2024 (1) TMI 1231 - HC - Income Tax

Maintainability of appeal in writ Court - seeking action as an AO or an appellate authority - Validity of re-assessment order passed u/s 147 - correctness of the order passed u/s 148A (d) - scope of alternate remedy - as argued error has crept in commencing from the stage of issuance of notice un/s 148A (b) and even thereafter, while passing the re-assessment order there has been violation of principle of natural justice as the elaborate reply given by the assessee to the notice issued u/s 142(1) as well as the show-cause notice had not been considered and brushed aside in a single line HELD THAT - The appellant did not question the initiation of the reopening of the assessment by issue of notice u/s 148A (b) nor the appellant challenged the order passed u/s 148(d). Therefore, at this distance of time, the appellant is precluded from questioning the correctness of the order passed u/s 148A (d) of the Act. After the said order, the re-assessment proceedings have commenced and notice under Section 148 has been issued. The assessee has participated in the proceedings, submitted their reply and the assessing officer has considered the reply and passed an order setting out certain reasons. To test the correctness of those reasons, facts have to be gone into much of which are being disputed by the appellant assessee. Therefore, the learned Single Bench was fully justified in holding that the re-assessment order being an appealable order, the same can be challenged before the appellate authority . That apart, whether the replies given by the assessee has been properly appreciated or not appreciated is also a ground which can be canvassed before the appellate authority. That apart, whether the appellant is entitled to seek cross-examination of certain third parties is also a ground which can be urged by the appellant before the appellate authority. Therefore, the learned Single Bench was justified in relegating the appellant to avail the alternate remedy. Thus no ground to interfere with the order impugned. In result, the appeal is dismissed.

Summary

Issues involved:
The judgment involves challenging a re-assessment order under Section 147 of the Income Tax Act, 1961 for the Assessment Year 2014-15 and the dismissal of the writ petition.

Details of the Judgment:

Issue 1: Challenge to the re-assessment order
The appellant challenged the re-assessment order, claiming violation of natural justice and errors in the process. The appellant argued that the assessing officer did not consider the detailed reply provided by the assessee, which included requests for cross-examination and access to relevant materials. The appellant also highlighted that the initial assessment order under Section 143(3) had considered all issues properly. The Court held that it cannot act as an assessing officer or appellate authority to scrutinize facts and findings, emphasizing that such matters should be raised before the appellate authority.

Issue 2: Availability of alternate remedy
The respondent department contended that the writ petition was rightly dismissed due to the availability of an alternate remedy. The Court noted that the appellant did not question the initiation of the reassessment proceedings earlier, and therefore, challenging the correctness of the order at a later stage was not permissible. The Court upheld the decision of the Single Bench to relegate the appellant to avail the alternate remedy of challenging the re-assessment order before the appellate authority.

Conclusion:
The Court found no grounds to interfere with the impugned order and dismissed the appeal. The appellant was granted liberty to raise all points from the writ petition before the appellate authority if intending to file an appeal against the re-assessment order. The judgment highlights the importance of following proper procedures and utilizing the appropriate legal avenues for challenging tax assessment decisions.