2022 (6) TMI 572 - HC - Income Tax

Reopening of assessment u/s 147 - Proceedings initiated under Section 148A against the individual PAN number - deposit of the cash in the HUF account - HELD THAT - As claim of the petitioner is that he has submitted the documentary evidence showing the cash transaction, the deposit of the cash in the HUF account. However, the wrong entry was made in the account by giving the personal PAN number. This was explained in the explanation and the same was not considered by the respondent. The contention of the petitioner is that he has submitted his explanation along with the documentary evidence. However, the respondent stated in the impugned order that documentary evidence was not furnished. It is a specific contention of the petitioner is that, sufficient time was not granted to him before passing this order. Therefore, this Court remits the case back to the authorities with the following direction (i) The petitioner shall appear before the authority along with the documentary evidence. (ii) The respondents shall grant personal hearing and consider the explanation and the documents that would be filed by the petitioner. (iii) The respondent is directed to consider the specific stand of the petitioner that individual PAN number was granted while opening the HUF account . The impugned order is set aside and the respondents are directed to complete the said exercise and pass fresh order within a period of twelve (12) weeks from the date of receipt of a copy of this order.

Summary

Issues:
Challenge to impugned order under Section 148-A of the Income Tax Act regarding alleged escaped income assessment.

Analysis:

1. Facts of the Case:
- The petitioner, having HUF status, operates an Aqua Farm and filed income tax returns regularly.
- During the assessment year 2015-2016, the HUF deposited significant amounts in its current account, derived from the sale of prawns.

2. Notice and Response:
- The respondent issued a notice under Section 148-A, alleging escaped income chargeable to tax.
- The petitioner responded, explaining the cash deposits in the HUF current account and filing returns accordingly.

3. Contentions and Evidence:
- Petitioner contended that the cash was deposited in the HUF account, not individually.
- Submitted all relevant documents supporting the explanation, including bank statements and tax return acknowledgments.

4. Impugned Order and Petitioner's Stand:
- The respondent's order indicated that the petitioner did not provide further documentary evidence despite the initial explanation.
- Petitioner argued that the explanation and evidence were submitted but not considered adequately by the respondent.

5. Court's Decision and Directions:
- The Court found that the respondent did not fully consider the petitioner's submissions and evidence.
- Directed the authorities to reevaluate the case, granting a personal hearing to the petitioner and considering the specific issue of the individual PAN number used for the HUF account.
- The impugned order was set aside, and the respondents were instructed to issue a fresh order within twelve weeks.

6. Conclusion:
- The writ petition was disposed of with the given directions, emphasizing a fair consideration of the petitioner's explanation and evidence.
- No costs were awarded, and connected Miscellaneous Petitions were closed as a result of the Court's decision.