2022 (10) TMI 1055 - HC - Income Tax

Reopening of assessment - validity of order passed u/s 148A(d) - erstwhile Company got amalgamated with the Petitioner vide an order of NCLT dated 8th November, 2017 resulting in the merger of all the transactions entered into by the erstwhile company - Petitioner states that the Respondent wrongfully passed the order u/s 148A(d) of the Act ignoring the contentions of the Petitioner that assessment under Section 143(3) of the Act had already been finalized in case of the Petitioner for the relevant assessment year - HELD THAT - As revenue, accepts notice. On instructions, he states that the respondents-revenue has no objection if the file is remanded back to the Assessing Officer for fresh consideration. Keeping in view the aforesaid statement, the impugned order passed under Section 148A(d) and notice issued under Section 148 of the Act both dated 31st July, 2022 are set aside and the matter is remanded back to the Assessing Officer for a fresh decision in accordance with law within four weeks. In the event, the petitioner is aggrieved by the said decision, the petitioner shall be at liberty to file appropriate proceedings in accordance with law.

Summary

Issues:
Challenge to order under Section 148A(d) and notice under Section 148 of the Income Tax Act, 1961 for assessment year 2017-18.

Analysis:
The petitioner challenged an order dated 31st July, 2022 passed under Section 148A(d) along with a notice issued under Section 148 of the Income Tax Act, 1961 for the assessment year 2017-18. The petitioner contended that the order sought to reopen the assessment alleging an escapement of income due to the erstwhile company being a non-filer. However, the petitioner argued that the erstwhile company had amalgamated with the petitioner resulting in the merger of all transactions, including the impugned ones, which were duly disclosed, offered to tax, and assessed by the revenue. The petitioner also highlighted that the assessment under Section 143(3) had already been finalized for the relevant assessment year. The respondents were accused of wrongfully passing the order under Section 148A(d) without considering these contentions and dropping similar proceedings for the erstwhile company for the assessment year 2018-19, thereby contradicting their own stand.

The court issued notice to the respondents, who accepted it and stated no objection to remanding the file back to the Assessing Officer for fresh consideration. Consequently, the court set aside the impugned order under Section 148A(d) and the notice under Section 148, remanding the matter back to the Assessing Officer for a fresh decision within four weeks. The petitioner was granted the liberty to file appropriate proceedings if aggrieved by the decision. As a result, the present writ petition along with applications was disposed of accordingly.