2017 (9) TMI 1466 - HC - Income Tax

Reopening of assessment - non communication of reasons to believe - Held that - It is the consistent case of the petitioner that the reasons were not communicated to them, and such a specific stand has been taken in the Writ Petitions, which were filed on 23.11.2005, i.e. much after the date on which, it is stated that the assessee received the letter, dated 14.11.2005. However, this Court does not propose to dwell further into such controversy, considering the fact that the Writ Petitions are of the year 2005, and the matters are remain pending for all these years, and order of interim stay has been operating. If the petitioner had been communicated with the reason for issuance of the impugned notices, then, they would have been in a position to subject their objections and proceed with the matter. Thus, without going into the controversy as to whether the petitioner has been communicated the reason for re-opening or not, there will be a direction to the respondent to communicate the reason for re-opening for both the assessment years 2002-03 and 2003-04 within a period of 15 days from the date of receipt of a copy of this order. On receipt of the reason for re-opening, the petitioner is directed to submit their objections within a period of 30 days therefrom.

Summary

Issues:
Challenging notices under Section 148 of the Income Tax Act for assessment years 2002-03 and 2003-04 without reasons provided.

Analysis:
The petitioner filed Writ Petitions contesting the notices issued by the respondent under Section 148 of the Income Tax Act, alleging that income chargeable to tax for the assessment years 2002-03 and 2003-04 had escaped assessment. The petitioner argued that reasons for re-opening were not disclosed. The respondent, in a counter affidavit, mentioned that the assessee was informed of the reason for issuing the notice under Section 148. Despite the petitioner's claim of non-communication of reasons, the court decided not to delve into this controversy due to the prolonged pendency of the case since 2005. The court emphasized the importance of communicating reasons to enable the petitioner to raise objections, citing the directive from the Supreme Court of India in the case of GKN Driveshafts (India) Ltd. v. Income Tax Officer. Consequently, the court directed the respondent to provide reasons for re-opening for both assessment years within 15 days and instructed the petitioner to submit objections within 30 days thereafter. The respondent was mandated to consider the objections and issue a reasoned order in compliance with the law. As a result, both Writ Petitions were disposed of without costs, and the connected Miscellaneous Petition was closed.