2022 (9) TMI 1392 - HC - Income Tax

Reopening of assessment u/s 147 - Petitions have been filed beyond the period of limitation prescribed under the provisions of the Act - HELD THAT - The petitioner has not filed returns of income for the assessment years in question. Based upon information received from Annual Information Report/Central Information Branch data, Income Tax Department had come to know that there had been deposits by the petitioner in cash in its bank accounts for the financial years relevant to the assessment years. On the basis of the above information, the Assessing Authority has arrived at the conclusion that there were reasons available for reopening of assessments, particularly in view of the fact that the petitioner had not filed statutory returns. Thus, on the premise that income chargeable to tax of the above amounts had escaped assessment, notices u/s 148 were issued to the petitioner. There was no response to the same - Evidently, in the absence of a statutory return and abject noncompliance with all notices, the Assessing Authority was not in a position to consider the claim of exemption or any other issue for that matter. Show cause notices were issued to the petitioner, pursuant to the aforesaid letter dated 08.02.2022. Though served, the petitioner had not responded to the show cause notices as well. It is in the aforesaid circumstances that the impugned orders of assessment had come to be passed - There had been substantial non-compliance to all notices barring one dated 13.11.2021 Notices and questionnaires u/s 142(1) had also been issued. We however not inclined to accept the request as, assessments, made validly, cannot be set aside for the mere asking. Admittedly, the petitioners are non-filers and there been also been no compliance to the various notices and questionnaires issued by the respondents. Thus find no infirmity in the orders passed, and in this view of the matter, dismiss these Writ Petitions.

Summary

Issues:
Challenge to assessment orders for assessment years 2013-14 to 2016-17 under the Income Tax Act, 1961.

Analysis:
The Writ Petitions were filed challenging assessment orders passed under Section 147 read with Section 144 read with Section 144B of the Income Tax Act for the assessment years 2013-14 to 2016-17. The petitions were found to be filed beyond the prescribed period of limitation, making them prima facie not maintainable. The petitioner had not filed returns of income for the relevant assessment years. The Income Tax Department discovered cash deposits made by the petitioner in its bank accounts based on Annual Information Report data. The Assessing Authority concluded that there were grounds for reopening assessments due to the lack of statutory returns filed by the petitioner.

The petitioner failed to respond to notices issued under Section 148 and questionnaires under Section 142(1), except for one response claiming eligibility for deduction under Section 80P(2) of the Act as a cooperative society. The petitioner also cited an error in obtaining the PAN and expressed inability to file income tax returns in response to the notice under Section 148. Despite multiple notices and show cause notices, the petitioner did not comply, hindering the Assessing Authority from considering exemptions or other issues. Consequently, the impugned assessment orders were issued based on the petitioner's non-compliance and lack of statutory returns.

The petitioner's counsel argued for setting aside the assessments based on a letter dated 08.02.2022, portraying the Writ Petitions as mercy pleas. However, the Court rejected this request, emphasizing that valid assessments cannot be annulled upon request. Given the petitioner's status as a non-filer and non-compliance with notices, the Court found no flaws in the assessment orders and dismissed the Writ Petitions without costs. Additionally, connected Miscellaneous Petitions were also dismissed in line with the main judgment.