2022 (4) TMI 45 - HC - Income Tax

Constitutional validity of several provisions of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 - proceedings under section 10 of the 2015 Act, calling upon the petitioner to explain why the amountshould not be added as income of the petitioner under the relevant provisions of the Act - HELD THAT - As petitioner requested the respondent no.1 to allow him a hearing on the preliminary objections as raised questioning the jurisdiction of the respondent no.1 to issue the impugned notice and to dispose of the same by passing a speaking order so as to allow the petitioner reasonable time to challenge such order before the appropriate forum including the High Court. This writ petition stands disposed of with a direction upon the respondent no.1 to hear the petitioner tomorrow at 3.00 p.m. and pass an appropriate reasoned order, in accordance with law, on the objections of the petitioner in relation to the jurisdiction of the respondent no.1 to issue the impugned notice. All contentions on the point of jurisdiction as well as on merits are left open. We make it clear that no separate notice is required to be served on the petitioner since this order is made in the presence of his advocate-on-record, who shall communicate the time when the respondent no.1 intends to hear the petitioner. We grant the petitioner a fortnight s time, as prayed for, to make further submissions on merits if at all the objections to the jurisdictional issue raised by him are spurned by the respondent no.1.

Summary

Issues:
Challenge to the constitutional validity of provisions of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015; Jurisdiction of respondent no.1 to issue a show-cause notice under section 10 of the Act; Request for a hearing and speaking order on objections raised by the petitioner; Time granted to reply to show-cause notice if order is adverse.

Analysis:
The petitioner challenged the constitutional validity of provisions of the Black Money Act through a writ petition, triggered by a show-cause notice from respondent no.1 regarding adding a substantial amount as income under the Act. The petitioner objected to the jurisdiction of respondent no.1 in a representation, raising multiple grounds. Despite the petitioner's contention that the notice was issued without jurisdiction, the Court decided to dispose of the petition based on the petitioner's request for a hearing on jurisdictional objections before passing any order.

The Court directed respondent no.1 to grant the petitioner a personal hearing and pass a reasoned order addressing the objections raised by the petitioner. The petitioner requested a fortnight's time to respond to the show-cause notice if the order on the representation was adverse. The Court allowed this request, extending the period of limitation to pass any order on merits to ensure it is not barred by any law of limitation, subject to objections regarding the expiry of limitation under the Act.

In conclusion, the writ petition was disposed of with a direction for a hearing and a reasoned order on jurisdictional objections. The petitioner was granted time to respond to the show-cause notice if needed, and no separate notice was required to be served. The Court emphasized that all contentions on jurisdiction and merits were left open, and no costs were awarded in this matter.