2016 (10) TMI 1029 - HC - Income Tax

Reopening of assessment - Held that - The re-opening of the assessment under Section 143 of the Income Tax Act was itself bad in law. Hence we set aside the order passed by the learned Single Judge as well as the reassessment order dated 31.01.2014. Accordingly the appeal as well as the writ petition shall stand allowed. However it may be observed that the respondent shall be at the liberty to proceed in the matter in accordance with law after furnishing reasons for issuance of the notice under Section 148 of the Income Tax Act if law permits.

Summary

Issues:
1. Challenge against order directing petitioner to approach Appellate Authority within two months under Section 146(a) of the Income Tax Act.
2. Dismissal of writ petition challenging notice under Section 148 of the Income Tax Act.
3. Violation of principles of natural justice due to non-furnishing of reasons for re-opening assessment.
4. Dispute regarding non-furnishing of statement of another person to the appellant-assessee.
5. Justification of dismissal of writ petition on the ground of availability of alternative remedy.
6. Decision on the appeal against the judgment and order dated 11.12.2014 passed by the learned Single Judge.
7. Observations made by the Division Bench in a similar case and its impact on the present case.

Issue 1:
The present appeal challenges the order directing the petitioner to approach the Appellate Authority within two months as per Section 146(a) of the Income Tax Act. The Division Bench's decision in a similar case is cited as a precedent for the appeal.

Issue 2:
The dismissal of the writ petition challenging the notice under Section 148 of the Income Tax Act is questioned based on the availability of an alternative remedy. The appellant contends that non-furnishing of reasons for re-opening the assessment and a breach of natural justice occurred.

Issue 3:
The violation of principles of natural justice due to the non-furnishing of reasons for re-opening the assessment is highlighted. The appellant asserts that the re-assessment proceedings could not proceed without furnishing reasons, which were requested but not provided.

Issue 4:
A dispute arises regarding the non-furnishing of a statement of another person to the appellant-assessee. The appellant argues that the statement, which formed the basis for re-opening the assessment, was not provided for explanation, leading to a violation of natural justice.

Issue 5:
The justification of the dismissal of the writ petition based on the availability of an alternative remedy is examined. The appellant challenges the dismissal, arguing that the re-opening of the assessment was flawed in law, justifying the appeal.

Issue 6:
The decision on the appeal against the judgment and order dated 11.12.2014 passed by the learned Single Judge is discussed. The Division Bench's ruling in a similar case influences the arguments presented by both parties.

Issue 7:
The impact of the Division Bench's observations in a similar case on the present case is considered. The court notes the similarities in dates and facts between the cases, leading to a consistent view based on the previous decision.

This detailed analysis covers the various issues raised in the legal judgment, providing a comprehensive understanding of the arguments, decisions, and implications discussed in the case.