illegal and without jurisdiction, thereby quashing them.

In conclusion, the High Court allowed the writ petitions, ruling the impugned notices to be illegal and without jurisdiction, and therefore quashed them. No costs were awarded in this matter.