2020 (2) TMI 594 - HC - Income Tax

Revision petition u/s 264 - grounds raised were that the cash flow statement prepared by the assessing officer was not given to the petitioner and his contentions with regard to the same were not considered and that he was not given copies of the statements relied on and that the opportunity to cross-examine the creditors - HELD THAT - No illegality or perversity vitiating the order of assessment justifying an interference in the same in exercise of the jurisdiction of judicial review, that too, in an obviously belated proceedings. The assessee who did not avail of the opportunity to substantiate his case in spite of issuance of notice and grant of opportunity cannot be heard to contend that the order is bad for want of consideration of his contention. No further notice was required to be issued in a matter of this nature where the opportunity is granted pursuant to Exhibit P3 order in revision. The writ petition, therefore, fails and the same is accordingly dismissed.

Summary

Issues:
1. Challenge to Assessment Order and Demand Notice
2. Legality of Sale Proclamation Notice
3. Reassessment and Fresh Assessment Directive

Analysis:
1. Challenge to Assessment Order and Demand Notice:
The petitioner sought to quash the Assessment Order and Demand Notice, alleging illegality and arbitrariness. The petitioner, who had passed away, was under treatment for mental disorders, affecting his capacity to handle tax assessments. The petitioner admitted to discrepancies in share purchase transactions during an enquiry under Section 131 of the Income Tax Act. A revision petition was filed, leading to Exhibit P3 setting aside the assessment and directing a fresh assessment with specific instructions for the assessing officer. However, the petitioner claimed not to have received the assessment order until much later. The respondent contended that re-assessment proceedings were initiated, and the petitioner was given opportunities to respond, which were allegedly not utilized by the petitioner. The court observed that the Assessment Order was duly served based on evidence and dismissed the challenge on the grounds of belated filing and lack of substance.

2. Legality of Sale Proclamation Notice:
The petitioner also challenged the legality of a sale proclamation notice, claiming it to be highly illegal, arbitrary, and against the principles of natural justice. However, the court did not delve into this issue as the petitioner withdrew the challenge, leaving Exhibit P5(a) as the primary focus of contention.

3. Reassessment and Fresh Assessment Directive:
The core issue revolved around the legality of Exhibit P5(a), the assessment order. The court noted that the revisional authority had set aside the initial assessment due to procedural lapses, directing a fresh assessment with specific requirements. Despite the petitioner's claims of not receiving necessary documents or opportunities, the court found that the assessing officer had complied with the directives outlined in Exhibit P3. The court emphasized that the petitioner failed to utilize the opportunities granted for presenting evidence or cross-examining creditors, leading to the completion of the assessment before the deadline. Consequently, the court upheld the assessment order, citing the petitioner's failure to substantiate claims and rejecting the challenge on the grounds of judicial review jurisdiction and belated proceedings.

In conclusion, the court dismissed the writ petition, finding no illegality or perversity in the assessment order, given the opportunities provided to the petitioner, who failed to avail them effectively. The judgment highlighted the importance of utilizing opportunities granted during assessment proceedings and upheld the legality of the assessment order in question.